What Role Did KPMG’s Procurement Practice Leader Play in Securing a Lucrative Contract for the iValua-KPMG Partnership?
Since Checks and Balances Project began an examination into the lucrative industry of selling e-procurement software to local and state government agencies, we’ve grown particularly interested in the way in which the software has been purchased by New York City agencies.
NYC’s government has 40 different agencies and departments that together buy an estimated $15 billion worth of products and services each year. E-Procurement software is supposed to allow them to buy goods and services with greater efficiency.
In December 2016, management consulting giant KPMG and the French e-procurement firm Ivalua announced that the two firms were jointly awarded a contract by NYC to implement Ivalua’s software for these 40 agencies. The deal was subject to oversight by the Mayor’s Office of Contract Services, under the leadership of Mayor Bill de Blasio.
When the two companies announced the selection by NYC in a news release, Samir Khushalani, KPMG’s practice leader for Procurement and Operations in the Americas, was quoted as saying:
“State and local governments are placing an overwhelming emphasis on transparency in their procurement process, especially as they seek to maximize the reach of the taxpayer dollars and operate in an efficient manner…we’re proud to serve the City with a combination of KPMG’s recognized thought leadership and advisory capabilities and Ivalua’s user-friendly, configurable solution.”
Since then, our search has found no reporting on how the software has performed for these NYC agencies or the savings for taxpayers that Mr. Khushalani references in his statement. However, we do know that from 2014 to 2015, KPMG LLP was registered as a lobbyist in New York City. All of this lobbying was related to seeking new procurement business.
Some of the questions we will be pursuing with Mayor de Blasio’s office and NYC agency officials are:
- Did Ivalua win the contract on the merits? Or was it KPMG’s persistent lobbying on procurement that stretched back to at least 2014?
- What were the nature of the communications between these lobbyists and the public officials they were trying to woo?
- What specific role did Mr. Khushalani play in securing this lucrative contract for KPMG/Ivalua and what type of communications did he have with NYC public officials and procurement officers?
- How has the Ivalua software performed, relative to promised benefit?
- What have been the savings to New York City taxpayers so far?
- How was the purchase decision made, especially in light of the legal controversy surrounding KPMG and the fired former head of MTA procurement?
- Several NYC agencies have promised a reply to our records requests this month.
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Scott Peterson is executive director of Checks and Balances Project, an investigative watchdog that seeks to hold government officials, lobbyists and corporate management accountable to the public. Funding for C&BP is provided by Renew American Prosperity and individual donors.
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