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Defense inspector general to investigate Pentagon’s $10 billion cloud contract

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Published: August 13, 2019, 9:33pm

WASHINGTON — The Defense Department’s inspector general has assembled a team of auditors to evaluate the Pentagon’s handling of its largest cloud computing project, a massive contract that could be worth up to $10 billion over 10 years.

The IG’s review presents yet another hurdle for the Joint Enterprise Defense Infrastructure contract, known as JEDI, which has been mired in controversy and costly litigation for over a year. The matter was referred to the inspector general by members of Congress and through the agency’s complaints hotline, said Dwrena Allen, a spokeswoman for the inspector general.

“We are reviewing the DoD’s handing of the JEDI cloud acquisition, including the development of requirements and the request for proposal process,” Allen said. “In addition, we are investigating whether current or former DoD officials committed misconduct relating to the JEDI acquisition, such as whether any had any conflicts of interest related to their involvement in the acquisition process.”

In the statement, the IG would not commit to eventually publicizing its findings. The spokeswoman said the work of evaluating the contract had already begun, and would be completed “as expeditiously as possible.”

Dana Deasy, the Defense Department chief information officer in charge of the procurement, told reporters last week that his office would consult with the inspector general before awarding the massive contract. He did not say whether the award would be delayed until the inspector general completes its review.

Political firestorm

The announcement comes as a slow-boil of controversy surrounding the procurement has suddenly bubbled up into a political firestorm.

President Trump recently instructed newly-installed Defense Secretary Mark T. Esper to reexamine the contract over concerns that it will go to Amazon, a move that some observers characterized as an inappropriate incursion into the Pentagon’s business. (Amazon founder Jeff Bezos also owns The Washington Post)

Sen. Marco Rubio, R-Fla., whose political action committee has received donations from Oracle co-founder Larry Ellison, has asked that the contract be delayed and lobbied the president directly on the matter, a member of his staff said. Oracle has sued to block the contract. And Democratic Sens. Mark Warner of Virginia and Jack Reed of Rhode Island raised concerns that Trump may have acted inappropriately by intervening in the procurement.

The JEDI contract is meant to speed up the military’s use of so-called cloud computing systems, which use networks of remote servers to improve computing processes and ease the transmission of data. Defense Department officials say they need to adopt such technology to compete with Russia and China for military dominance. They want to turn to a single commercially-oriented tech company to operate that system, and have said only Amazon and Microsoft meet the minimum specifications.

The JEDI contract has been dogged by allegations that it is biased in favor of Amazon Web Services since it was unveiled last year. Oracle and IBM have sued to block the award, arguing that turning to a single company for such an important responsibility is unwise. They say the entire process is rigged in favor of Amazon Web Services.

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