Outsourcing firms submitted contracting records with detailed description of company that doesn’t exist

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IT staffing firms at the centre of misconduct allegations submitted contracting reports to the federal government that included a detailed description of a company that doesn’t exist, documents show.

The documents are an additional example of what Amir Morv and Ritika Dutt, the co-founders of software company Botler, allege is misconduct on the part of IT outsourcing companies that receive millions of dollars each year in federal contracts.

Mr. Morv received the documents in response to a Privacy Act request.

They show two companies that regularly work together – Dalian and Coradix – submitted Mr. Morv’s résumé and a contracting points form to the Canada Border Services Agency that listed Mr. Morv as having nearly 13 years of experience working for an independent business called Moravej Inc.

Mr. Morv is in the process of legally changing his last name from Moravej to Morv, but he said he has never owned or worked for a company called Moravej Inc.

“I’ve never seen this name before,” he said.

Years of experience is used in federal contracting to determine whether a contractor qualifies for the position. It is also used to calculate per diem rates. The federal government relies heavily on private IT staffing firms that bill federal departments and then pay subcontractors to do the requested work, withholding varying percentages as a commission.

Mr. Morv and Ms. Dutt submitted detailed allegations of misconduct related to Dalian, Coradix and another IT staffing company called GCStrategies in September, 2021, and again in November, 2022. They also raised concerns about cozy ties between contractors and public servants. In response to the 2022 report, the CBSA referred the allegations to the RCMP and the national police force has confirmed it has launched an investigation.

The Botler co-founders have been invited to appear as witnesses Thursday before the government operations committee to discuss their allegations. The current and former CBSA presidents are scheduled to appear Tuesday. The three staffing companies have not responded to requests for comment from The Globe and Mail. They have been invited to speak to the committee at a later date.

Botler performed contract work for the CBSA in 2020 and 2021 related to a pilot project for supporting victims of sexual harassment.

They allege that the CBSA urged them to work with GCStrategies, but say they were later shocked to discover that the contract for their work was run through Dalian without their knowledge. Each layer of subcontracting was proposing to collect substantial commissions and it was unclear how federal funds were being distributed, they said.

Opposition to press for public hearings on federal outsourcing after CBSA allegations

The newly obtained documents describing Mr. Morv’s work experience include a letter submitted to the CBSA on joint Dalian and Coradix letterhead that is dated Dec. 1, 2020. Mr. Morv and Ms. Dutt said at that point they were not aware of Dalian’s involvement.

They say they first learned of Dalian’s inclusion from GCStrategies managing partner Kristian Firth in a Jan. 26, 2021, e-mail in which he disclosed that the contract for Botler to provide its services was not a direct contract between Botler and the border services agency. Instead, the agency relied on a contract with Dalian and Coradix. Then, in a separate subcontracting document between Dalian and GCStrategies, GCStrategies is listed as a subcontractor to Dalian. Ms. Dutt and Mr. Morv were listed as consultants.

“Unannounced to you as Corradix/Dalian were brought in as a pass through and they demanded 15 % for doing so, CBSA were pissed at the overall pricing and threatened to pull the contract,” Mr. Firth wrote in the Jan. 26 e-mail.

Botler’s Nov. 2022 report – titled “preliminary misconduct report to leadership” – informed the agency’s top officials that documents they obtained through an access to information request showed CBSA officials signed off on contracting documents that included highly inflated experience related to Ms. Dutt.

For instance, Ms. Dutt said a two-month summer internship at Deloitte on her résumé was inflated in an invoicing points form submitted by Coradix to say she had 51 months of experience working for the accounting firm.

The new records obtained by Botler show a similar pattern with respect to Mr. Morv’s files.

Mr. Morv said the records appear to show that someone took examples of genuine work from his résumé and exaggerated the years of experience via a company that does not exist.

The flow of tax dollars to the three staffing companies combined has increased steadily each year, growing from $32.6-million in 2016-17 to $80.3-million in 2021-22, the most recent year for which figures are available.

Since 2017, GCStrategies has received $46-million in federal funding. And over the past 10 years, Coradix and Dalian – which share the same office and often operate as a joint venture – have received a combined $362-million.

Members of Parliament voted unanimously last week to expand their study of ArriveCan contracting to include Botler’s allegations after The Globe reported on Botler’s concerns and the police investigation.

The committee has been studying how the cost of the ArriveCan app grew to in excess of $54-million.

The Botler team did not work on ArriveCan, but the three IT staffing firms they were involved with were also among the top recipients of outsourcing work related to ArriveCan. Both projects were overseen by some of the same senior public servants and both use layers of subcontracting that keep key details – such as the work involved and who received payments – from being disclosed to the public.

The Botler project was funded from a larger $21.2-million contract for general services that was also used by the CBSA to fund outsourcing work related to the ArriveCan app.