FOIA Case: Who are you calling a low-ranking government official?

Via WaPo v. SIGAR (Civil Action No. 18-2622 (ABJ)
On March 23, 2017, Craig Whitlock, a reporter from plaintiff Washington Post Company (the “Post”), submitted a Freedom of Information Act (“FOIA”) request to the Special Inspector General for Afghanistan Reconstruction (“SIGAR”), the federal agency charged with auditing and supervising the U.S. reconstruction efforts in Afghanistan. Plaintiff sought records relating to SIGAR’s Lessons Learned Program (“LLP”), specifically the “full, unedited transcripts and complete audio recordings of all interviews conducted for the Lessons Learned program, regardless of whether they were labeled as ‘on the record,’ or if the interviewee was granted anonymity, or if they were cited in a particular report or not.”
Plaintiff filed the instant lawsuit on November 14, 2018, and by June of 2019, SIGAR had processed the FOIA request and produced hundreds of responsive records. But it redacted some material and declined to produce other documents in full under various FOIA exemptions, and the parties filed cross motions for summary judgment. The Court granted both motions in part and denied both in part, and it directed the defendant to provide additional information to justify withholdings that remained in dispute.
The September 30, 2021 order by District Court Judge Amy Berman Jackson is available to read here:
Below is an excerpt on high ranking and low ranking government officials:
Defendant maintains that it properly withheld information from informants interviewed by SIGAR, see Def.’s Mem. at 15–18, including high and low-ranking government officials who could be classified as “public” officials. Id. at 21–28. Defendant’s declarant explained that “[t]here does not appear to be any definition in law or regulation of the term ‘high ranking’ as applied to government employees,” Fifth Hubbard Declaration ¶ 13, and so SIGAR created its own “objective standard”:
In an attempt to use a bright-line definition in the context of the lessons learned program and to minimize subjectivity, SIGAR concluded that a “high ranking” government employee was anyone appointed by the President and confirmed by the Senate. This includes all ambassadors, generals, and admirals, all cabinet secretaries and heads of agencies, and all deputy secretaries, under secretaries, and assistant secretaries. In addition, informants who were obviously public figures with policy-making or other independent authority could be “high ranking” government employees, e.g., an individual appointed to an “acting” high-ranking position, or a special envoy.
In its cross motion for summary judgment, plaintiff claims that defendant mischaracterized some high-ranking public officials as low-ranking public officials, Pl.’s Mem. at 12–14, and that it then improperly balanced their privacy interests against the public interest in the information. See id. at 15–19.
Plaintiff accurately points out that the privacy interest diminishes and public interest increases as an official’s rank increases, see Pl.’s Mem. at 12, quoting Stern v. FBI, 737 F.2d 84, 92 (D.C. Cir. 1984), and it takes issue with the designation of five individuals as “low-ranking” or “low level” employees:
• the former Senior Advisor on Afghanistan and Pakistan to the Under Secretary of Defense for Policy;
• the former Senior Director for Afghanistan on the National Security Council;
• the Director for Afghanistan and Pakistan on the National Security Council staff;
• the former special assistant to NATO’s commander in Afghanistan, General Stanley McChrystal; and
• a senior adviser to the State Department’s Special Representative for Afghanistan and Pakistan.
Pl.’s Mem. at 13–14.15 According to plaintiff, based in part on publicly available biographies, these individuals held more important posts than the Third Vaughn Index would indicate, and therefore, the representations are “suspect,” and defendant’s declaration and Vaughn Index are “in bad faith and should be given no weight.” Pl.’s Mem. at 14.
While one can argue that these individuals played roles of importance, plaintiff has not identified evidence in the record that would overcome the presumption of good faith that attaches to the declarations. All are senior advisers to high-level decisionmakers. So while these credentialed individuals may outrank many government employees, they were not high-ranking government officials with decision-making authority that can be likened to the agency itself.

