From saic at vision.moundalexis.com Tue Feb 1 14:02:05 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Tue, 1 Feb 2005 09:02:05 -0500 (EST) Subject: [saic] Andrews named COO at SAIC Message-ID: <20050201090136.J488-100000@vision.moundalexis.com> February 1, 2005 Andrews named COO at SAIC http://www.signonsandiego.com/news/business/20050201-9999-1b1calbrfs.html --- San Diego-based SAIC named Duane P. Andrews as chief operating officer. Andrews, who previously served as the head of SAIC's federal contracting business, will continue to serve on the company's board of directors. Prior to joining SAIC in 1993, Andrews was assistant secretary of defense for command, control, communications and intelligence. From saic at vision.moundalexis.com Thu Feb 3 03:00:47 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Wed, 2 Feb 2005 22:00:47 -0500 (EST) Subject: [saic] Air Force Dogs SAIC for Alleged Profit Padding, and Company Denies It Message-ID: <20050202220000.E488-100000@vision.moundalexis.com> 2/1/2005 3:43:00 PM Air Force Dogs SAIC for Alleged Profit Padding, and Company Denies It http://releases.usnewswire.com/GetRelease.asp?id=42439 --- To: National Desk and Business Editor Contact: Michael Lent of Government Services Insider, 202-237-0765 or mlent at gsinsider.com WASHINGTON, Feb. 1 /U.S. Newswire/ -- Emerging from almost three years of secrecy, a lawsuit accusing SAIC of false claims and other fraud has led the Air Force to issue an "alert" concerning the company. The unusual written notice calls on Air Force contracting officials worldwide to demand in writing price proposal backup data that reveals the details of how SAIC allegedly compensates for the business risks of performing fixed- price tasks. The Air Force alert arose from a Justice Department civil lawsuit against SAIC that had originated as a False Claims Act suit brought in January 2002 by a former SAIC employee. The allegations concern the costing and pricing of eight fixed-price delivery orders worth $24 million that were negotiated between 1995 and 2000 under a contract for environmental remediation work at Kelly Air Force Base. Court documents show that SAIC is vigorously contesting the False Claims Act lawsuit. It has moved to dismiss the case, but that motion hasn't been ruled on yet. SAIC declined direct comment on the lawsuit due to the ongoing litigation. However, the company released to the Insider a copy of a strongly worded letter to the Air Force delivered two days after the alert was issued on Dec. 20, 2004. The letter asserted that the Justice position in the lawsuit was "factually incorrect and legally unfounded." It goes on to say that "the Alert effectively 'convicts' SAIC without the benefit of a fair hearing and...implies that SAIC is a dishonest and corrupt company that must be avoided at all costs." The letter defends the firm's reputation and urges that the alert be withdrawn or amended. Neither action has been taken. The Air Force declined comment due to the ongoing litigation. In the lawsuit, the government alleges that SAIC used "Quantitative Risk Analysis" and "variance hours" to inflate its labor estimates to compensate for such risks as "internal inefficiencies, inoperable equipment, or anticipated schedule delays." The company then allegedly included these cost elements in the proposed price, according to the government's case. The Air Force alert also cites unspecified Department of Justice "evidence" that SAIC, using the "variance hours" approach, allegedly achieved profit margins of 20 percent to 40 percent, compared with profit margins of about 9.5 percent that the firm proposed to the Air Force. Further, the Air Force alert asserts that the company has told Justice "that it intends to continue using Quantitative Risk Analysis and variance hours" without disclosing them. In lawsuit pleadings predating the alert, SAIC explained in exhaustive detail its position that neither the Truth in Negotiations Act (TINA) nor regulations required such disclosure in the proposals at issue that the government now demands. An SAIC spokesman told the Insider that the company's risk management approach in fixed-price work is "common industry practice." He also said SAIC policy is to comply fully with the law and other requirements regarding disclosure. He stopped short of characterizing other firms' practices on disclosure of supporting information in price proposals. In the False Claims Act case, former SAIC employee and project manager Michael D. Woodlee detailed how the company allegedly prepared it's cost and price proposals. Concerned about the firm's practices, Woodlee complained twice to the firm's ethics committee, but no action was taken, according to the lawsuit. In addition to claiming that SAIC made "false or fraudulent claims for payment or approval," the Justice lawsuit contains five additional counts: violation of TINA, "misrepresentations" of costs that led the government to agree to higher prices, "breach of contract," "unjust enrichment," and causing the government to mistakenly disburse funds to SAIC. Trial is scheduled for Jan. 17, 2006, in federal district court in San Antonio. The alert says SAIC has "approximately $513 million" worth of Air Force contracts. The company's Web site notes that SAIC is one of the "top ten" Air Force contractors. However, fresh DoD data released last Friday ranks SAIC as 18th in Air Force prime contract awards, winning $397 million in federal fiscal year 2004. In its fiscal year closing Jan. 31, 2004, employee-owned SAIC reported $6.7 billion in revenue. For the fiscal year ending yesterday, based on reports of at least 15 percent growth, revenues are estimated at $7.5 billion to $8.0 billion. From saic at vision.moundalexis.com Thu Feb 3 03:03:12 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Wed, 2 Feb 2005 22:03:12 -0500 (EST) Subject: [saic] SAIC: FBI should deploy case management system Message-ID: <20050202220220.W488-100000@vision.moundalexis.com> 02/02/05 SAIC: FBI should deploy case management system http://www.washingtontechnology.com/news/1_1/daily_news/25462-1.html --- By Wilson P. Dizard III PostNewsweek Tech Media Science Applications International Corp. said Tuesday that it has urged the FBI to fully deploy the Virtual Case File case management system the San Diego company has provided in a pilot version. The troubled VCF project has been the subject of several critical reports and investigations by the Government Accountability Office, the Justice Department Inspector Generals Office, the National Science Foundation and Congress. We certainly believe they could deploy VCF, said Mark Hughes, president of SAICs system and network solutions group. He said scuttling VCF, a move the FBI is considering upon recommendations from the Justice IG, would delay the bureaus adoption of modern case-management software by three years or more. The FBI has paid SAIC $113 million for VCF so far, Hughes said. The bureau has said it budgeted $170 million for the case-management system. Hughes rejected the conclusion of a report by Aerospace Corp., prepared under contract to the FBI and delivered in December, that VCF should be abandoned. The Justice Department IG also has said that VCF is inadequate and should be abandoned in favor of a new system, called the Federal Investigative Case Management System. SAIC won its contract to build VCF in June 2001, Hughes said. After six months of work, the bureau entirely revised its requirements for the project, rendering the first few months effort useless, he said. FBI systems officials have referred to the projects initial phase, during which the goal was to furnish a graphical user interface for FBI systems, as putting lipstick on a pig. Hughes elaborated on previous statements by SAIC executives that the bureaus shifting requirements and frequent management changes during the VCF project hindered the effort. He added that SAIC itself bears some responsibility for the projects problems. We should have communicated with the FBIs senior levels more aggressively than we did, Hughes said. We believe there was good communication with our direct interfaces, but we should have communicated better at the higher levels to make sure we were on the same page. Hughes said SAIC might have taken some risky steps to speed the project because the bureau said it was so critical. We established eight different programming teams operating in parallel, he said. It was very hard to coordinate the activities of these eight different teams. We could have done a better job of that. The ultimate test is that we delivered a product in December that does what it is supposed to do, Hughes said. We also did stress testing and modeling on the system, and we believe it can be scaled up to [deployment across] the full FBI. If the bureau decides to deploy VCF, the FBI eventually will be able to stop relying on its outdated Automated Case File System case-management software and phase in additional VCF functions, Hughes said. I think most of the capabilities we have designed and coded can be deployed within a year, he said. The company and the bureau renegotiated the VCF contract in mid-2004 and arrived at a requirements document that would not be changed through December, Hughes said. We went through a thorough process called alpha contracting, which was a way for SAIC and the customer to talk in-depth and make sure there were no misunderstandings. That worked very well, he said. FBI officials were not immediately available to respond to SAICs statements. The Senate Appropriations Subcommittee on Commerce, State and the Judiciary has scheduled a hearing for Thursday afternoon to air VCF issues. Bureau Director Robert Mueller, CIO Zalmai Azmi, and representatives of Aerospace and SAIC are scheduled to testify. From saic at vision.moundalexis.com Fri Feb 11 23:52:47 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Fri, 11 Feb 2005 18:52:47 -0500 (EST) Subject: [saic] California defense contractor warns employees following computer theft Message-ID: <20050211185125.P488-100000@vision.moundalexis.com> Feb 3 2005 3:16PM California defense contractor warns employees following computer theft http://www.securityfocus.com/news/10419 --- Thieves stole several computers containing personal information on 45,000 current and former shareholders of defense contractor Science Applications International Corp., which began alerting those people on Thursday. SAIC is one of