The U.S. Department of the Treasury will audit all contracts and task orders awarded under preference-based contracting, totaling approximately $9 billion in contract value across Treasury and its bureaus.
The audit will examine potential misuse of the Small Business Administration’s 8(a) Business Development Program and other initiatives that provide federal contracting preferences to certain eligible businesses.
These actions follow Treasury’s earlier suspension and termination of all contracts and task orders with ATI Government Solutions, following allegations of fraud involving more than $253 million in previously issued contract awards.
The U.S. Department of the Treasury today announced a comprehensive audit of all contracts and task orders awarded under preference-based contracting, totaling approximately $9 billion in contract value across Treasury and its bureaus. The audit will examine potential misuse of…
— Treasury Department (@USTreasury) November 7, 2025
The Treasury is focused on detecting and eliminating fraud and abuse of taxpayer dollars. Prior use of contracting preferences that fall outside normal procurement rules may have enabled large companies to use pass-through arrangements where an eligible small business retains fees for minimal participation, while subcontracting nearly all work. Most of the contracts under review were awarded by the Biden administration’s equity in procurement initiative.
“President Trump has directed his administration to eliminate fraud and waste wherever it occurs, ensuring that each taxpayer dollar is spent as intended,” said Treasury Secretary Scott Bessent. “Treasury will not tolerate fraudulent misuse of federal contracting programs. These initiatives must benefit legitimate small businesses that deliver measurable value to the government and the public.”
Treasury’s acquisition professionals have been instructed to require detailed staffing plans and monthly workforce performance reports for all service contracts. These tools will help detect non-performance and pass-through contracting that could point to potential fraud.
“During the Biden Administration, federal contracting set-aside programs proliferated without scrutiny or oversight – which is why the SBA launched a full audit of the 8(a) Business Development Program earlier this year to examine contracts across every agency,” said Kelly Loeffler, Administrator of the U.S. Small Business Administration. “This Administration will not tolerate DEI-based contracting and abuse that compromises opportunity for legitimate and eligible small businesses. I am grateful to Secretary Bessent for his commitment to rooting out fraud at the Department of the Treasury and for taking major steps to help SBA stop the rampant waste of taxpayer dollars.”
President Trump has directed his administration to eliminate fraud and waste wherever it occurs, ensuring that each taxpayer dollar is spent as intended.
— Treasury Secretary Scott Bessent (@SecScottBessent) November 7, 2025
Treasury will not tolerate fraudulent misuse of federal contracting programs. These initiatives must benefit legitimate…
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