OIG report: irregularities in the awarding of a computer contract


A report from the Office of Inspector General (OIG) of the City of Montreal highlighted “major irregularities” in the awarding of a contract to the firm Onix Networking Canada for the acquisition of a “cloud computing solution “.

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The report, released on Monday, relates to a contract awarded for the period from 2018 to 2022 and with three renewal options, each for two years.

“The shortcomings observed during the OIG’s investigation are such that they could have been the subject of a termination of contract”, it is noted there.

In the public interest and to avoid harming operations, the Inspector General recommends instead that the City set up an action plan to end the contract “as quickly as possible”.

At the origin of the investigation, a whistleblower indicated that employees of the City’s Information Technology Department favored a company in the bidding process.

Three companies had submitted a bid, but only that of Onix, an American firm which also has offices in Montreal, Ottawa and Toronto, was deemed compliant. The contract awarded was worth $15.9 million, and could have been as high as $35 million with renewal options.

“The BIG investigation did not lead to the conclusion of favouritism. However, it made it possible to uncover major irregularities in the call for tenders process, which should have led to the rejection of the successful bidder’s bid,” it is mentioned in the report.

Irregularities

Among these findings, Onix’s bid contains a “major irregularity” regarding the amount requested for the six option years, which could not be increased more than inflation. The company rather indicates that the price of the licenses will not be maintained after the four years of the contract and that it will depend on Google.

“The price of Onix’s bid is not determined or determinable,” the report denounces in this regard.

The company also failed to meet one of the requirements of the quote, which called for the IT solution to deny access to any user after a certain number of unsuccessful access attempts.

Instead, the G-Suite solution offered alternative mechanisms based on artificial intelligence to determine potential threats.

“If the City had wanted to allow the use of such alternative mechanisms or new technologies, it should have opted explicitly for such wording,” the report states.

The OIG sees this as a “misunderstanding” of the members of the technical committee of their role, rather than bad faith.

Finally, the OIG criticizes the technical committee for not having had “the same level of rigor and severity” with regard to all the tenderers, concerning the requirement that the IT solution be compatible with different browsers.

“The investigation reveals that the evaluation was rigorous for the solution of another bidder, but that the same rigor was not applied to the solution proposed by Onix”, it is indicated.

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