the nation's largest employee-owned companies. The computers stolen from an SAIC administrative building in San Diego contained the name, Social Security number, address and telephone number of current and former shareholders, including the number of shares bought, held and sold. The company said it had no evidence that the thieves accessed the information or that the purpose of the crime was identity theft, but began notifying current and former shareholders as a precaution. "We're extremely concerned. This is a very serious matter. We're taking every precaution we know how," SAIC spokesman Ben Haddad said Thursday. Thieves smashed three ground-floor windows and pried open the doors to 13 offices early on Jan. 25, San Diego police Detective Gary Hassen said. No government or commercial work was performed at the building where the break-in occurred. SAIC, which has annual revenue of about $7 billion, is involved in some of the U.S. government's most sensitive work, from redesigning Army combat systems to bioweapons defense and improving electronic snooping for the National Security Agency. Employees of the San Diego-based company can buy and sell shares among themselves once every three months at a price fixed by an outside auditor, based on SAIC's operating income and competitors' stock prices. The computers contained the information of tens of thousands of people who bought or sold SAIC shares in the past several years, Haddad said. SAIC is reassessing its security procedures. From saic at vision.moundalexis.com Fri Feb 11 23:53:33 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Fri, 11 Feb 2005 18:53:33 -0500 (EST) Subject: [saic] SAIC exec defends work on FBI software Message-ID: <20050211185248.P488-100000@vision.moundalexis.com> February 5, 2005 SAIC exec defends work on FBI software http://www.signonsandiego.com/news/business/20050205-9999-1b5saic.html --- WASHINGTON Arnold L. Punaro, a top executive at SAIC, listened quietly Thursday in a Senate hearing room as FBI director Robert Mueller chastised his company for developing $170 million in software that the FBI might scrap. The San Diego defense contractor, also known as Science Applications International Corp., has been flayed for its role in the problem-riddled computer system, part of a program that has cost almost $600 million so far. Punaro came prepared to tell his side of the story. But just before it was Punaro's turn to speak before the Senate appropriations subcommittee, the panel's chairman, Sen. Judd Gregg, R-N.H., said he had to adjourn the session because the senators had other commitments. Another hearing has not yet been scheduled. As reporters lingered afterward, though, Punaro said SAIC had fixed problems in the heavily criticized software it developed to help the FBI track terrorists and manage criminal cases. "We fully conformed to the contract we have and gave the taxpayers real value for their money," said Punaro, an executive vice president at SAIC. He blamed the FBI for the initial problems, saying the agency had a parade of program managers and demanded too many design changes. During 15 months that SAIC worked on the program, 19 government managers were involved and 36 contract modifications were ordered, he said. "There were an average of 1.3 changes every day from the FBI, for a total of 399 changes during the period," Punaro said. His vigorous defense of SAIC immediately followed an appearance by Mueller on Capitol Hill, during which the FBI director sharply criticized SAIC's performance on the contract. SAIC's custom software, known as Virtual Case File, was intended to help FBI agents and analysts track terrorists and manage criminal investigations. When SAIC delivered the product, at least 400 problems were found with the software, Mueller testified. "We immediately identified a number of deficiencies that made it unusable," he said. Mueller said officials are still trying to determine how much of the program may be salvaged. A small version of the program is being evaluated in the FBI's New Orleans office. Punaro said he was disappointed he didn't have a chance to rebut Mueller's testimony Thursday. "We understand the circumstances in U.S. Senate scheduling, but we were fully prepared to put our case forward," Punaro said after the hearing. Problems with the software made by SAIC were the latest development in a three-part program known as Trilogy, which has run up an overall price tag of nearly $600 million since the contracts were awarded in 2001. Trilogy was intended to overhaul the FBI's aging computers with a secure, high-speed network that called for installing 500 computer network servers, 1,600 scanners and thousands of desktop computers in FBI field offices. After the FBI initially determined there were flaws in the program, an independent consultant, Aerospace Corp., reviewed the SAIC software at a cost of $2 million and determined it should be abandoned. It found a "lack of effective engineering discipline has led to inadequate specification, design and development of VCF," Mueller said. Reacting to the report, Mueller said, "After three and a half years, this was disappointing news." Punaro criticized the Aerospace report, saying, "We have a strong disagreement with the conclusions." Among other things, Aerospace Corp. based its conclusions on an early software program that is a year out of date, Punaro said. "It was preliminary delivery and it did have some problems. However, we worked with the FBI and got on top of those," he said. Mueller indicated that the FBI might try to get back some of the more than $100 million it has paid to SAIC, which won its contract in June 2001. "We are currently reviewing the Aerospace reports which recommend that we discard VCF (Virtual Case File)," Mueller said. "We will continue to consult with industry leaders to ensure that we develop a sound, long-term plan for our (technology) needs." Committee members weren't so sure. "My disappointment with the extreme waste of taxpayer dollars over $100 million is surpassed only by my frustration over the fact that we now do not know when the FBI will have this critical case management system in place," said Gregg, chairman of the Senate commerce, justice and state subcommittee. Meanwhile, the Justice Department's Inspector General also criticized the FBI's handling of the software, saying it had not provided a timetable for completing it. "The critical need to replace the FBI's obsolete case management system remains," the inspector general's report said. "In our view, the main responsibility for the problems with Trilogy rests with the FBI." From saic at vision.moundalexis.com Fri Feb 11 23:54:20 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Fri, 11 Feb 2005 18:54:20 -0500 (EST) Subject: [saic] SAIC to FBI: Use our system Message-ID: <20050211185334.S488-100000@vision.moundalexis.com> 02/07/05; Vol. 20 No. 3 SAIC to FBI: Use our system http://www.washingtontechnology.com/news/20_3/datastream/25493-1.html --- Science Applications International Corp. is urging the FBI to fully deploy the Virtual Case File case management system the San Diego company provided in a pilot version. The troubled VCF project has been the subject of several critical reports and investigations by the Government Accountability Office, the Justice Department Inspector General's Office, the National Science Foundation and Congress. "We certainly believe they could deploy VCF," said Mark Hughes, president of SAIC's system and network solutions group. Scuttling VCF, a move the FBI is considering upon recommendations from the Justice IG, would delay the bureau's adoption of modern case-management software by three years or more, he said. The FBI has paid SAIC $113 million for VCF so far, Hughes said. The bureau said it budgeted $170 million for the case-management system. Hughes rejected conclusions of Aerospace Corp.'s December report, prepared for the FBI, that VCF should be abandoned. The Justice IG also has said that VCF is inadequate and should be abandoned in favor of a new system, the Federal Investigative Case Management System. Hughes elaborated on previous statements by SAIC executives that the bureau's shifting requirements and frequent management changes during the project hindered the effort. But SAIC bears some responsibility for the project's problems, he said. "We should have communicated with the FBI's senior levels more aggressively than we did," he said. From saic at vision.moundalexis.com Fri Feb 11 23:55:40 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Fri, 11 Feb 2005 18:55:40 -0500 (EST) Subject: [saic] Boffins to decide future of .net domains Message-ID: <20050211185421.D488-100000@vision.moundalexis.com> Published Tuesday 8th February 2005 16:48 GMT Boffins to decide future of .net domains http://www.theregister.co.uk/2005/02/08/boffins_on_dotnet/ --- By Kieren McCarthy ICANN has named the people that will decide who gets to run all .net Internet domains from July. Two weeks after the deadline ended for applications to run all 5.1 million .net addresses, revealing five contendors, telco Telcordia has been revealed as the evaluator. A team of ten from Telcordia, headed by Internet veteran Dr David Sincoskie will now review, analyse and visit the premises of each bidder: Afilias, Core++, Denic, Santan and VeriSign. ICANN has gone to great lengths to make sure that the already heated process is as independent as possible. It stressed the team's credentials, calling it an "international panel of DNS experts [which] possesses 270 years of collective industry experience, with particular emphasis in networks, information databases, security and operations". ICANN has been careful not to name each team member individually - something that would undoubtably have led to intense lobbying and possibly even character assassination. But it has revealed that the evaluation team "includes two IEEE Fellows; a member of the National Academy of Engineering; a multi-cultural/multi-national composition, with nationals ofCroatia, Greece, Pakistan, Taiwan, the UK and the US. In addition, 60 per cent of the team possesses PhDs, spanning CS, EE and Economics." On top of this, it has produced a full disclosure by Telecordia, outlining all possible links, which ICANN's chief lawyer concluded were "highly unlikely to influence any aspect of the evaluation". What ties there are would benefit incumbent operator VeriSign. The disclosure points out