 

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@StateDept’s Deferred Maintenance Backlog For Overseas Properties Estimated at $3Billion

 

The GAO recently released its review of the State Department’s overseas real property assets:
State’s Bureau of Overseas Buildings Operations operates and maintains over 8,500 owned and leased real property assets, including both buildings and structures. According to State, at least 60 percent of a building’s total lifecycle cost stems from operations and maintenance costs. GAO has reported that deferring maintenance and repairs can lead to higher costs in the long term and pose risks to agencies’ missions.
GAO was asked to review State’s efforts to manage its operations and maintenance needs. This report examines (1) how operations and maintenance funding for overseas assets changed from fiscal years 2016 through 2020, (2) the condition and maintenance needs of State’s overseas assets, and (3) the extent to which State has followed leading practices to address its deferred maintenance backlog.
Officials said they had not found it necessary to specifically request such funding because they only determined that the backlog had substantially increased from $96 million in fiscal year 2019 to $3 billion in fiscal year 2020 after using a new methodology for estimating deferred maintenance and repair. In addition, State does not have a plan to address the backlog, but officials estimated it could take 30 to 40 years to eliminate the backlog with current funding levels.
Dear, lord! What is this going to be like by 2050?

Excerpts from the report:

Assets/Operations Up, Maintenance Funding Nearly Unchanged

–The Department of State’s portfolio of overseas assets and expenditures to operate them have grown, but State-allocated funding for maintenance has stayed nearly the same. For fiscal years 2015 through 2019, both the number and square footage of State’s assets increased 11 percent and operations expenditures grew 24 percent. However, maintenance and repair funding has remained nearly unchanged.

— State’s allocation for Maintenance Cost Sharing—for projects collectively funded by State and tenant agencies overseas—was $399 million in fiscal year 2016 and $400 million in 2020.

From fiscal years 2016 through 2020, building operating expenditures for State and other agencies that work at overseas assets increased by 24
percent, from $530 million to $656 million annually. State’s allocated funding for maintenance and repairs for overseas assets has remained about the same in recent years, averaging $505 million from fiscal years 2016 through 2020.

That $3 Billion Could be Higher

— State set a single acceptable condition standard of “fair” for all assets and did not consider whether some assets, like chancery office buildings, were more critical to State’s mission when estimating its $3 billion deferred maintenance backlog. Had State set a higher condition standard for critical assets, its backlog would be higher.

It All Adds Up Over Time

Older chancery office buildings tend to be in poor condition and are a challenge to maintain. As shown earlier in table 4, we found that 72 of
216 (or 33 percent) chancery buildings—that OBO identifies as mission
condition due to a large amount of deferred maintenance that has built up
over time.

Ambassadorial Residences Take Note

In discussing the condition of ambassadorial residences with State, OBO officials said they have taken steps to evaluate and rank State’s
ambassadorial residences that are in need of major rehabs. OBO officials told us that State has preliminarily identified the need to rehabilitate or
replace ambassadors’ residences in Beijing, China; Kathmandu, Nepal; Nairobi, Kenya; Ottawa, Canada; Paris, France; Sarajevo, Bosnia and
Herzegovina; and Tegucigalpa, Honduras. However, OBO officials said there is no formal schedule for rehabilitating ambassadorial residences
because there is no predictable annual funding for rehabilitating State-only occupied assets.

More than a Quarter of Properties in “Poor Condition”

— More than a quarter of the State Department’s overseas buildings and other real properties are in poor condition by State’s condition standards, including almost 400 buildings and other assets that State considers critical to its mission.

FY21 $100 Million Request: Specific But Not Really

According to OBO officials, they outlined specific funding requested for maintenance and repair, including minor construction and improvement, in an appendix to State’s congressional budget requests. State’s fiscal year 2021 budget requested $100 million to address DM&R for State’s non–cost shared facilities. However, OBO officials noted that this funding was for the minor construction and improvement program (or modernization
budget), which does not specifically address the DM&R backlog.

GAO made five recommendations to the State Department:

The Secretary of State should ensure that that the Director of OBO reassess State’s acceptable condition standard for all asset types and
mission dependencies, to include whether mission criticality justifies a different standard among assets. (Recommendation 1)

The Secretary of State should ensure that the Director of OBO incorporates the mission criticality of its assets when deciding how to target maintenance and repair investments. (Recommendation 2)

The Secretary of State should ensure that the Director of OBO monitors posts’ completion of annual condition assessments that use a standardized inspection methodology, so that State has complete and consistent data to address its deferred maintenance and repair backlog. (Recommendation 3)

The Secretary of State should ensure that the Director of OBO develops a plan to address State’s deferred maintenance and repair backlog, and specifically identifies the funding and time frames needed to reduce it in congressional budget requests, related reports to decision makers, or
both. (Recommendation 4)

