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UPDATE: CONGRESSMAN ASKS FOR VA CORRESPONDENCE WITH PRINCIPI'S

FIRM -- SAYS CONTRACT "APPEARS TO BE A POOR DEAL FOR TAXPAYERS"

AND WANTS TO KNOW WHY OTHER FIRMS WEREN'T NOTIFIED

WHEN CONTRACTS WERE UP FOR BID

The Principi / QTC story has legs...as they say in the news business.

Background here... http://www.vawatchdog.org/old%20newsflashes%20APR%2006/newsflash04-23-2006-6.htm

Today's story here... http://www.latimes.com/news/nationworld/nation/la-na-va26apr26,1,3512788.story?coll=la-headlines-nation&ctrack=1&cset=true

Today's story below:

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VA Communications With Firm Sought

By Walter F. Roche Jr., Times Staff Writer
April 26, 2006

WASHINGTON — The secretary of the Department of Veterans Affairs has been asked to produce records of communications between VA officials and a California company with a long-term, multimillion-dollar contract to perform medical exams for veterans seeking disability assistance.

In a letter sent Tuesday to Veterans Affairs Secretary Jim Nicholson, Rep. Henry A. Waxman (D-Los Angeles) asked for copies of all communications between top agency officials and QTC Management Inc. of Diamond Bar.

Stating that the QTC contract "appears to be a poor deal for the taxpayers," Waxman asked for records of any communications between the company and former VA Secretary Anthony J. Principi. Principi was president of QTC before joining the Cabinet in January 2001, and returned to the firm in December 2005 as chairman of its board.

Waxman also asked for records of communications between anyone else in Principi's office or other political appointees within the agency and QTC.

Principi has stated that he recused himself from all matters involving QTC while he served as VA secretary.

The Times reported Sunday that VA payments to QTC jumped from $8 million in 1998 to $69 million in 2005. Other firms have complained that the VA did not notify them that the contract for the disability exams was up for bid, despite their requests to be notified, Waxman noted.

The Times reported that QTC was paid $246 million during Principi's Cabinet tenure.

Waxman also asked for summaries "of any oral communications between representatives of QTC Management and these officials."

"Regardless of whether ethical or contracting rules were violated, the appearance of impropriety can have a damaging effect on public confidence in the department. This appearance can be mitigated by full disclosure," Waxman's letter stated.

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Larry Scott

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