that Telcordia was a wholly owned subsidiary of the Science Applications International Corporation (SAIC). It fact its acquisition by Warburg and Providence has only just been approved by the EU and SAIC stills owns it at the moment. Also, the CEO of Telcordia, Matthew Desch, is on SAIC's board. As is William Roper, who appears to be a member of the evaluation team. Roper is also a director of VeriSign. Dr Sincoskie also worked for VeriSign former incarnation, Network Solutions, in 1998-1999. SAIC also owned Network Solutions / VeriSign for a fair time. This is stated in the disclosure: "Prior to 2000, SAIC had an ownership interest in Network Solutions (NSI). In June 2000, NSI merged and became a wholly-owned subsidiary of VeriSign. During 2003, SAIC sold all of its shares of VeriSign and no longer holds equity collars or an investment in VeriSign as a result of these transactions." This statement somewhat simplifies a highly controversial element of net history that often gets the conspiracy theorists going - SAIC's purchase of NSI for a ridiculously cheap sum. SAIC - itself a peculiar organisation with close links to the Pentagon - bought NSI for around $5m in stock in March 1995. Six months later, NSI was given the right by the US government to start charging for domain names - something that began at $100 for two years. Before then all domains were free to the owner and NSI was paid a flat multi-million-dollar by the US government. SAIC picked up the purchase of a lifetime when it acquired a company with a contract over all .com, .net and .org domains for the next five years for less that it was paid in one year. Five years later, NSI was sold for $19.2bn - a value increase of 3,840 per cent. Not that this intriguing bit of Net history will influence the evaluators' decision but it seems very unlikely that VeriSign will complain about the choice made by ICANN. We still believe it's a two-horse race between Denic and VeriSign. From saic at vision.moundalexis.com Fri Feb 11 23:56:53 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Fri, 11 Feb 2005 18:56:53 -0500 (EST) Subject: [saic] Government Lawsuit Accuses Contractor of Profiting From Inflated Cost Estimates Message-ID: <20050211185541.R488-100000@vision.moundalexis.com> Published: February 10, 2005 Government Lawsuit Accuses Contractor of Profiting From Inflated Cost Estimates http://www.nytimes.com/2005/02/10/national/10contractor.html?oref=login --- By ERIK ECKHOLM In a lawsuit that is being watched closely by companies and lawyers involved in the multibillion-dollar federal contracting business, the federal government has charged one of its largest contractors with padding cost estimates during negotiations, allowing the company to reap profits of 30 percent or more on jobs when it was legally entitled to profits of only 10 percent. The fraud suit against the company, Science Applications International Corporation, based in San Diego, involves a series of environmental testing and cleanup jobs it performed at Kelly Air Force Base in Texas in the late 1990's. The contracts, awarded without competitive bidding, paid the company a negotiated price of $24 million. The company says it strictly obeyed the law in negotiating its contracts. But on Friday, in a setback for the company, known as S.A.I.C., a federal judge in San Antonio rejected a motion to dismiss the case. The suit is of wider interest, legal experts say, because it addresses a practice used to varying degrees by many government contractors: overestimating projected costs when agreeing on the price upfront, economizing as work is performed and pocketing the difference. The suit focuses attention on an obscure but important corner of government contracting, where the fine print on agreements or the particulars of negotiations can have large effects on a contract's bottom line. These issues are most relevant to the large number of government contracts that are not competitively bid. "A lot of companies feel they can outsmart the government," said Andrew Grosso, a lawyer who has handled contracting lawsuits and who used to be a federal prosecutor. A government victory in the Texas litigation would not only expose S.A.I.C. to large penalties but "would send a warning to the entire industry," Mr. Grosso said. The company denies any wrongdoing, saying it uses a technique called "quantitative risk management" to project the possibility of cost overruns due to unforeseen circumstances. The government says the company increased its estimated costs during negotiation to offset those risks and did not disclose those calculations to the government. "S.A.I.C.'s policy is to fully comply with the law and to disclose all information and data, whenever required to be disclosed," said Ronald M. Zollars, a company spokesman, in an e-mailed statement. "S.A.I.C. disagrees that it provided any misleading cost or profit information to the government." Mr. Zollars added, "We believe it is a common industry practice to undertake and prepare risk analyses in estimating fixed-price work and preparing fixed-price proposals." The Justice Department, in a court document last September, said the company was obliged to tell military negotiators how it arrived at price assumptions but instead gave the Air Force cost and profit figures that the company knew were misleading. The company reported revenues of $6.7 billion and net income of $351 million for 2004. A majority of its revenues come from government contracts, many of them with the Pentagon. It has recently been criticized for its foundering effort to develop new case-management software for the Federal Bureau of Investigation. On Dec. 20, the Air Force, noting that it alone had hundreds of contracts with the company worth $513 million, warned its contracting officers to demand full disclosure of pricing assumptions in future negotiations and to disallow costs associated with hypothetical risk. On Friday, Judge William Wayne Justice of Federal District Court in San Antonio denied the company's motion to dismiss the suit. The company has pressed the Air Force to retract its warning, which it says "unfairly impugns S.A.I.C.'s ethics." The charges against the company were first brought in 2002 by a former project manager for the company in San Antonio. The former manager, Michael D. Woodlee, who filed a whistle-blower suit under the False Claims Act, says the company knowingly inflated its cost estimates, resulting in profits of as much as 60 percent on some of the jobs it carried out under a multi-year "master contract" with the Air Force. Mr. Woodlee also said that managers had been encouraged to list higher-paid employee categories on job descriptions, then use lower-paid employees to do the work. Based on information provided by Mr. Woodlee, and its own investigation of the company, the Justice Department joined in the lawsuit last September. Under the False Claims Act, the government can pursue triple damages for money falsely received, and the whistle-blower may receive a substantial reward, said Patrick Burns of Taxpayers Against Fraud, a group based in Washington. The lawsuit, while focused on the Texas contracts, accuses the company of engaging more widely in the same pricing practices. The Justice Department's brief, filed in September, said the company violated two major laws: the Truth in Negotiations Act, which requires companies to provide "accurate, complete and current" pricing data and calls for a reduction of fees if early cost data prove to be inaccurate; and the Federal Acquisition Regulation, which requires contractors to submit "any information reasonably required to explain your estimating process." The September court document also describes internal messages of the company in which San Antonio employees ask company leaders in San Diego whether they should disclose the cost buffers to the Air Force. The corporate headquarters approved the "failure to disclose," the Justice Department said. In a $2 million hazardous-waste project negotiated in 1999, the Justice Department says, the company described to the Air Force a pattern of expenses that would give it a profit of 10 percent, while internal documents at the time said the "actual profitability" would be 23 percent. Four months into the one-year contract award, according to internal company documents, the effective profit had risen to 29 percent. By the end of 2000, when the work was completed, the company found - and did not disclose to the Air Force - that its profit has risen to 54 percent, the Justice Department brief says. From saic at vision.moundalexis.com Fri Feb 11 23:57:52 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Fri, 11 Feb 2005 18:57:52 -0500 (EST) Subject: [saic] Lawsuit says SAIC inflated contracts Message-ID: <20050211185657.P488-100000@vision.moundalexis.com> February 10, 2005 Lawsuit says SAIC inflated contracts http://www.signonsandiego.com/news/business/20050210-2004-cnssaic.html --- Details emerging in three-year case By Joe Cantlupe COPLEY NEWS SERVICE February 10, 2005 WASHINGTON Years after San Diego-based SAIC won an environmental cleanup contract at San Antonio's Kelly Air Force Base, Michael D. Woodlee thought something was amiss. Woodlee, who was SAIC's project manager on the job, alleges that his company was earning far more profit on the $24 million effort than was spelled out in its fixed-price contract. Instead of making a 9.5 percent profit as set forth in one order, for example, Woodlee figured the profit at 40 percent. After SAIC's ethics committee allegedly ignored his complaints, Woodlee filed a federal whistle-blower lawsuit against the company in Texas three years ago. His allegations were filed in secret, as required under the False Claims Act. But as details of the case emerged in recent weeks, the defense contractor also known as Science Applications International Corporation is dealing with more serious ramifications of Woodlee's complaint. The Air Force took what could be the most dramatic step by issuing an unusual warning about SAIC to its contracting officials around the world. The Dec. 20 alert calls on Air Force negotiators to demand more information about SAIC's pricing, risks and labor in its bids on fixed-price contracts. The warning followed a decision by the Justice Department to take over Woodlee's lawsuit. In the suit, federal prosecutors allege that SAIC reaped an average profit of 27 percent for work done at the Kelly Air Force