GAO dismisses Equifax protest for controversial IRS contract

The Government Accountability Office dismissed a bid protest Monday from Equifax for e-verification services with the IRS, allowing the agency to move on to work with a competing credit reporting agency.

The protest has been at the center of a controversy involving the IRS after lawmakers became aware that the agency issued a $7.25 million bridge contract with Equifax for its services just weeks after the contractor suffered a breach that compromised the information of more than 145 million Americans. But IRS officials testified earlier this month that the contract wasn’t completely by choice — the agency initially awarded the contract to Experian on July 3, but the protest prevented the final processing of that award until the Government Accountability Office resolved the issue.

The IRS last week suspended the contract with Equifax after continuing pressure from lawmakers and reports that an Equifax webpage had been disseminating malware to users. 

Now that GAO has dismissed the protest, the IRS is clear to begin working with Experian under the $795,000 contract for a year of taxpayer identification and verification services. The IRS gave no indication why the Experian contract was so much smaller.

“In its protest, Equifax argued that the approach set out in the Experian quotation (or offer) should have been found unacceptable, because, in Equifax’s view, Experian was not able to meet all of the technical requirements of the solicitation,” Ralph White, managing Aassociate general counsel for procurement law at GAO, said in a statement. “GAO denied Equifax’s protest, concluding that the IRS reasonably found that the Experian offer would meet the agency’s needs. In essence, GAO’s decision concludes that Equifax’s contentions were based on an unreasonable interpretation of the solicitation.”