Redacted_J&A_CALLYO_Systems.pdf

Program Item: Callyo Estimated Dollar Value: $121,103.66 Control No: CAO-18-0514

Version – February 2017

Memorandum for Record – Limiting Competition at or below the Simplified Acquisition

Threshold

1. Contracting Activity: U.S. Army Contracting Command – New Jersey

2. Description of Action:

New Requirement

Solicitation Number: W15QKN-18-Q-0082

This will be procured on the open market.

Pricing/Contract Type: Firm Fixed Price Contract

Funds: Operations & Maintenance, Army (OMA), Fiscal Year 2018

Name of Proposed Contractor(s) and Address:

Callyo 2009 Corporation 402 North Division Street Carson City, NV 89703

Brand Name Buy: Yes

3. Description of Services or Supplies:

During the base year the contractor will provide one (1) Callyo Basic System (overall software system) for one year or 12 months; 150 Callyo lines for a period of 12 months (to be utilized by the entire command); 100,000 Callyo Credits (Pre-Paid with Rollover for the entire command); 24x7x365 Tactical Support; international number support; and Eight (8) (per Battalion) annual licenses (for the stand alone software which manages the call history and recordings).

For each option year the contractor will provide (1) Callyo Basic System (overall software system) for one year or 12 month period; 150 Callyo lines for a period of 12 months (to be utilized by the entire command); 100,000 Callyo Credits (Pre-Paid with Rollover for the entire command); 24x7x365 Tactical Support; international number support; and Eight (8)(per Battalion) and the Major Procurement Fraud Unit (MPFU) annual licenses (for the stand alone software which manages the call history and recordings) per user for a period of 12 months per option year. In addition to audio capability the contractor will provide a video capability in addition to the audio capability.

Base Period: Sep 2018 to Sep 2019 Value: $16,600.00

Control No: CAO-18-0514

Version – February 2017

Option Period 1: Sep 2019 to Sep 2020 Value: $33,736.60 Option Period 2: Sep 2020 to Sep 2021 Value: $34,990.03 Option Period 3: Sep 2021 to Sep 2022 Value: $35,777.03 FAR Clause 52.217-8 Total: $121,103.66

4. Authority:

FAR 13.106-1(b)(1): For purchases not exceeding the simplified acquisition threshold (SAT), only one source reasonably available, urgency, exclusive licensing agreements, brand name, or industrial mobilization.

Or

FAR 8.405-6(a)(1)(i)(B) and 8.405-6(b)(1)Brand Name FAR 8.405-6(a)(1)(i)(A) Urgency FAR 8.405-6(a)(1)(i)(B) Only One Source is Capable FAR 8.405-6(a)(1)(i)(C) Logical Follow-on

Or

FAR 16.505(b)(2)(i)(B) Only One Awardee is Capable FAR 16.505(a)(4) Brand Name FAR 16.505(b)(2)(i)(A) Urgency FAR 16.505(b)(2)(i)(C) Logical Follow-on FAR 16.505(b)(2)(i)(D) Minimum Guarantee

5. Reasons for Authority Cited:

a. The Callyo system is the only tool for the instant provisioning of secure recorded lines for law enforcement investigations. The Callyo 2009 Corporation is the sole source vendor, world-wide for the Callyo system and related services and accessories. There are multiple patents filed for Virtual Investigation Phones, and this specialized technology is not available from any other source. The patents cover the covert lines, along with the software to manage these lines so that they can be tracked separately by law enforcement, and recorded if authorizations permit. At a minimum there is an electronic record as to every time the line is used, and whether it is a call out on the number or a call received that fact is recorded, and the amount of time the line was open is also recorded in an electronic record that is useful during later court room testimony.

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Version – February 2017

b. Since 2014 USACIDC has utilized the “Callyo System” particularly for drug operations, however in 2017 an additional 30 lines were obtained for the Major Procurement Fraud Unit.

Traditional technical listening devices have limitations in distance and quality, for instance when there is a building in between the individual listening and the covert agent wearing the wire the signal transmission can be blocked. Further often there are distance requirements that the surveillance team must stay within in order to keep a signal for recording. The Callyo system operations with digital cellular technology for covert phone lines that can be used with any smart phone and provides the ability to either listen or record the information being discussed during covert operations. Further the system provides a covert telephone number to the agent so that when the perpetrator calls in on that number the covert agent knows who it is as they will be the only individual given that number. In 2014 training was conducted across the command, at each of the Battalions and currently all covert agents are not only technically proficient at using Callyo, but are using Callyo as the primary system for recording covert operations.

c. Currently there are covert operations being conducted across Army installations being worked primarily in the area of narcotics enforcement. These operations require legal authorization which cites the type of equipment being utilized. If the equipment is changed then the authorization must be resubmitted for approval. Further, all Agents are currently trained and comfortable with the process of using Callyo not only for recording conversations but for officer safety during operations. The results of these recordings are excellent and provide a clear audio recording for court room purposes. To change systems across the board would be very time intensive in the area of training and utilization. This system is being used primarily be all Department of Justice and Department of Defense investigative agencies due to the quality of the recordings and the ability to listen in for officer safety reasons. To change systems we would risk losing credible evidence from direct discussions with the perpetrators, which would potentially cause us to lose felony cases at criminal trial. Further the cost of completely replacing the Callyo system across the command would be $25,000.00 in training costs and over $100,000.00 in travel costs to each of the eight battalions and Afghanistan.

