The Corner

Insurance Exchange Contractor Got Increased Award Despite Scandals

Today on the homepage, I report about Serco, an Obamacare contractor with a long and scandal-ridden record abroad. Regardless of numerous problems, Serco secured one of the ACA’s largest insurance-exchange contracts after spending more than a million dollars in recent years on lobbying and political contributions.

Just days after the Obama administration announced in July that it was awarding Serco a $1.249 billion contract, news broke that the huge multinational corporation was being investigated by the British Serious Fraud Office for potentially overbilling the government by millions of dollars.

One might suspect, then, that the Obama administration would feel a bit bashful about granting a billion-dollar contract to Serco. But instead, it defended its choice, calling Serco a “highly skilled company” with “a proven track record in providing cost-effective services to numerous other federal agencies.”

But Serco’s July overbilling scandal was fast followed by others. In August, the London police began looking into whether Serco had falsified reports about their performance for another government contract. And in September, a woman from the Serco-managed Yarl’s Wood immigration-detention center claimed she had been sexually coerced by its employees.

Even so, I’ve just learned, the Obama administration chose shortly thereafter to significantly increase Serco’s contract, putting its total potential value at $1.336 billion.

Oh, and a few more updates, too: I reported that Serco’s CEO resigned last week amid the allegations that the corporation had essentially stolen from British taxpayers. Well, now, news reports say that two more staffers at Serco-run Yarl’s Wood have just been fired for having sex with a detained woman, and a third was fired for doing nothing when the woman reported what they had done. That’s after three Serco staffers were fired last year for inappropriate sexual conduct, and after Serco paid an undisclosed sum to a Pakistani woman who said she was sexually assaulted, though the corporation never admitted liability.

By the way, I’ll be talking about this story with Lou Dobbs at 7:30 tonight, and with Greta Van Susteren at 7:45. Tune in!

Jillian Kay Melchior — Jillian Kay Melchior writes for National Review as a Thomas L. Rhodes Fellow for the Franklin Center. She is also a senior fellow at the Independent Women’s Forum.

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