site, when the negotiated profit on eight separate projects ranged from 8 percent to 10 percent. SAIC has responded to the government's double whammy with a spirited defense. In a letter to the Air Force Office of General Counsel, SAIC senior vice president Douglas E. Scott said: "The allegations in the complaint are nothing more than unsubstantiated allegations, which SAIC believes to be factually incorrect and legally unfounded." SAIC officials have denied any wrongdoing by the company, saying it properly uses "quantitative risk management" to determine possible cost overruns. Scott described the Justice Department lawsuit as "clearly erroneous." But last week, William Wayne Justice, a senior U.S. district judge in San Antonio, rejected SAIC's request to dismiss the lawsuit. SAIC also has asked the Air Force to withdraw its alert and argues: "By presenting such assertions to our Air Force customers in an inaccurate and conclusory fashion, the alert effectively 'convicts' SAIC without the benefit of a fair hearing and unjustifiably impairs our reputation and business interests." The company, which reported net income of $351 million on total revenue of $6.7 billion in fiscal 2004, has $513 million in contracts with the Air Force. John W. Polk, director of fraud remedies in the Air Force Office of the General Counsel, wrote in the alert that SAIC failed to "disclose full and accurate cost or pricing data." In an interview, SAIC spokesman Jared Adams countered that, "The alert mischaracterizes the facts, issues and status of the case and unfairly impugns SAIC's ethics." The government's lawsuit against SAIC contends that the company violated the Truth in Negotiations Act and the False Claims Act. The laws require government contractors to provide accurate pricing information to their federal clients. Aside from the potential monetary damages, a violation could affect SAIC's ability to win future business with the Air Force or other government agencies, said Patrick Burns of Taxpayers Against Fraud, a group based in Washington. As a result, Burns said, government contractors across the country are watching the suit against SAIC closely. "What's being alleged is padding contracts," Burns said. "SAIC can call it whatever it wants. A lot of people are going to be looking at this." Woodlee alleged in his lawsuit that he had "direct and independent knowledge" of fraudulent practices while employed as a senior project geologist and project manager from 1994 to 2001. "SAIC devised and implemented a scheme to fraudulently inflate its profits on contracts with the federal government in the Western District of Texas," Woodlee says in the lawsuit, which he filed in 2002. Justice Department officials say in their lawsuit that the company "knowingly misrepresented and failed to disclose accurate, complete and current cost and pricing data and the truth about its expected costs and profits." According to the lawsuit, the government "believes that SAIC is continuing to submit defective cost or pricing data in support of its pricing proposals." The suit alleges that the company inflated labor, subcontractor, material and timekeeping costs. Neither Woodlee's attorneys nor the Justice Department would comment on the allegations. But SAIC's Scott wrote in a letter to the Air Force's inspector general that the company is committed to complying with all its legal obligations. "As someone well versed in the law of defective pricing, we believe you will find the Department of Justice's assertions to be, at the least, quite novel," Scott wrote to the Air Force. "We believe that an objective review of the facts and applicable law will validate our position." From saic at vision.moundalexis.com Mon Feb 21 13:13:33 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Mon, 21 Feb 2005 08:13:33 -0500 (EST) Subject: [saic] Break-In At SAIC Risks ID Theft Message-ID: <20050221081302.S400-100000@vision.moundalexis.com> Break-In At SAIC Risks ID Theft Computers Held Personal Data on Employee-Owners http://www.washingtonpost.com/wp-dyn/articles/A17506-2005Feb11.html?sub=AR By Griff Witte Washington Post Staff Writer Saturday, February 12, 2005; Page E01 Some of the nation's most influential former military and intelligence officials have been informed in recent days that they are at risk of identity theft after a break-in at a major government contractor netted computers containing the Social Security numbers and other personal information about tens of thousands of past and present company employees. The contractor, employee-owned Science Applications International Corp. of San Diego, handles sensitive government contracts, including many in information security. It has a reputation for hiring Washington's most powerful figures when they leave the government, and its payroll has been studded with former secretaries of defense, CIA directors and White House counterterrorism advisers. Those former officials -- along with the rest of a 45,000-person workforce in which a significant percentage of employees hold government security clearances -- were informed last week that their private information may have been breached and they need to take steps to protect themselves from fraud. David Kay, who was chief weapons inspector in Iraq after nearly a decade as an executive at SAIC, said he has devoted more than a dozen hours to shutting down accounts and safeguarding his finances. He said the successful theft of personal data, by thieves who smashed windows to gain access, does not speak well of a company that is devoted to keeping the government's secrets secure. "I just find it unexplainable how anyone could be so casual with such vital information. It's not like we're just now learning that identity theft is a problem," said Kay, who lives in Northern Virginia. About 16,000 SAIC employees work in the Washington area. Bobby Ray Inman, former deputy director of the CIA and a former director at SAIC, agreed. "It's worrisome," said Inman, who also received notification of the theft last week. "If the security is sloppy, it raises questions." Ben Haddad, an SAIC spokesman, said yesterday that the Jan. 25 theft, which the company announced last week, occurred in an administrative building where no sensitive contracting work is performed. Haddad said the company does not know whether the thieves targeted specific computers containing employee information or if they were simply after hardware to sell for cash. In either case, the company is taking no chances. "We're taking this extremely seriously," Haddad said. "It's certainly not something that would reflect well on any company, let alone a company that's involved in information security. But what can I say? We're doing everything we can to get to the bottom of it." Gary Hassen of the San Diego Police Department said there were "no leads." Haddad said surveillance cameras are in the building where the theft took place, but he did not know whether they caught the perpetrators on tape. He also did not know whether the information that was on the pilfered computers had been encrypted. The stolen information included names, Social Security numbers, addresses, telephone numbers and records of financial transactions. It was stored in a database of past and present SAIC stockholders. SAIC is one of the nation's largest employee-owned companies, with workers each receiving the option to buy SAIC stock through an internal brokerage division known as Bull Inc. Haddad said the company has been trying through letters and e-mails to get in touch with everyone who has held company stock within the past decade, though he acknowledged that hasn't been easy since many have since left the company. He said the company would take steps to ensure stockholder information is better protected in the future, but he declined to be specific. The theft comes at a time when the company, which depends on the federal government for more than 80 percent of its $7 billion annual revenue, is already under scrutiny for its handling of several contracts. Last week on Capitol Hill, FBI Director Robert S. Mueller III testified that the company had botched an attempt to build software for the bureau's new Virtual Case File system. The $170 million upgrade was supposed to allow agents to sift through different cases electronically, but the FBI has said the new system is so outdated that it will probably be scrapped. In San Antonio, SAIC is fighting the government over charges that the company padded its cost estimates on a $24 million Air Force contract. The case prompted the Air Force to issue an unusual alert to its contracting officials late last year, warning them that "the Department of Justice believes that SAIC is continuing to submit defective cost or pricing data in support of its pricing proposals." SAIC has defended its work for the FBI and the Air Force. Haddad said that criticisms are inevitable for a such a large company and that there is no pattern of poor performance. "I know people will try to jump to that kind of conclusion, but it's not an accurate reflection of how well this company is doing," he said. "This company has always prided itself on strong ethics." The company's alumni list reads like a roll call of the nation's highest-profile former officials, including former defense secretaries William J. Perry and Melvin R. Laird and former CIA director John Deutch. Current directors of the company include former chief counterterrorism adviser Gen. Wayne A. Downing. Founded by a group of scientists in 1969, SAIC has been growing in recent years at a rapid clip, right along with the government's appetite for high-tech services in information technology and national defense. The company named a new chief executive, Kenneth C. Dahlberg, in 2003, and he has set a goal of doubling the company's value within three to five years, Haddad said. Philip Finnegan, director of corporate analysis with Teal Group Corp., said SAIC is trying to push into the top tier of contractors -- a rarefied club that includes Boeing Co. and Lockheed Martin Corp. -- and that there are bound to be bumps along the way. "It's inevitable that they'll face problems," he said. Others are less sure that the company's recent difficulties don't add up to something more. "Is [the break-in] saying something about the quality of the company?" Kay said. "It's hard to say that. It's probably just random luck. But multiple occurrences of bad luck are often more than