A decade-long bribery scheme inside USAID has triggered a sweeping audit at the SBA, as leadership scrambles to contain the fallout and restore public trust in federal contracting.
Key Facts:
- USAID official Roderick Watson pleaded guilty to a bribery scheme dating back to 2013 involving cash, perks, and government contracts.
- Watson received over $1 million in bribes from contractors, including NBA tickets, mortgage down payments, and shell company payouts.
- One contractor involved—Vistant—was awarded an $800M contract later canceled for lack of integrity, then reinstated after a lawsuit.
- SBA Administrator Kelly Loeffler ordered a full audit of SBA contracting officers going back 15 years.
- The SBA will prioritize high-dollar and limited competition contracts and refer findings to the DOJ and OIG.
The Rest of the Story:
The scandal erupted after Watson admitted to accepting a wide range of bribes from two contractors—Walter Barnes and Darryl Britt—who disguised their payments through subcontractor Paul Young.
These bribes funded personal luxuries and job placements for Watson’s family.
Despite USAID’s knowledge of Vistant’s misconduct, the firm received a staggering $800 million contract in 2023 aimed at curbing Central American migration.
Days later, USAID reversed course, calling out the company’s “lack of business honesty,” only to face a successful lawsuit that reinstated the deal and handed Vistant an additional $10,000 settlement.
Now the SBA, under Administrator Loeffler, is distancing itself from the fiasco.
She directed her associate to comb through all SBA contracting activity since 2010 and forward any misconduct to prosecutors. “We owe it to America’s small businesses to get this right,” she wrote.
DOJ uncovered a MASSIVE $550M fraud and bribery scheme at USAID – involving contracts to help the government identify “root causes of irregular migration from Central America.”
Today, I ordered a full audit of SBA’s 8(a) contracting program – to make sure it never happens again. https://t.co/sXgaXGfiP3
— Kelly Loeffler (@SBA_Kelly) June 27, 2025
Commentary:
This isn’t just a story about one crooked official—it’s about a culture of rot that metastasized in plain sight.
You don’t pull off a $1 million bribery scheme over ten years unless your agency has turned a blind eye or, worse, come to expect this behavior as standard operating procedure.
The fact that USAID tried to quietly walk back the Vistant contract, only to fold in court and reward the firm with a fresh payout, tells you all you need to know.
Accountability wasn’t just absent—it was actively avoided.
And where was the Biden administration while all this was happening? Rubber-stamping a mega-contract with a tainted vendor while lecturing taxpayers about “root causes” of migration.
Evidently, those causes include corruption and sweetheart deals.
Loeffler’s audit is a good first step, but it must be more than a political showpiece.
Real reform means more than a few firings—it means frog-marching bad actors into court and rewriting the rules that let them operate in the shadows.
Government contracts aren’t supposed to be ATMs for the connected.
They’re supposed to serve the public and open doors for honest small businesses, not pad the pockets of insiders with courtside tickets and country club weddings.
The contractors weren’t amateurs either. They set up fake payrolls, funneled payments through ghost companies, and gamed every crack in the system. This was organized fraud.
And it wasn’t isolated. If you think this is the only scheme like this, think again.
Federal procurement is riddled with loopholes, and this case should trigger a full scrub across agencies.
The Bottom Line:
The Watson bribery case isn’t just a black eye for USAID—it’s a gut punch to taxpayers.
Unless the SBA follows through with real audits and real consequences, this will go down as yet another Washington scandal swept under the rug.
Public trust is eroded when fraud pays and integrity gets sidelined. It’s time the system proved otherwise.
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