US government official quits over Oracle contract scandal

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The scandal in California over a $95 million contract with Oracle has claimed the scalp of a top government official.

Barry Keene, director of the state's Department of General Services – which is responsible for drawing up and signing contracts - has jumped ship after a state audit criticised a decision to award the contract to Oracle without competitive bids.

Keene, a former state senator, said he had approved the deal at the same time as going through marital problems. "The Oracle controversy was due mainly to an error of judgement in which I relied upon data not properly validated and facts incompletely disclosed," he said.

The Oracle contract was supposed to save taxpayer dollars by signing up for a six year deal, but a state audit earlier this month demanded to know why it was signed when a survey indicated that most workers did not want to use the software in the first place. It also revealed that an Oracle consulancy partner Logicon stood to make $28 million from the deal.

State Auditor Elaine Howle said Logicon used "shaky" assumptions in calculating the state savings and taxpayers could end up doling out $41 million more than if they had bought the software separately.

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