bad luck." From saic at vision.moundalexis.com Mon Feb 21 13:15:20 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Mon, 21 Feb 2005 08:15:20 -0500 (EST) Subject: [saic] Identity theft feared after break-in at top firm Message-ID: <20050221081502.O400-100000@vision.moundalexis.com> Sunday, February 13, 2005 - Page updated at 12:00 a.m. Identity theft feared after break-in at top firm http://seattletimes.nwsource.com/html/nationworld/2002178882_saic13.html --- By Griff Witte The Washington Post WASHINGTON . Tens of thousands of people, including some of the nation's most influential former military and intelligence officials, have been informed that they are at risk of identity theft after a break-in at a major government contractor netted computers containing Social Security numbers and other personal information. The contractor, employee-owned San Diego-based Science Applications International (SAIC), handles government contracts, including many in information security. It has a reputation for hiring Washington's most powerful figures when they leave the government, and its payroll has been studded with former secretaries of defense, CIA directors and White House counterterrorism advisers. Those former officials . along with the rest of a 45,000-person workforce in which a significant percentage of employees hold government-security clearances . were informed this month that their private information may have been breached and they need to take steps to protect themselves from fraud. The company's alumni list reads like a roll call of the nation's highest-profile former officials, including former Defense secretaries William Perry and Melvin Laird and former CIA Director John Deutch. Current directors of the company include former chief counterterrorism adviser Gen. Wayne Downing. David Kay, chief weapons inspector in Iraq after nearly a decade as an executive at SAIC, said he has devoted more than a dozen hours to shutting down accounts and safeguarding his finances. He said the successful theft of personal data, by thieves who smashed windows to gain access, does not speak well of a company that's devoted to keeping the government's secrets secure. "I just find it unexplainable how anyone could be so casual with such vital information," said Kay, who lives in northern Virginia. "It's not like we're just now learning that identity theft is a problem." Ben Haddad, an SAIC spokesman, said Friday that the Jan. 25 theft occurred in an administrative building where no sensitive contracting work is performed. Haddad said the company does not know whether the thieves targeted specific computers containing employee information, or if they simply were after hardware to sell for cash. In either case, the company is taking no chances. "We're taking this extremely seriously," Haddad said. "It's certainly not something that would reflect well on any company, let alone a company that's involved in information security. But what can I say? We're doing everything we can to get to the bottom of it." The stolen information included names, Social Security numbers, addresses, telephone numbers and records of financial transactions. It was stored in a database of past and present SAIC stockholders. Haddad said the company has been trying through letters and e-mails to contact everyone who has held company stock within the past decade. From saic at vision.moundalexis.com Mon Feb 21 13:22:21 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Mon, 21 Feb 2005 08:22:21 -0500 (EST) Subject: [saic] ASPRS Announces 2005 SAIC/Estes Memorial Teaching Award Winner Message-ID: <20050221082142.T400-100000@vision.moundalexis.com> Monday, 14 February 2005 ASPRS Announces 2005 SAIC/Estes Memorial Teaching Award Winner http://www.mapuser.com/content/view/2308/ --- Dr. Thomas M. Lillesand, Director of the Environmental Remote Sensing Center (ERSC) and Chair of the Environmental Monitoring Graduate Program at the University of Wisconsin-Madison, was awarded the 2005 SAIC/Estes Memorial Teaching Award for over 30 years of excellence in teaching remote sensing, mentoring graduate students, and being the lead author of one of the most widely used remote sensing textbooks in the world, Remote Sensing and Image Interpretation, 5th edition. The SAIC Estes Memorial Teaching Award was inaugurated in 2003 and is named in honor of Professor John E. (.Jack.) Estes, teacher, mentor, scientist, and friend of the American Society for Photogrammetry and Remote Sensing. This award is designed to recognize individual achievement in the promotion of remote sensing and GIS technology, and applications through educational efforts. Award recipients are chosen based on documented excellence in education, teaching, mentoring and, training. The Award will be presented in March at the ASPRS 2005 Annual Conference in Baltimore, Maryland with funding provided by Science Applications International Corporation (SAIC) and consists of a presentation plaque and a cash award of $2,000. Lillesand began his academic career in the mid 1960s as an undergraduate student at UW-Madison. He obtained his Bachelor.s of Science Degree in Civil Engineering in 1969, his Master.s of Science Degree in Civil Engineering specializing in Photogrammetry in 1970 and his Doctoral Degree in Remote Sensing in 1973, all from UW-Madison. From 1973 to 1978, he taught remote sensing at the State University of New York College of Environmental Science and Forestry, and from 1978 to 1982, as an associate than then full professor at the University of Minnesota. In 1982, he accepted the position of Director of the Environmental Remote Sensing Center at the University of Wisconsin-Madison. Lillesand has more than 125 publications in his fields of interest that include remote sensing, natural resource management, image processing of high resolution satellite image data, GIS, large area land mapping from space, environmental monitoring, the national space policy and transportation applications of remote sensing. He, along with Ralph W. Kiefer and more recently, Jonathan W. Chipman, co-authored Remote Sensing and Image Interpretation; now in its 5th edition (2004). He was President of ASPRS in 1998 and has received the following ASPRS awards: the Alan Gordon Award for Significant Achievements in Remote Sensing, the Talbert Abrams Award for Excellence in Authorship and Recording of Scientific Development in Photogrammetry, and the Fellow Award. He currently serves as President of the Board of Trustees of the ASPRS Foundation. In addition, he has earned the Earl J. Fennell Award for Outstanding Contributions to Education in the Mapping Sciences and the Higher Education Award from NASA and the Wisconsin Space Grant Consortium. Lillesand sits on the Science Advisory Panel for the Earth Observing System Land Process Distributed Active Archive at the EROS Data Center and on the Academic Board of the John C. Stennis Space Center. Lillesand continues to enthusiastically welcome the opportunity to work with students who, in his words, .recognize the special responsibility and challenge involved in the application of remote sensing technology to the solution of the present and prospective environmental problems confronting humankind.. Founded in 1934, ASPRS is an international professional organization of 6,500 geospatial data professionals. ASPRS is devoted to advancing knowledge and improving understanding of the mapping sciences to promote responsible application of photogrammetry, remote sensing, geographic information systems and supporting technologies. From saic at vision.moundalexis.com Mon Feb 21 13:24:19 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Mon, 21 Feb 2005 08:24:19 -0500 (EST) Subject: [saic] ID-theft alert follows break-in at federal contractor Message-ID: <20050221082313.S400-100000@vision.moundalexis.com> Published on ZDNet News: February 14, 2005, 1:18 PM PT ID-theft alert follows break-in at federal contractor http://news.zdnet.com/2100-1009_22-5575861.html --- By Robert Lemos CNET News.com Government contractor Science Applications International Corp. warned stockholders on Monday that their personal information may be at risk, after desktop computers holding the information were stolen from the company's offices. The theft happened Jan. 25, according to the company, and affects current and former stockholders. SAIC stressed in its statement that the information may not have been the target. "We have no evidence that the thieves have accessed any personal information on these computers or that the purpose of the crime was identity theft," the company said. Worries about what happens to private data housed in stolen personal computers have been highlighted before. In December, thieves stole a laptop from a California blood bank, putting in jeopardy as many as 100,000 individuals' personal records. Intruders broke into computers at the University of California, Berkeley, last year and filched 1.4 million database records containing identity information. The latest incident is a black eye for SAIC, as the company handles many security contracts for the government. It stressed, however, that the security incident occurred at an administrative facility, not at a building where any government or commercial contracts are handled. The company has also sent e-mail notifications to those affected and has established a help desk to field queries on the matter. "We are troubled that this event has occurred but are working round the clock to mitigate any impact on our stockholders," SAIC said in its release. From saic at vision.moundalexis.com Mon Feb 21 13:26:06 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Mon, 21 Feb 2005 08:26:06 -0500 (EST) Subject: [saic] High Tech Veteran Joins Secure Mobility Management Leader.s Board Message-ID: <20050221082526.I400-100000@vision.moundalexis.com> February 15, 2005 High Tech Veteran Joins Secure Mobility Management Leader.s Board http://www.prweb.com/releases/2005/2/prweb207808.htm --- Innerwall Corporation, a leading provider of secure mobility management solutions, announced today that Vincent N. Cook has joined the Innerwall Board of Directors (BoD). Mr. Cook also serves as CEO for Cook Enterprises Inc. and International Partners, a Colorado company. He is currently a Colorado Commissioner of Science and Technology, concentrating on Homeland Security solutions. Colorado Springs, CO (PRWEB) February 15, 2005 -- Mr. Cook is a former IBM Corporate