Billions of dollars in fast-track federal construction stimulus spending is expected to boost cases of fraud and ratchet up government scrutiny, say industry executives. The American Recovery and Reinvestment Act’s $787-billion spending total will likely lure many out-of-work firms into the federal contracting arena, boosting competition and fraud potential. “There is a lot of public pressure to step up enforcement of taxpayer money,” said Mark A. Aiello, a partner with Foley Lardner LLP, Detroit, at the Construction Financial Management Association’s annual conference, held last month in Las Vegas. Subcontractors and third-tier suppliers also are subject to federal sanctions for front-loaded
The market is generally healthy and steadily growing, and margins are up for large specialty contractors. Further, advances in design tools and owner demand for collaboration are giving subcontractors a seat at the table early on in projects.