Program Misses $409 Sinks, $2 Screws

ByABC News
March 22, 2001, 10:54 AM

W A S H I N G T O N, March 22 -- In a high-tech twist to a familiar Pentagonproblem, a computer system designed to prevent purchases ofoverpriced hammers and toilet seats created some excesses of itsown including spending $409 on a sink worth just $39.

The Defense Department installed the system to automatepurchases and eliminate possible fraud by human buyers. But thecomputer never checked more than one vendor to get the best price.

Besides buying six of the high-priced sinks, the system boughtscrews for $2 that should have cost less than 50 cents and "dustprotection plugs" for 25 cents that actually cost just pennies,according to a Pentagon inspector general report obtained by TheAssociated Press.

Auditors: Time to Change the Process

The report said contractors probably know how to cheat thesystem without getting caught. Auditors estimated that overpaymentsaccounted for $1.2 million of the $14 million in automatedpurchases they reviewed from April 1999 through March 2000.

"It is now time to change the process," the auditors wrotelast week.

The Defense Logistics Agency the Pentagon's purchasing manager is upgrading the computer system so it can check prices fromseveral suppliers to find the lowest one. Still, agency officialscriticized the $1.2 million overpayment estimate, saying auditorsshould have deducted more than $45,000 in vendors' refunds.

"We've already gone back to get a refund" of $2,142 for theoverpriced sinks, DLA spokeswoman Gerda Parr said Wednesday.

The Pentagon was the target of ridicule from members ofCongress to comedians in the 1980s for wasteful spending like a$640 airplane toilet cover and a $435 hammer. The overchargingproblem remains despite more than a decade of attempts to stamp itout: Examples from the past few years include a $350 ball bearingand a $76 screw.

Asking to be Duped

Critics say some changes meant to streamline the Pentagon'spurchasing system have made it more difficult to root out pricegouging.