Officer where he held various senior executive positions, which included both Chief Operating Officer for Asia Pacific and President of IBM Federal Systems. He has also served on the U.S. Defense Science Board for eight years and was appointed to President Regan.s National Security Telecommunications Advisory Board. He later retired as Vice Chairman of Science Application International Corporation (SAIC) and has served on the SAIC BoD (Emeritus). "I am honored to have an individual like Vince join our team," said Frank Ricotta, CEO. "As Innerwall continues to grow we look forward to leveraging the expertise he brings to the board." "Innerwall is at an exciting space and I look forward to helping them expand their presence in the government and international market," said Cook. "I believe that their unique technology can have a major impact on our national security." From saic at vision.moundalexis.com Mon Feb 21 13:47:42 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Mon, 21 Feb 2005 08:47:42 -0500 (EST) Subject: [saic] Identity Theft of Many SAIC Employees Message-ID: <20050221082719.D400-100000@vision.moundalexis.com> Identity Theft of Many SAIC Employees Privacy | Posted by Zonk on Sunday February 13, @02:44PM from the not-like-losing-your-wallet dept. http://yro.slashdot.org/article.pl?sid=05/02/13/185234&from=rss --- Rick Zeman writes "In the wake of the Geoge Mason University identity theft comes another: SAIC, an employee-owned company, has had a break-in which '...netted computers containing the Social Security numbers and other personal information about tens of thousands of past and present company employees.' These employees include anyone who's owned SAIC stock, and since it's an employee-owned company, that's most of them, including 'some of the nation's most influential former military and intelligence officials.'" From saic at vision.moundalexis.com Mon Feb 21 13:49:17 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Mon, 21 Feb 2005 08:49:17 -0500 (EST) Subject: [saic] We still haven't learned Message-ID: <20050221084906.X400-100000@vision.moundalexis.com> Thu, Feb. 17, 2005 We still haven't learned http://www.ledger-enquirer.com/mld/ledgerenquirer/news/local/10919535.htm --- When we hear "federal contract," many of us immediately think about $600 screwdrivers and $800 toilet seats, and all manner of questionable contracts and awards. That's exactly what came to mind with the revelation of the recent break-in at Science Applications International Corp., during which computers -- containing the personal information of thousands of people who have government security clearances -- were taken. According to published reports, SAIC has a reputation for hiring some of Washington, D.C.'s most powerful, including former secretaries of defense, CIA directors and White House advisers. Yet thieves were able to get their hands on computers with priceless databases -- names, addresses, telephone numbers, Social Security numbers and records of financial transactions -- and we've yet to hear an explanation that explains anything. There might be no need for the rest of us to concern ourselves with any of these big-shot, double-dipping, quid pro quo dealings, except for the fact that it is a major example of how vulnerable we really are. After the terrorist attacks, we supposedly went on the defensive in this country. We have the U.S. Patriot Act and Homeland Security to gnaw at our rights as citizens, yet we have such a blatant lack of security in the SAIC incident. Also, with the omnipresent risk of identity theft, how could this kind of information be taken by simply breaking some windows? The real reason may surface if we ever learn the whole story. Until then, we might find some partial answers by looking at the way we do business in this country. After we down-sized our companies to near-anemia, we found that outsourcing could further increase the bottom line. In the process, however, some companies learned the hard way they couldn't depend on contractors not to also cut corners to maximize their own bottom line. For example, after the terrorist attacks, a closer look was taken at airport security personnel, their backgrounds and the training they were given. According to reports, however, some airport security contractors had made a practice of hiring people and sending them directly to work with little more than directions to the airports they were being paid to make safe. Fast-forward to the SAIC break-in, and it's the same kind of laxity. In published reports a spokesperson said though surveillance cameras were in place, he did not know whether the perpetrators were caught on film. He also did not know if the information on the stolen computers was encrypted. Initially, many of us believed terrorists were able to attack this country because we didn't think anyone would attack us. Over time we've been told differently: We were ill-informed; we didn't act on information; we ignored red-flag incidents. Simply put, we didn't do things we knew we should have been doing. And it's still going on. From saic at vision.moundalexis.com Mon Feb 21 13:50:39 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Mon, 21 Feb 2005 08:50:39 -0500 (EST) Subject: [saic] SAIC Break-in Stresses Intertwined Nature of Physical and IT Security Message-ID: <20050221084947.S400-100000@vision.moundalexis.com> Updated: February 18th, 2005 09:33 AM EDT SAIC Break-in Stresses Intertwined Nature of Physical and IT Security http://www.securityinfowatch.com/article/article.jsp?id=3110&siteSection=306 --- Thieves broke windows to access building, made off with computers containing personal data on current and former stockholders Geoff Kohl, editor SecurityInfoWatch.com A break-in at a government contractor's offices has opened 45,000 former and current employees and stockholders up to identity theft. In the break-in, which occurred at Science Applications International (SAIC), thieves grabbed SAIC computers that are believed to have contained personal data such as social security numbers. The company, which experienced the break-in at one of its facilities on Jan. 25 in San Diego, saw the loss of information from numerous computers that were stolen. The computers included private data on stockholders according to an annoucement SAIC made on its website and released to its stock-holder community of the employee-owned company. According to SAIC, "the stolen computers contained personal information of current and former stockholders, including name, social security number, address, telephone number and stockholder records, including shares bought, sold and held." The break-in surprised many, especially since much of SAIC's work involved security consulting for the Department of Homeland Security and information security. In a Washington Post article, Iraq weapons inspector David Kay, who was one of the former executives at SAIC and a subsequent victim of the crime, asked why a company whose duties entailed national security would operate in a manner that simply allowed thieves to break windows and steal the company's computers. This crime event, which occurred at a building that had surveillance cameras, reminds security directors that often the target of a physical break-in will be IT assets. SAIC has been busy since that break-in to reconstruct data and alert its stockholders -- many of whom hold government security clearances -- of the theft of their personal information. It is still not known whether the break-in was for the theft of data or a simple robbery of resalable hardware. From saic at vision.moundalexis.com Mon Feb 21 13:52:09 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Mon, 21 Feb 2005 08:52:09 -0500 (EST) Subject: [saic] S&P affirms A-ratings for SAIC Message-ID: <20050221085109.Y400-100000@vision.moundalexis.com> February 18, 2005 S&P affirms A-ratings for SAIC http://www.signonsandiego.com/news/business/20050218-9999-1b18calbrfs.html --- Standard & Poor's Ratings Services said it affirmed its A-corporate credit and senior unsecured ratings for SAIC, and removed the San Diego defense contractor from CreditWatch with negative implications. "The ratings reflect SAIC's strong positions in its established markets, ample liquidity, and consistent profitability and cash flow measures. These factors partly are offset by the challenges of expanding SAIC's commercial business (which now represents only about 8 percent of revenues), coupled with an active acquisition strategy," S&P credit analyst Philip Schrank said. But S&P maintained a negative outlook, based on SAIC's sale of Telcordia Technologies, which raised about $1.3 billion in cash but diminished SAIC's business diversity and reduced cash flow from a higher margin business. From saic at vision.moundalexis.com Mon Feb 21 13:55:13 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Mon, 21 Feb 2005 08:55:13 -0500 (EST) Subject: [saic] Grand Central Communications Signs Joint Marketing and Reseller Agreement With SAIC to Deliver Integration On Demand Solutions to Its Customers Message-ID: <20050221085307.P400-100000@vision.moundalexis.com> February 18, 2005 Grand Central Communications Signs Joint Marketing and Reseller Agreement With SAIC to Deliver Integration On Demand Solutions to Its Customers http://www.prnewswire.com/cgi-bin/stories.pl?ACCT=109&STORY=/www/story/02-18-2005/0003030296&EDATE= --- Accord to Increase Efficiency of Application Integration and Business Process Development for Enterprises and Government Organizations SAN FRANCISCO, Feb. 18 /PRNewswire/ -- Grand Central Communications announced today that it has signed a Joint Marketing and Reseller Agreement with Science Applications International Corporation (SAIC) to provide solutions for integrating applications and developing more efficient business processes. Under the terms of the Joint Marketing and Reseller agreement, Grand Central provides SAIC with an Integration On Demand platform to deliver application integration, and business process management solutions to its government and public sector customers. SAIC provides business process modeling, application integration, portal solution development and application migration services. Grand Central provides the platform for Integration on Demand, and the tools for managing the business processes, managing the Service Level Agreements and orchestrating the various business processes between disparate organizations and systems. "We are