In Viderity Inc. – Costs, GAO found an agency’s investigation into a potential conflict of interest to be unreasonable where the agency “failed to inquire with” the awardee-intervenor “as to whether the firm had a business relationship with” an agency evaluator. The decision was issued on September 1, 2026.
The protester alleged that one of the agency evaluators, referred to by GAO as Ms. X, “previously served as a consultant for” the awardee and allegedly “advised the firm regarding the requirement and the potential competition.” The contracting officer investigated the potential conflict of interest, including speaking to Ms. X, but did not ask the awardee whether it had a business relationship with her. The agency produced a declaration from Ms. X stating that she was never employed by the awardee and never served as a consultant to them, and the agency thus concluded that no conflict existed.
After the agency report was filed, however, the awardee-intervenor informed the agency that, contrary to the agency’s findings, they and Ms. X “had executed a purchase order for consulting services.” The agency then opted to take voluntary corrective action, which led to the protester’s cost claim addressed in the decision.
GAO found that the agency’s failure to ask the awardee about its relationship with Ms. X rendered its investigation unreasonable. GAO explained:
Notably absent from the agency’s initial investigation was an inquiry with [the awardee] as to whether it had any records of a business relationship with Ms. X. Indeed, had [the agency] asked [the awardee] — the firm with whom Ms. X was alleged to have a business relationship and a party to the protest proceedings before our Office — whether it had employed or contracted with Ms. X in some capacity, it would have learned of the executed purchase order for consulting services. In turn, the agency would have likely continued its investigation into whether that relationship tainted the agency’s conduct of the procurement, rather than summarily concluding that no potential conflict existed. Generally, our Office reviews a contracting officer’s consideration of a potential conflict of interest for reasonableness and whether an agency has given meaningful consideration as to whether a conflict of interest exists. . . . Here, we conclude the agency’s investigation into a potential conflict of interest was unreasonable where [the agency] failed to inquire with [the awardee] as to whether the firm had a business relationship with Ms. X.
In short, Viderity is much more than a cost decision. It provides an instructive look into how GAO considers the adequacy of an agency’s conflict of interest investigation.