IBM Under Temporary Ban from New Federal Contracts

Well, I certainly was surprised by this: prosecutors are examining the relationships between IBM employees and the Environmental Protection Agency. When there is a suspected procurement problem, all federal agencies tend to follow the lead of the one involved in an action. That could quickly become serious for Big Blue:

Armonk, N.Y.-based IBM does business with all corners of the government, though the Defense and Homeland Security departments are much bigger customers than the EPA, according to federal spending databases. Last year IBM's contracts amounted to at least $1.3 billion, roughly 1 percent of its 2007 revenue.

That's not a huge amount, but I wonder if it could scare other business off. No publicly-held corporation will be interested in appearing to be involved in questionable business, even if by proxy. Here's a copy of the emailed statement from the EPA.