pleased to align with SAIC in providing low cost solutions to their customers," said Halsey Minor, Grand Central founder and CEO. "Grand Central's Network combined with SAIC's system integration expertise brings tremendous value to organizations who are looking for scalable, service-oriented infrastructure solutions for application integration and business process development." About SAIC: SAIC is the largest employee-owned research and engineering company in the United States, providing information technology, systems integration and eSolutions to commercial and government customers. SAIC engineers and scientists work to solve complex technical problems in national and homeland security, energy, the environment, space, telecommunications, health care and logistics. With annual revenues of nearly $7 billion, SAIC and its subsidiaries, including Telcordia Technologies, have more than 45,000 employees at offices in more than 150 cities worldwide. More information about SAIC can be found at http://www.saic.com. About Grand Central Communications: Grand Central Communications provides Integration On Demand(SM) solutions through its award-winning, subscription-based Business Services Network. Together with our community of on demand service provider and system integrators, we enable enterprises to easily integrate and share applications, data, and processes throughout the extended enterprise, without installing, maintaining, or supporting costly hardware or software. By offering integration as an on demand service, Grand Central and its system integrators dramatically increase the success and eliminate the risk of business integration, providing a better alternative to complicated, lengthy, and expensive traditional software deployments. The company is headquartered in San Francisco, California. Call 800-845-4313 or visit http://www.grandcentral.com for more information. From saic at vision.moundalexis.com Tue Feb 22 13:38:47 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Tue, 22 Feb 2005 08:38:47 -0500 (EST) Subject: [saic] Questra Corporation's Growth Signals Emergence of Intelligent Device Management (IDM) Market Message-ID: <20050222083819.H400-100000@vision.moundalexis.com> Tuesday February 22, 6:00 am ET Questra Corporation's Growth Signals Emergence of Intelligent Device Management (IDM) Market http://biz.yahoo.com/prnews/050222/sftu068_1.html --- Strong Momentum in Customer Acquisition and Application Implementations Firmly Establishes Questra Leadership REDWOOD CITY, Calif., Feb. 22 /PRNewswire/ -- Questra Corporation, a leader in intelligent device management (IDM), today reported that it continues to expand its global market leadership. Questra is the fastest growing intelligent device management company, enabling equipment manufacturers to integrate real-time product performance data from products installed in their customers' sites into their business processes. Questra's full-featured, enterprise software solution can be quickly implemented to automatically and proactively monitor and manage the performance of all kinds of remote intelligent devices in real-time -- outside corporate firewalls and over the Internet -- resulting in better information, increased productivity, lower service costs, and higher customer satisfaction. "Companies with strong remote service strategies to reach thousands of connected devices in real-time, realize the ultimate cost and process advantages in service," said Glen Allmendinger, president of Harbor Research, Business Intelligence and Strategy for Emerging Technology Opportunities. "The information advantage of using the real-time performance data is significant. The Questra solution empowers these companies to move to new service models, and greatly expands the nature of interactions possible between manufacturers and their customers." Questra has experienced remarkable growth during FY 2004. The number of new customers selecting Questra has doubled over the previous year with the addition of Ingersoll-Rand, Science Applications International Corporation (SAIC), Samsung, Waters Corporation, Agfa and ABDick (a Presstek company) among others. These new customers join other Questra customers such as GE Healthcare, Kodak, and Heidelberg, proving the largest companies in the world continue to select Questra for their device management initiatives. With a strong customer base already established in the US, Germany and Switzerland, Questra increased its global presence by signing major new customers in Korea, France, Belgium, and Japan. Questra also developed a strategic alliance with Sumisho Electronics Co., Ltd. (SSE), a leading IT solutions provider, to distribute Questra IDM software in Japan. "Questra has played an important role in the establishment of the IDM market," said Emil Wang, president and CEO of Questra Corporation. "We have enjoyed tremendous success in the last year-the numbers speak for themselves. And now we are pleased to continue working with our customers to extend our innovations to a larger audience of major manufacturers worldwide." In addition, Questra doubled the number of project implementations at customer sites. In support of this growth, Questra increased its employee base by over 20%, added seasoned executive management members and closed a $9 million round of venture capital funding. About Questra Corporation Questra is an enterprise software company leading the development and marketing of intelligent device management solutions. Equipment manufacturers use the Questra Smart Service Solution, which proactively monitors and manages remote intelligent devices, to provide superior yet cost-effective support to their customers. Agfa, General Electric, Heidelberg, Kodak, SAIC, and Samsung, among other Fortune 1000 companies, have chosen Questra software as part of their corporate strategies to advance from reactive to proactive equipment service and support. For more information, visit www.questra.com. NOTE: Questra and the Questra logo are trademarks of Questra Corporation in the United States and worldwide. Contact for Questra Laurie Gibson B3 Communications, Inc. 650-969-0764 lgibson at b3communications.com From saic at vision.moundalexis.com Wed Feb 23 14:10:51 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Wed, 23 Feb 2005 09:10:51 -0500 (EST) Subject: [saic] Secretive SAIC suffers break-in Message-ID: <20050223090950.W400-100000@vision.moundalexis.com> 23 February 2005 Secretive SAIC suffers break-in http://www.techworld.com/security/news/index.cfm?NewsID=3191 --- Private company and US government contractor has laptops stolen. By Cara Garretson, Network World Fusion US government contractor Science Applications International (SAIC) has reported a break-in at its headquarters during which laptops containing personal information about its stockholders were stolen. The break-in took place on 25 January at SAIC administrative building in San Deigo. The company.s outsourcing business was not affected. SAIC provides IT help and systems integration to commercial and government customers. The computers stolen contain personal information about current and former stockholders, including their names, Social Security numbers, addresses, telephone numbers and records of shares bought and sold. The company is owned by employees, which include former high-level government executives from agencies including the US Department of Defense and the Armed Forces. Officials say they have no conclusive information whether the attack was targeted and wouldn.t comment on whether the crime was an inside job. SAIC reported the incident to San Diego police, which is attempting to recover the stolen computers. Other items were stolen during the break-in, though the company has refused to say what. The company has notified current and former stockholders of the break-in. It has also established a toll-free number where a pre-recorded message offers stockholders information about identity theft, as well as a help desk that stockholders can call for further assistance. Under a recent California state law, companies who experience a breach in their computer systems that could result in identity theft must notify the potential victims. From saic at vision.moundalexis.com Sat Feb 26 14:41:24 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Sat, 26 Feb 2005 09:41:24 -0500 (EST) Subject: [saic] Lawmakers Target Consumer-Data Privacy Message-ID: <20050226094054.C400-100000@vision.moundalexis.com> February 25, 2005 Lawmakers Target Consumer-Data Privacy http://www.eweek.com/article2/0,1759,1770433,00.asp --- By Caron Carlson and Dennis Fisher In the wake of recent high-profile thefts of sensitive personal information from what were considered protected databases, legislators are preparing to turn up the heat on private enterprises that fail to safeguard customers' data. Lawmakers' renewed urgency is being fueled largely by the recent security blunder at data warehouse vendor ChoicePoint Inc. The incident, which illustrates the kind of damage many privacy-law advocates have long feared, is spurring legislators to take a new look at data privacy initiatives that died in the last session of Congress. ChoicePoint, based in Atlanta, disclosed earlier this month that scammers accessed information on more than 145,000 consumers, including Social Security numbers and credit histories. In a separate incident, thieves stole some of Science Applications International Corp.'s computers, which contained lists of SAIC shareholders, including their addresses, phone numbers, stock holdings and Social Security numbers. Following requests from minority leadership last week, Sen. Arlen Specter, R-Pa., chairman of the Senate Judiciary Committee, said he would hold a hearing on the ChoicePoint incident. Two of the Senate's leading champions of privacy rights, Patrick Leahy, D-Vt., and Dianne Feinstein, D-Calif., called for an investigation. Committee members want to examine how the incident happened and "how it can be prevented in the future," said Tracy Schmaler, a representative for Leahy. The senator is considering proposals that were not introduced in the last Congress, and there is more momentum for legislation this session, Schmaler said. Read more here about the U.S. Senate's passage of the Identity Theft Penalty Enhancement Act. Feinstein has reintroduced a bill that would require all federal agencies and any enterprise doing business in more than one state to disclose to