Section 4: DBE Fraud Indicators
Anchor: #i1000419DBE Fraud Indicators
The LG will report any false, fraudulent, or dishonest conduct in connection with the DBE program to the USDOT Office of the Inspector General (OIG) for appropriate action. The OIG looks at ten key indicators, or “red flags,” in determining whether to investigate a contractor for DBE fraud. These red flags include:
- Anchor: #OTRLCVXT
- DBE firm’s owner lacking background, expertise or equipment to perform subcontract work Anchor: #CNYNPJAJ
- Employees shuttling back and forth between prime contractor and DBE-owned business payrolls Anchor: #OIGQGRHE
- Business names on equipment and vehicles covered with paint or magnetic signs Anchor: #CKXCGXBE
- Orders and payment for necessary supplies made by individuals not employed by DBE- owned business Anchor: #FYLXGJMH
- Prime contractor facilitated purchase of DBE-owned business Anchor: #LAHDFTYN
- DBE owner never present at job site Anchor: #PWTNCXFV
- Prime contractor always uses the same DBE Anchor: #NURVAHCK
- Financial agreements between prime contractor and DBE contractors Anchor: #GQQIWVOV
- Joint bank accounts (prime contractor/DBE) Anchor: #HBYARGVF
- Absence of written contracts
Under 49 CFR, Part 26.107, businesses working in the DBE program who engage in the conduct may be subject to suspension or debarment, enforcement actions under 49 CFR Part 31, Program Fraud and Civil Remedies, or criminal prosecution. USDOT OIG makes investigating and prosecuting DBE fraud a priority. The OIG, working with U.S. Attorney’s offices has helped to create successful criminal prosecution for fraudulent conduct in the DBE program. Anyone who becomes aware of fraud, waste, or abuse in these programs should inform the OIG as well as TxDOT staff.
Anchor: #i1000484Reporting Fraud
TxDOT has established a hotline for employees, contractors, and others to report suspected fraud or abuse. The TxDOT Watch reporting system allows individuals to anonymously report suspected unethical and illegal activities within the agency in one of two ways:
- Anchor: #LFVSWPJO
- Report incidents by visiting TxDOT Watch Anchor: #IYQSVISK
- Call toll-free (877) 769-8936.