Advice on the ‘bailout bonanza’ from a controversial pitchman

Introduction

Meet Fred Steinberg. He “will personally outline what you must know for your company to prosper under the ‘new capitalism’ emerging from Washington,” according to an e-mail from his company, B2G Institute, Inc, a subsidiary of the Telligenix Corporation. And he’ll do that over the next two days at his institute’s national conference on winning government contracts and stimulus funds at the Arlington, Virginia, Sheraton. But before signing up for Steinberg’s tips on getting a piece of the “bailout bonanza,” you might want to check out his resume.

Consider this: The Better Business Bureau of Central Florida gives the B2G Institute an ‘F.’ The site says that B2G, which stands for “Business To Government,” has a “number of serious complaints filed against” it. The Bureau says that many of the complaints, which revolve primarily around “delays in receiving refunds,” have been resolved.

In the 1990s, Steinberg, 59, was charged with grand theft three times and with a scheme to defraud, according to Lee County, Florida, court records — but he was never convicted. In one case, Steinberg was charged with both grand theft and the scheme to defraud, but the state declined to prosecute, according to Lee County records. The other two grand theft cases were dismissed. Steinberg was charged with racketeering, but was acquitted by a jury in 2004. Steinberg also has faced lawsuits from investors who alleged he defrauded them, several of which ended because Steinberg declared bankruptcy. San Diego 6 News investigative reporter John Mattes reported on these cases in 2007.

Steinberg, who is based in Boca Raton, Florida, says he is selling the secrets to winning government contracts, including stimulus funds, in part through access to government contracting personnel. Indeed, several government officials are listed on his website as panelists at this week’s 2009 B2G National Conference.

The government employees listed as presenters are: the General Service Administration’s Steve Kempf (who replaced GSA’s Tyree Varnado), the Small Business Administration’s Malda Brown, the Education Department’s Kristi Wilson-Hill, and David Sutton, director of the Office of Small and Disadvantaged Business Utilization Directors Interagency Council. With those government employees, says an e-mail from B2G, “you have a rare opportunity to learn firsthand — direct from sources within the government — what contracts are coming up.”

“It’s handshaking that can lead to moneymaking,” Steinberg wrote in an e-mail.

Last Friday, PaperTrail asked the GSA about the involvement of Kempf and Varnado, and was told that both men had now backed out of the conference. “Both Mr. Kempf and Mr. Varnado have conflicts in their schedules for this event. They will not be attending the B2G conference,” said Steve Hoffman, a GSA spokesman.

Another government official told PaperTrail that she was backing out too. “I have informed the B2G conference planners that I will not be participating in their conference in any way (attendee or presenter),” said Kristi Wilson-Hill, director of the Education Department’s office of small business programs. “I am unable to comment any further regarding this matter.”

As of Monday evening, Kempf and Wilson-Hill were still listed on the B2G website as the “keynote speaker.” PaperTrail did not receive a comment in response to calls and e-mail to the other officials.

Steinberg appears to be espousing networking and access to government insiders as the key to winning contracts, said Richard C. Loeb, an adjunct professor of government contracting at the University of Baltimore law school. “It is disturbing to think that large government contracts may be awarded primarily through networking or contacts, in other words ‘a who you know rather than what you know’ situation.”

PaperTrail reporters attended a December B2G conference at an Arlington, Virginia, Hilton with about 30 other attendees. At that conference, Steinberg proudly espoused the work of Marius Boyd, a B2G marketing representative and owner of TV Guy Orlando LLC, as an example of how easy contracting can be. Accompanied by laughs from the crowd and the urging of Steinberg, Boyd described how he bought coffins from “cheapcaskets.com” and resold them at a higher price to Fort Stewart, an Army base in Georgia. According to Steinberg, Boyd “is now the middle man between cheapcaskets.com and Fort Stewart.” A search of a government contracting database turned up contracts between Boyd’s TV Guy Orlando and Fort Bragg, an Army base in North Carolina beginning in 2008 and continuing into 2009.

Steinberg has not responded to requests for comment.