The Secretary of State should ensure that the Director of OBO employs models for predicting the outcome of investments, analyzing tradeoffs,
and optimizing among competing investments. (Recommendation 5)

 

Click to access gao-21-497.pdf

State/OIG Audits CA’s Official and Diplomatic Passport Records

 

 

Via State/OIG:
(U) Treasury Inspector General for Tax Administration Concerns

(U) In September 2020, OIG received a referral from the Treasury Inspector General for Tax Administration (TIGTA). According to the referral, in 2019, during an audit of the Internal Revenue Service’s (IRS) passport management and security controls,19 TIGTA requested from CA information associated with diplomatic and official passports issued to IRS employees and appointees for the last 20 years, as of March 31, 2019. Specifically, for each passport issued, TIGTA requested the applicant’s name, passport number, passport type, issuance date, and passport status (e.g., cancelled, lost, or stolen).

(U) According to TIGTA officials, TIGTA received three separate passport datasets from CA. However, TIGTA found that the data provided in each dataset were incomplete. For example, some passport records had blank issuance and expiration date fields. Furthermore, the data identified onlyfive passports that were issued in 2016 and indicated that no passports were issued to IRS employees from 2017 through 2019. However, IRS records indicated that more than 200 official or diplomatic passports were issued to employees between 2016 and 2019. Lastly, one dataset included only Department of Treasury employees and not IRS employees. According to TIGTA officials, CA officials could not explain why the database was providing incomplete data. Based on the missing records and data fields, TIGTA deemed CA’s information as unreliable for use in its audit.
[…]
(U) In response to TIGTA’s concerns about receiving incomplete data from CA, OIG reviewed the  847,880 official and diplomatic passport records provided to OIG by CA and found that none of  the passport records had blank issuance or expiration date fields. Furthermore, the records  showed that CA issued 652 official and diplomatic passports to IRS employees and their family  members from FY 2017 through FY 2019 as opposed to the data provided to TIGTA, which showed that no passports were issued to IRS employees from FY 2017 through FY 2019.

The Special Issuance Agency (SIA) did not review the data!

(U) When asked about TIGTA’s concerns, CA officials stated that CA’s Office of Consular Systems and Technology ran a query in TDIS using sponsor codes28 that are associated with IRS to obtain the data requested by TIGTA. CA’s Office of Legal Affairs and Law Enforcement Liaison and the  Office of Passport Integrity and Internal Controls reviewed the data before the data were  released to TIGTA. SIA did not review the data. If SIA employees had reviewed the data, they  would have recognized that it was incomplete. SIA employees would know, because of  reimbursement data, the number of passports issued to IRS employees. CA officials also stated  that, although there are processes in place for reviewing and clearing data prior to release to Federal customers, there is not a formal written policy or standard operating procedures. CA officials are formalizing procedures to address this deficiency.

(U) CA officials indicated that requests for passport information from other agencies are infrequent—there have been none since TIGTA’s request in 2019. However, it is important that CA have effective internal control activities in place to ensure that quality data are provided to other Government agencies. Internal control is a process effected by an entity’s management that provides reasonable assurance that the objectives of an entity will be achieved.29 Management should establish control activities through policies and procedures to achieve objectives.30 Because CA had not implemented effective internal control activities to ensure that the data provided to TIGTA in response to its request were properly reviewed and validated, it failed to meet its objective of delivering a high level of customer service and earning customer trust, which consequently impacted TIGTA’s ability to conduct an audit of passport management and security at the IRS. Although OIG acknowledges that CA is developing internal control activities and associated procedures to help ensure that the incident with TIGTA is not repeated, OIG is making the following recommendation and will track its implementation through the audit compliance process to confirm that the identified deficiency has been fully addressed.

(U) Prior Office of Inspector General Reports

(U) During this audit, OIG was alerted that a former Department of State employee had  allegedly not surrendered their diplomatic passport upon separation from the Department.  Department employees’ entitlement to an official or diplomatic passport, in most instances,  ends when they separate from the Department, and the passport must be surrendered for  cancellation.