These travel costs are based on past performance with hiring trainers for other DoD projects, and bringing soldiers and civilians in for the training that are based across the United States and Overseas. At this time active personnel authorities in Korea, Germany, and Afghanistan use the Callyo system and allow its use on a case by case basis which is not capable with traditional technical listening equipment. To procure both traditional transmitters and receivers would range in cost from $500,000.00 to 1.5 million dollars to procure, in order to achieve results that are not as good as what is obtained with the Callyo system. These numbers are based off of past procurement history for purchasing Technical Listening devices (TLE). TLE are physical hardware and do not meet the requirement of having digital covert line to any smart phone.

TLEs are not easily hidden, and have range limitations hindering active personnel in Korea, Germany, and Afghanistan which hinder missions.

Control No: CAO-18-0514

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With standard technical listening equipment there must be a transmitter such as a body wire, or other device acting as a transmitter, and a receiver which must be placed so that the maximum number of officers can listen to it. This is generally a distance from where the covert operation is occurring as you don’t want to compromise the operation by the perpetrators hearing this receiver which places the back-up officers a further distance from the covert operative. With Callyo the officers are able to call in on the covert telephone number and their smart phone then becomes their receiver and they can wear a blue tooth ear piece so that they can be very close to the covert operation in order to provide back up if things go bad. The covert lines provided from Callyo work with phone companies in order to provide a line that is only accessible by Law Enforcement. This allows any number of agents to tap into an active line. This is also used for “pre-text” phone calls where victims of sexual assault call the offender and they are given a text to follow – and the line is recorded (this is of course accomplished with proper legal authority), the equipment makes it possible to obtain excellent recordings.

Procurement History:

The first contract with Callyo was contract number W15QKN-15-P-0050, on 11 August 2015, which had two option years. This contract was procured full and Open and received two possible vendors. CALLYO was found to be the only technically acceptable vendor.

The second contract with Callyo was contract number W15QKN-16-P-0039, on 11 August 2016 that had two option years. This was procured as full and open competition with two vendors providing quotes. Technical evaluation stated that CALLYO was the only vendor who was technically acceptable to meet the requirements of the Statement of Work.

The first option year was executed in August 2017, and the second option year will be executed in August 2018.

6. Publicizing Contract Actions: For FAR Part 13 actions, the public display and synopsis requirements of FAR 5.101 and FAR 5.203 do not apply due to the $ threshold, apply and will be followed, or do not apply due to an exception at 5.202

Requirement to post justification in accordance with FAR 8.405-6(b)(3), FAR 13.105(c), or FAR 16.505(a)(4)(iii)(A)

Action is NOT a brand name restriction and is under $150K, no posting required Action is a brand name restriction, under $25K, no posting required Action is a brand name restriction, over $25K. It will be redacted and posted with the solicitation.

Action is a brand name restriction over $25K but will not be posted due to exception:

FAR 6.305(f) FAR 8.405-6(b)(3)(iii)(A)

FAR 8.405-6(b)(3)(iii)(B)

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FAR 8.405-6(b)(3)(iii)(C) FAR 16.505(a)(4)(iii(C)

7. Market Research: The objective of this research was to find sources that would be able to provide the a covert telephone line system to provide Agents throughout the Command the ability to conduct covert operations, which would include the recording of specific conversations as allowed by law, and to provide surveillance teams the opportunity to hear what is happening during covert operations so they may provide sufficient backup for the undercover officers that maximizes officer safety. This system must provide covert lines that operate with any smart phone, and provide a permanent electronic record of all calls and duration. This system must have the ability to record the conversations when legal authority exists.

Initial market research was conducted at the Criminalistics meeting in Seattle Washington during the American Academy of Forensic Science (AAFS) Conference where all Army Forensic Science Officers conducted independent research regarding alternate covert technical listening equipment. The Criminal Investigation Command searched 275 vendors at the AAFS and found no products that would be able to provide covert telephone lines with software management. This research continued from February 2018 to May 2018 and several meetings were conducted with the Naval Criminal Investigative Service (NCIS), and the Air Force Office of Special Investigations (OSI), the same results were found and no other vendor could provide the specifically unique software of CALLYO On 19 June 2018 additional checks were made within GSA, and open source (internet) law enforcement products and there is no other vendor besides Callyo that can provide this technology at this time.

An RFI was posted to the Open Market for CALLYO systems from 19 June 2018 through 25 June 2018, with no responses. Law Enforcement Technologies (LETS) provided a capability statement late on 01 July 2018. LETS capability statement was reviewed by CID technical point of contact (POC) David Zeliff. David determined that LETS did not meet the requirements of the SOW. LETS product required physical hardware and did not provide covert lines that could have multiple phones tapping into one covert line. Technical evaluation of LETS has been uploaded into the Official Contracting File.

8. Other Facts: Although there are a number of vendors that can provide a variety of covert audio and video devices the technology provided by Callyo is specifically unique.

9. Technical/Requirements Certification: I certify that the supporting data under my cognizance which are included in the justification are accurate and complete to the best of my knowledge and belief.

Typed Name: David Zeliff

Control No: CAO-18-0514

Version – February 2017

Date:

Title: Forensic Science Officer

Signature: //Signed//

10. Contracting Officer Certification/Approval:

I hereby determine that the anticipated cost or price to the Government for this contract action will be fair and reasonable based upon CIDs provided Independent Government Estimate (IGE). The IGE was based upon reviewing other US Army Criminal Investigation Commands procurements for the Callyo systems. .

I certify that this justification is accurate and complete to the best of my knowledge and belief, and that completing this purchase as a sole source is in the best interest of the Government. Additionally, I approve this justification to limit competition subject to the availability of funds and provided that the services or supplies herein described have otherwise been authorized for acquisition.

Typed Name: Paul G. Lepore Date:

Title: Contracting Officer

Signature: //Signed//