Sig also won contracts for suppressors, optics, and probably more I'm unaware of or can't remember. Unit cost of the M7 is several times higher than the M4, it's heavier, has more recoil, carries less ammo, and the cartridge it fires is still stopped by commonly available body armor that's manufactured today.
Corruption is obvious in my mind, it's shocking Congress seems either oblivious or so complacent.
The requirements may be goofy, but that's a requirements problem and not a Sig problem.