(U) OIG found that CA had not electronically cancelled one of the former employee’s diplomatic  passports. Based on that information, OIG performed additional steps to determine whether CA  had cancelled other diplomatic or official passports once an employee had separated from the  Department of State. OIG found that CA had not electronically cancelled 57 of 134 (43 percent)  passports tested.5 In addition, of these 57 passports, 47 (82 percent) had not expired as of  February 1, 2021, meaning they could still be valid. One reason for the deficiencies identified is  that bureaus and offices did not always maintain proper accountability of passports and could  not confirm whether separating employees had surrendered their passports for cancellation.  OIG made one recommendation that is intended to improve the accountability of official and  diplomatic passports of separating employees. As of June 2021, OIG considers the  recommendation resolved, pending further action.

Help! State/OBO’s Office of Fire Protection Is On Fire!

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State/OIG released its inspection report of the State Department’s Bureau of Overseas Buildings Operations/Office of Fire Protection (FIRE). Here is a quick summary:
Background

The Department of State (Department) is required to establish and maintain an effective fire protection program for its overseas operations under 29 Code of Federal Regulations Parts 1910, 1926, and 1960.The Bureau of Overseas Buildings Operations (OBO), Directorate of Operations, Office of Fire Protection (FIRE) manages and directs this program …

FIRE is led by an Office Director and the office’s staff consists of 43 Civil Service employees, 1 personal services contractor, and 11 thirdparty contractors.2 The office has three divisions: Fire Protection Analysis and Field Engineering (FPA) Division, Fire Protection Engineering (FPE) Division, and Fire Protection Systems and Engineering (FPS) Division. The FPA Division conducts fire and life safety evaluations, fire investigations,training, and fire as a weapon analysis.3 The division also evaluates local and contract fire services,oversees the emergency incident management and disaster response oversight,and administers the fire and life safety equipment logistics program for overseas posts.

Office Director Did Not Fully Model the Department’s Leadership and Management Principles

OIG found that the FIRE Office Director did not fully model the Department’s leadership and management principles outlined in 3 FAM 1214,6 especially with regards to communication, selfawareness, and managing conflict. In OIG interviews, 42 percent of FIRE staff interviewed described the director’s leadership style as difficult, specifically“autocratic” or “micromanaging” because he preferred to retain control over decisions with little input from his staff and he often involved himself in administrative activities that would be better handled by firstline supervisors. Staff also told OIG that the Office Director had a propensity for favoritism toward some FIRE employees. Some staff also said FIRE had low morale because of the Office Director’s stance on administrative issues such as not allowing overtime in situations where employees felt it was warranted to meet the office’s mission and his failure to address concerns about the accuracy of FPE Division’s engineer position descriptions and grade levels, which they believed were inaccurate.

The Office Director acknowledged to OIG that his leadership style was difficult for some FIRE employees. He noted that a longstanding dispute about the accuracy of the FPE Division’s engineer position descriptions and grade levels had a detrimental effect on morale.7 In addition, at OBO’s request,8 the Bureau of Global Talent Management (GTM) conducted an organizational assessment in 2019.9The organizational assessment focused on FIRE leadership issues,including communication, technical expert participation in the decision-making process, and collaboration among FIRE divisions. It also focused on a range of administrative issues, including the accuracy of the FPE Division’s engineer position descriptions, standard operating procedures for overtime, and service passports for third-party contractors. During the inspection, FIRE began implementing the recommendations in GTM’s organizational assessment report. However, based on FIRE’s lack of progress on standard operating procedures for overtime and obtaining service passports for third-party contractors at the time of the inspection, OIG made recommendations to address these issues, as described in the Operational Effectiveness and Program Implementation and Resource Management sections of this report. Additionally, OIG suggested to the Office Director that he contact the Foreign Service Institute’s Leadership and Management School to engage a neutral third-party facilitator to address the leadership, morale, and administrative issues reported by FIRE staff. He agreed to use these Foreign Service Institute Leadership and Management School resources to address the issues described above.

