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New Country Ordinance Would Prohibit Minoriy Firms Acting as "Do Nothing Brokers" on Contracts
President Stroger Called Upon to Revamp Contract Compliance Office

Monday, May 23, 2005
Special to

Would follow City of Chicago in prohibiting MBE “brokers” buying goods from manufacturers and reselling them to the county at a higher cost.

Cook County Commissioners Larry Suffredin (D-Evanston) and Forrest Claypool (D-12th Chicago) are proposing an Ordinance prohibiting companies in the county minority set-aside program from acting merely as “brokers”, buying goods from manufacturers and reselling them to the county at a higher price.

This comes on the heels of Daily Southtown revelations that Faustech, which has been barred from doing business with the City of Chicago and was ruled a do-nothing broker in 1998 by a U.S. judge on a $49 million dollar Stroger Hospital contract, is now allegedly out of business as of May 1 and had refused to be recertified under the County MBE ordinance.

Faustech is also at the center of an ongoing federal criminal investigation about the same $49 Million deal, abrogated by a federal judge.

Commissioner Suffredin stated, “Faustech’s participation in the County’s minority program as a broker defeats the purpose of the program and defrauds the county and all legitimate minority businesses.”

Unlike the City of Chicago, the Cook County minority business program allows the practice of “brokering” contracts.

“When companies like Faustech are allowed to operate as mere fronts, without providing anything of value, they make a mockery of the minority set aside program,” said Claypool. “The program’s purpose is to help build legitimate minority businesses grow, not put tax dollars in the pockets of politically-connected businessmen.”

When questioned by commissioners if Faustech cheated the county’s minority set aside program this past Tuesday, Cook County contract compliance administrator Betty Hancock Perry claimed both through a letter and live testimony that there were no problems.

Based on Hancock Perry’s report and site visit that certified Faustech as a legitimate minority owned business, the Cook County Board of Commissioners approved payments on a computer contract.

Upon finding out that no one from Hancock Perry’s office had performed a site visit on Faustech since 1998, however, Commissioner Suffredin said: “I feel absolutely misled, I feel betrayed.” Perry never mentioned that Faustech had indicated it did not which to be recertified.

Faustech sent a letter dated April 27 to the county saying it did not want to participate in the county’s minority set-aside program, yet it still has five open contracts with the county worth $233,000.

The Ordinance will be introduced at the next Cook County Board of Commissioners meeting on June 7th.

In addition, Commissioners Claypool and Suffredin have sent President John H. Stroger, Jr. a letter demanding that he immediately revamp the Contract Compliance Office to make it a truthful and accurate investigator of issues before it. The Faustech and the earlier Crucial Communication( were ownership and control problems were only discovered after press inquiries) cases have brought to light the current Contract Compliance Office’s inability to investigate facts key to meeting a County Policy intended “to eliminate arbitrary barriers to full and equitable opportunities for participation…as MBE’s and WBE’s”

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