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September 16, 1990


By CBR Staff Writer

Allegations against the company were always flimsy and an investigation by the US Navy Department into its officials’ conduct of computer procurements finds no evidence of violation of Federal laws in IBM’s conduct in bidding for Navy contracts. The main issue in the inquiry however is whether Navy personnel unfairly favoured IBM in the procurement process. The report says that although it was ill-advised for Navy officials to ask IBM to help them draw up the specification for one tender, it was not actually illegal, and that sporting recreation facilities made available to Navy officials at an IBM training centre created the apperance of impropriety but did not constitute an illegal gratuity under applicable regulations. The House (of Representatives) Government Operations Committee is still unhappy about the conduct of government procurements statistics from the General Accounting Office show that IBM supplied 82% of the mainframes at Agriculture, 83.5% at Heath & Human Resources, 72.1% at the Treasury and 53.6% at NASA, and that 80% of mainframe procurements over the past three years specified IBM-compatiblity. The Office blamed general lack of knowledge of the procurement process at government agencies for the appearance of bias towards IBM. Chairman of the House committee John Conyers said he would continue to hold hearings on the government’s procurement of computer equipment until the system was reformed.

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