Wait, the director told the OIG that his leadership style was difficult for some FIRE employees?”  That’s some 42 percent of the staff who gave him a thumbs down.  Does it need to be 51 percent?
The same individual who does not seem to acknowledged a deficient leadership style is now asked to call FSI’s Leadership and Management School for a third party facilitator “to address the leadership, morale, and administrative issues reported by the staff?” And this was made as a “suggestion” and not even included in the formal recommendations? A suggestion by its nature may be accepted or rejected.  So there will be no follow-up required, hey?
C’mon, folks, 2035 is tad far off for a status update on these issues; your poor blogger may be living in a colony in Mars by then with spotty wifi or in the midst of a zombie apocalypse!
The good news is — the directors of the three divisions of Fire Protection Analysis and Field Engineering (FPA), Fire Protection Engineering (FPE), and Fire Protection Systems and Engineering (FPS) received positive ratings in OIG’s survey and in employee interviews.5  Apparently, the OIG survey respondents rated the three Division Directors very good to excellent for all the 10 leadership and management principles found in 3 FAM 1214, “Leadership and Management Principles for Department Employees.”
We can’t tell from the report when was the last time this office was reviewed by the OIG. It is possible that it may not been inspected for many, many years; we have not been able to find any previous reports. The current report talks about “the past 14 years” and six fiscal years, so there’s that.
Fire Casualties/Fatalities

Over the past 14 years, FIRE reported three fatalities and five injuries.10 Although the number of firerelated fatalities and injuries remained low, the number of fire incidents and the associated monetary loss fluctuated over the past 6 fiscal years, ranging from 95 to 154 incidents per fiscal year, with associated annual losses from $358,206 to $37,291,962.11 Overall, OIG found that FIRE carried out its mission to prevent firerelated fatalities and injuries and generally met its performance objectives.

Footnote 10 notes that OBO/FIRE reported three fatalities over the last 14 years:
— one locally employed staff in Islamabad in 2006,
— one Foreign Service officer in Moscow in 2014 (Also see US Embassy Moscow: FS Employee Hurt in Apartment Building Gas Explosion Dies); Death in the Foreign Service: Why we said “no” to an Embassy Information Sanitation Dude
— one local contractor in Addis Ababa in 2017
FIRE also reported five injuries:
— one locally employed staff in Islamabad in 2006
— one Foreign Service officer and one locally employed staff in Dhaka in 2007
— one locally employed staff in Addis Ababa in 2015
— one Foreign Service officer in Quito in 2019.
Footnote 11 notes that “Of the $37,291,962 total loss, which occurred in FY 2020, $35million was attributable to a fire at Embassy Baghdad following a terrorist attack.”
Other notable items:

— OIG found no requirement for COMs to attest or certify in the annual SOAthat their postshad an effective fire protection program. In addition, the templates in Annex 1o f the SOA required COMs to attest to the effectiveness of eight facility management programs but none were related to the fire protection program.

— OIG found that low participation in fire prevention training at overseas posts hindered the effectiveness of FIRE’s fire protection program. According to a cable sent to all overseas posts,14 often fewer than 20 percent of personnel assigned to post attend fire prevention training15 provided by fire marshals during their visits.

— OIG found that a lack of service passports19 for FIRE’s 11 thirdparty contractors, which would allow them to carry work tools and fire system repair parts through foreign customs,affected operational effectiveness.20FIRE’s thirdparty contractors sometimes were subjected to increased scrutiny from local customs and immigration officials when traveling on their tourist passports.For example, one of FIRE’s thirdparty contractors was detained for several hours when host government authorities discovered hand tools and electronic detection and testing equipment in his luggage, while in another instance, some of his equipment was seized. FIRE reported that obtaining a business visa from the host country has not prevented these issues.CA recommends that most thirdparty contractors should continue to travel on tourist passports. FIRE first tried to obtain a service passport for a thirdparty contractor in 2017, but CA denied the request because it determined that FIRE’s justification was insufficient.

— OIG found FIRE had an inefficient manual system for tracking overseas posts’ compliance with its fire safety inspection recommendations. Specifically, FIRE used spreadsheets to track compliance with its recommendations for more than 90 overseas post inspections.

— FIRE’s overtime policy did not fully comply with Department standards in 3 FAM 3133.1, 3 FAM 3133.2,and 3 FAM 3133.3governing regularly and irregularly scheduled overtime.22 Although FIRE’s overtime policy addressed irregularly scheduled overtime, it did not include guidelines for regularly scheduled overtime that must be scheduled in advance of a workweek. Additionally, OIG reviewed statements from supervisors in FIRE documents instructing employees that the office does not pay overtime, that employees should not submit requests for paid overtime, and that FIRE has had for many years an unwritten policy that overtime is and shall be unscheduled and therefore paid by compensatory time and not overtime pay.