customers any unauthorized acquisition of their personal information. Feinstein's measure, known as the Notification of Risk to Personal Data Act, first introduced in 2003, is similar in spirit to a California law that requires such notifications. Next Page: The experts weigh in. Some security experts applauded the legislators' efforts. "The disclosure laws are good things. It builds accountability on both sides," said Dave Jevens, chairman of the Anti-Phishing Working Group and vice president at Teros Inc., a security vendor in Santa Clara, Calif. "You can phish and send millions of e-mails and maybe get a thousand victims. But if you get a well-formed database with 250,000 names, you can make a quick couple of million dollars." Other experts, however, see flaws in Feinstein's bill and similar state measures proposed recently. "The definition of personal information is too narrow. If I steal your bank account number, home address, phone number and the amount of money you have in your account, but not your PIN, the bank doesn't have to disclose that," said Mark Rasch, chief security counsel at Solutionary Inc., in Omaha, Neb., and a former federal prosecutor. To read more about Microsoft and eBay's anti-phishing network, click here. Several lawmakers are drafting privacy legislation broader than the Feinstein approach. Sen. Charles Schumer, D-N.Y., said last week that he intends to introduce a comprehensive identity theft bill soon. Calling ID theft "America's leading consumer complaint," Schumer said there must be national limitations on the disclosure of data by private companies. Particularly incensed about the Westlaw online research service provided by a division of Thomson Corp., Schumer said subscribers can obtain the Social Security numbers of millions of Americans. "This makes identity theft as easy as operating a computer," he said. Check out eWEEK.com's Security Center for the latest security news, reviews and analysis. And for insights on security coverage around the Web, take a look at eWEEK.com Security Center Editor Larry Seltzer's Weblog. From saic at vision.moundalexis.com Sat Feb 26 14:44:36 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Sat, 26 Feb 2005 09:44:36 -0500 (EST) Subject: [saic] Air Force Keeps Hammering SAIC for Alleged Nondisclosures While Industry Concern Builds Message-ID: <20050226094416.J400-100000@vision.moundalexis.com> February 25, 2005 Air Force Keeps Hammering SAIC for Alleged Nondisclosures While Industry Concern Builds http://www.prnewswire.com/cgi-bin/stories.pl?ACCT=109&STORY=/www/story/02-25-2005/0003075721&EDATE= --- WASHINGTON, Feb. 25 /PRNewswire/ -- Following up an unusual "alert" in December about alleged fraud carried out by Science Applications International Corporation, the Air Force has issued a "Defective Pricing Notice" concerning the company. Industry executives who have seen this notice are voicing concern about its potentially broader impact on the government contracting industry. The December alert arose after the Department of Justice took over the lead of a whistleblower's False Claims Act lawsuit against the company. The civil suit alleges that SAIC padded fixed-price proposals with extra labor to compensate for such contingencies as government delays, and as a result reaped much larger profits than originally estimated. The notice, dated February 11, provides model language to contracting officials for requesting comprehensive proposal back-up details, including internal company reports. SAIC denies the government allegations that it has violated the Truth in Negotiations Act (TINA). The company has made exhaustive arguments in the suit that it was not required to make disclosures that the Air Force now wants. Earlier this month, however, the presiding Federal district court judge in San Antonio denied a SAIC motion to dismiss the lawsuit. Trial is scheduled for January 2006. Industry executives, who commented only on the condition of anonymity, expressed growing anxieties about the Air Force approach to the SAIC matter. One said, "The alert and notice are of greater concern to us than the whistleblower suit. SAIC can take care of itself. But the Air Force is using intimidation tactics and is apparently trying to set a precedent for disclosure it can demand from all suppliers, regardless of the type of contract." Through a spokesman for the general counsel's office, the Air Force claimed that the notice reflects "longstanding, well established policy" regarding mandatory disclosure, but made no further comment due to ongoing litigation. A second industry executive noted for the Insider that, "the government has hardly been consistent in its disclosure demands over time and cross agencies. This demonstrates that the TINA is subject to varying interpretations." SAIC representatives had met and corresponded with Air Force legal officials about the December alert but were surprised by the notice. A company spokesman said that in response to the December alert, the firm "agreed, while preserving all its rights with respect to the TINA litigation to provide [proposal risk assessments and detail on labor for contingencies] in all TINA-covered situations, whether or not they are requested by the government." This measure more than satisfies Air Force concerns expressed in December, he said. The company also reported that its business had so far not suffered due to the Air Force tactics, but suggested that broader industry actions are needed to address Air Force concerns. In that regard, Alan Chvotkin, senior vice president and counsel to the Professional Services Council, a leading trade group, said that, "The Air Force demands on SAIC reflect a new and substantial expansion of the state of the law regarding mandatory disclosures" and warrant broad consultation with industry before implementation. He added, "If the Air Force intends to apply its mandatory disclosure demands beyond SAIC to the industry as a whole, this should be a matter of formal rulemaking, including notices and public comment." Source: Government Services Insider, a monthly publication for executives and managers who lead companies providing professional and technology services to the federal government. SOURCE Government Services Insider Web Site: http://www.gsinsider.com From saic at vision.moundalexis.com Sun Feb 27 13:37:54 2005 From: saic at vision.moundalexis.com (saic at vision.moundalexis.com) Date: Sun, 27 Feb 2005 08:37:54 -0500 (EST) Subject: [saic] Air Force Keeps Hammering SAIC for Alleged Nondisclosures While Industry Concern Builds Message-ID: <20050227083647.L400-100000@vision.moundalexis.com> Friday February 25, 11:00 pm ET Air Force Keeps Hammering SAIC for Alleged Nondisclosures While Industry Concern Builds http://biz.yahoo.com/prnews/050225/nyf108_1.html --- WASHINGTON, Feb. 25 /PRNewswire/ -- Following up an unusual "alert" in December about alleged fraud carried out by Science Applications International Corporation, the Air Force has issued a "Defective Pricing Notice" concerning the company. Industry executives who have seen this notice are voicing concern about its potentially broader impact on the government contracting industry. The December alert arose after the Department of Justice took over the lead of a whistleblower's False Claims Act lawsuit against the company. The civil suit alleges that SAIC padded fixed-price proposals with extra labor to compensate for such contingencies as government delays, and as a result reaped much larger profits than originally estimated. The notice, dated February 11, provides model language to contracting officials for requesting comprehensive proposal back-up details, including internal company reports. SAIC denies the government allegations that it has violated the Truth in Negotiations Act (TINA). The company has made exhaustive arguments in the suit that it was not required to make disclosures that the Air Force now wants. Earlier this month, however, the presiding Federal district court judge in San Antonio denied a SAIC motion to dismiss the lawsuit. Trial is scheduled for January 2006. Industry executives, who commented only on the condition of anonymity, expressed growing anxieties about the Air Force approach to the SAIC matter. One said, "The alert and notice are of greater concern to us than the whistleblower suit. SAIC can take care of itself. But the Air Force is using intimidation tactics and is apparently trying to set a precedent for disclosure it can demand from all suppliers, regardless of the type of contract." Through a spokesman for the general counsel's office, the Air Force claimed that the notice reflects "longstanding, well established policy" regarding mandatory disclosure, but made no further comment due to ongoing litigation. A second industry executive noted for the Insider that, "the government has hardly been consistent in its disclosure demands over time and across agencies. This demonstrates that the TINA is subject to varying interpretations." SAIC representatives had met and corresponded with Air Force legal officials about the December alert but were surprised by the notice. A company spokesman said that in response to the December alert, the firm "agreed, while preserving all its rights with respect to the TINA litigation to provide [proposal risk assessments and detail on labor for contingencies] in all TINA-covered situations, whether or not they are requested by the government." This measure more than satisfies Air Force concerns expressed in December, he said. The company also reported that its business had so far not suffered due to the Air Force tactics, but suggested that broader industry actions are needed to address Air Force concerns. In that regard, Alan Chvotkin, senior vice president and counsel to the Professional Services Council, a leading trade group, said that, "The Air Force demands on SAIC reflect a new and substantial expansion of the state of the law regarding mandatory disclosures" and warrant broad consultation with industry before implementation. He added, "If the Air Force intends to apply its mandatory disclosure demands beyond SAIC to the industry as a whole, this should be a matter of formal rulemaking, including notices and public comment." Source: Government Services Insider, a monthly publication for executives and managers who lead companies providing professional and technology services to the federal government. Source: Government Services Insider