Related posts:

State/OIG Reports to Congress: Investigations Into Mrs P’s Travels, Ambassadors, Senior Advisors, FSOs and More

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On June 1, 2021, State/OIG published online its Semiannual Report to the Congress (October 1, 2020 to March 31, 2021).
On  accountability and independence, the OIG reports:
“OIG did not encounter any attempts to interfere with Inspector General independence—whether through budgetary constraints designed to limit its capabilities, resistance or objection to oversight activities, or restrictions on or significant delays in access to information—for the reporting period from October 1, 2020, through March 31, 2021.
OIG encountered a three-month delay in scheduling an interview with Secretary Michael Pompeo as part of its review of allegations of misuse of Department resources. OIG initially requested an interview on September 11, 2020, but then-Secretary Pompeo did not agree to the interview (which was scheduled for December 23, 2020) until December 16, 2020.
During a mandated review of the Bureau of International Narcotics and Law Enforcement Affairs’ (INL) reporting related to National Drug Control Program activities, INL was not sufficiently responsive to OIG’s requests for information. At the conclusion of fieldwork, OIG determined that it could not complete its review because it did not have sufficient, appropriate evidence to be able to draw a conclusion about whether the Department’s management assertions in its Accounting and Authentication of FY 2020 Drug Control Funds and Related Performance Report were fairly stated.”
The Office of Evaluations and Special Projects (ESP):
“From October 1, 2020, to March 31, 2021, ESP issued one unclassified report on Department programs and operations. Management Assistance Report: Representational Travel by the Spouse of the Secretary of State (ESP-21-01, 12/2020) In 2019, OIG received a whistleblower complaint related to travel by the spouse of the Secretary of State that the Department considered official travel. To investigate this complaint, OIG requested and reviewed documentation related to official representational family travel by Susan Pompeo from April 2018 to April 2020. Generally, Department policy permits such travel by relatives of Department officials for appropriate representational purposes. However, both Department guidance and principles of internal control require documentation of both the official purpose and the approval of the travel. The Secretary’s spouse took eight trips that were declared official from April 2018 to April 2020. Of the eight trips, OIG found documentation of an authorized purpose for all eight trips, but only found written approval for two of the trips.
OIG recommended that the Office of the Secretary seek and gain written approval for all representational travel, and that the Under Secretary for Management or other authorizing official document in writing the approval for all representational trips by any family members. The Department concurred with these recommendations.”
ESP Substantiation of Allegations of Non-Criminal Misconduct Involving Senior Government Employees, 10/1/2020–3/31/2021
— A case closed in January 2021 involved a U.S. Ambassador. “OIG found that the official committed several violations of Department policy, including involving a household member in official duties, using personal social media accounts for official activities, and failing to comply with 3 FAM 1214.1 “Leadership and Management Principles for Department Employees” and “The Standards of Ethical Conduct for Employees of the Executive Branch,” issued by the U.S. Office of Government Ethics. OIG referred its findings to the Under Secretary for Political Affairs and the Bureau of African Affairs. Shortly after OIG issued its findings, the Ambassador left office as part of the presidential transition.”
— A case closed in March 2021 involved a USAGM Senior Advisor.  “OIG found that the official violated Federal recordkeeping regulations by instructing employees to communicate with her on official matters using a mobile messaging application and then deleting the messages without properly preserving them in agency recordkeeping systems. OIG referred its findings to USAGM, which reviewed the matter and notified the National Archives and Records Administration of the improper disposal of Federal records.”
The Office of Investigations conducts worldwide investigations of criminal, civil, and administrative misconduct related to programs and operations of the Department. During the reporting period, OIG conducted a number of investigations involving senior Government employees.
Investigations Involving Senior Government Employees Where Allegations Were Substantiated, 10/1/2020–3/31/2021
— On June 12, 2015, OIG opened an investigation based on information that a senior Administrative Officer and two of her subordinates violated procurement rules and regulations related to the use of U.S. Government purchase cards. The investigation substantiated the allegation and revealed the officer instructed her employees to engage in the practice of split purchasing. As there was no violation of criminal law, the case was not referred to DOJ. However, the officer resigned from the Department while under investigation. The case was closed in January 2021.
— On October 28, 2019, OIG opened an investigation based on information that the senior advisor to a U.S. Ambassador serving overseas may have received supplemental compensation from a private company while serving as a U.S. Government employee. The investigation revealed the advisor transmitted Sensitive But Unclassified information to non-U.S. Government personnel and received gifts of airfare and a gift card valued over $8,000 from a private business entity. As there was no violation of criminal law, the case was not referred to DOJ. However, the officer resigned from the Department while under investigation. The case was closed in February 2021.
— On May 29, 2019, OIG opened an investigation regarding multiple allegations of misconduct by a U.S. Ambassador. The investigation revealed the Ambassador inappropriately used his position to try to influence the move of a professional sporting event to a different venue. He also knowingly allowed his special assistant to conduct personal matters that fell outside of her scope of official duties, and while using non-Department email accounts, he did not courtesy copy or forward to his official Department email account at least 62 official emails in the span of approximately 6 months.As there was no violation of criminal law, the case was not referred to DOJ. However, the Ambassador resigned from the Department while under investigation. The case was closed in February 2021.
Under notable resolutions, State/OIG/INV’s list includes the following:
— In March 2021,  two Foreign Service Officers agreed to pay more than $13,033 to the U.S. Government to resolve issues related to fraud allegations regarding Department travel vouchers. OIG special agents determined that the married couple engaged in a scheme to defraud the Department by filing four travel vouchers that claimed lodging expenses they were not entitled to under Federal Travel Regulations. The fraud was committed from approximately September 2014 through April 2019. OIG’s Office of General Counsel coordinated the Program Fraud Civil Remedies Act action that resulted in the settlement.
–In October 2020, three individuals were indicted for using a business email compromise scheme, or BEC, to defraud the Department. OIG and Federal Bureau of Investigation (FBI) special agents determined the individuals tricked the Department and a nonprofit agency into wiring at least $575,000 into bank accounts they controlled for the purpose of enriching themselves and their co-conspirators.
Under employee misconduct:
— In November 2020, former Seabee Martin Huizar was sentenced to 109 months’ incarceration and ordered to pay $40,100 in fines and $10,000 in restitution, along with serving a 10-year term of supervised release, for transportation of images of child sexual abuse on his phones and tablet computer. The OIG Special Assistant United States Attorney assigned to the Eastern District of Virginia prosecuted the case.
 

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SDNY Charges @StateDept Contractor in Multimillion-Dollar Fraud Schemes, Then There’s “Insider-1” at OBO

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On May 28, 2021, USDOJ/Southern District of New York announced the arrest of SINA MOAYEDI, the owner of a construction company on charges of wire fraud, conspiracy to commit wire fraud, and one count of bribery of a public official. According to the announcement, “Sina Moayedi allegedly paid lucrative bribes to a State Department insider in exchange for confidential bidding information, and fraudulently induced the State Department to pay his company approximately $100 million.” Excerpt from the announcement:

Manhattan U.S. Attorney Audrey Strauss said:  “As alleged, Sina Moayedi made misrepresentations about his employees’ qualifications and his company’s ownership in order to induce the State Department into awarding approximately $100 million in lucrative construction contracts to Moayedi’s company, Montage, Inc.  Moayedi also allegedly cultivated a State Department insider, and paid the insider lucrative bribes in exchange for confidential State Department bidding information.  Moayedi must now be held accountable for his alleged brazen fraud on the government.”

Special Agent in Charge Michael Speckhardt said:  “As alleged, the defendant’s scheme to undermine the Department’s procurement process for personal gain caught up with him today and he will now be held accountable.  His alleged actions not only hurt other legitimate businesses competing for awards, but also damage the public’s trust in the effective and efficient utilization of taxpayer money.”

According to allegations in the Complaint[1]:

Montage, Inc. (“Montage”) is a U.S.-based business that is primarily involved in worldwide Government construction projects, including embassies, military posts, consulates, and similar overseas properties owned and operated by the United States Government.  Montage has performed over $220 million in contracting work for the U.S. Government, including for the Department of Defense, the Department of Justice/Federal Bureau of Investigation, the State Department, the Department of the Interior, the Department of Agriculture, the National Aeronautics and Space Administration (“NASA”), the Equal Employment Opportunity Commission (“EEOC”), and the Department of Veterans Affairs.  Since 2014, Montage appears to have focused primarily on competing for and obtaining contracts with the State Department.  During that period, the State Department has awarded Montage approximately six overseas U.S. Embassy/Consulate construction project contracts totaling $100 million, in locales such as Ecuador, Spain, Sudan, the Czech Republic, and Bermuda.  The founder of Montage is SINA MOAYEDI.

Montage engaged in at least two fraud schemes.  The first scheme alleges that, from approximately 2014 to September 2020, MOAYEDI and Montage lied that it was a female-owned business in order to secure unmerited advantages in the bidding process.  By way of context, it is advantageous to a company, when bidding for federal government contracts, to be majority-owned by an individual from a socially or economically disadvantaged community.  In fact, certain contracts (or portions of contracts) are “set aside” for – i.e., only available to – such companies.  MOAYEDI and Montage repeatedly represented falsely in submissions to the State Department that Montage was female-owned, or female-owned and minority-owned, in order falsely to induce the State Department to award Montage lucrative construction contracts.  In actuality, MOAYEDI repeatedly lied about Montage being a female-owned business, and indeed, MOAYEDI controls Montage and makes all material decisions on Montage’s behalf.  As MOAYEDI revealed to a bank that inquired about Montage’s ownership status, “I am the sole owner and president of Montage and have always been.”  Montage and MOAYEDI also repeatedly misrepresented, and significantly overstated, the qualifications of Montage employees.  MOAYEDI made these misrepresentations in order to, among other things, meet State Department and contractual requirements for minimum experience in certain key positions.

The second scheme charged in the Complaint is a bribery scheme during at least 2016 and 2017.  Insider-1 is employed in the State Department’s Overseas Building Operations (“OBO”), which, according to OBO’s website, “directs the worldwide overseas building program for the Department of State and the U.S. Government community serving abroad.”  Specifically, Insider-1 works for the State Department’s OBO Project Development and Coordination Division, European division.  
[…]
MOAYEDI, 66, of Chevy Chase, Maryland, is charged with one count of wire fraud, and one count of conspiracy to commit wire fraud, each of which carries a maximum potential prison sentence of 20 years, and one count of bribery of a public official, which carries a maximum potential prison sentence of 15 years.  
[…]
[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth below constitute only allegations, and every fact described should be treated as an allegation.

Download U.S. v Sina Moayedi complaint (21 mag 5598).pdf
Excerpt from complaint:

15. Based on my review of State Department records, I am aware that between approximately 2014 and 2017, Montage was awarded six U.S. embassy/consulate construction projects with the State Department, worth a total of approximately $100 million.
[…]
26. Based on information derived from witness interviews, I reviewed resumes submitted by Montage for various State Department projects. Department requirements referenced in the contract specify certain levels of experience in order to serve as “key personnel” (i.e., personnel whom the State Department has deemed critical to the safe, successful, and timely completion of a project).
[…]
In the course of my review, I identified numerous deficiencies regarding the resumes of key personnel submitted to the State Department for the Guayaquil, Ecuador project.

a. For example, Montage submitted an individual for the key role of Project Controls Engineer and Site Health Project Manager. In the claimed experience for this individual, it stated that he was employed at Montage since 2008 and had “inspected emergency egress and life/safety issues” and conducted “inspections of asbestos containment.” In fact, this individual had only been employed at Montage for approximately one year, and served in an office staff capacity, performing none of those duties.
[…]
[O]ne Montage employee’s resume claimed that he had earned a bachelor’s Degree in Civil Engineering and also claimed years of full-time complex work in the construction field in various capacities over several years. Neither representation was true. In fact, this individual testified at a deposition that they did not graduate; and this individual’s SF-86 security clearance application noted that this individual had actually sold meat as a door-to-door salesman, was a landscaper, and built swimming pools for several years during the period that they had claimed years of full-time complex work in the construction field.
[…]
39. I am aware, from my personal participation, that a judicially authorized search warrant was executed at the residence of Insider-1, on or about May 20, 2021. On that date, Insider-1 was informed, in substance, that she was not in custody, she was free to go, and she was not required to speak with law enforcement agents. She then participated in a voluntary interview with myself and an SDNY Special Agent on her back porch, and she made the following statements, in substance and part:

a. At first, Insider-1 claimed to have sold a large green rug to SINA MOAYEDI, the defendant, for about $60,000, but she said that the payment for the rug came from MOAYEDI’s friend.

Read more here.
The Daily Beast has identified the OBO insider in their May 27 report as well as provided the link to the Salehi Search Warrant; she has not been charged.
The document is 145 pages, the allegations spans many years and the government appears to be looking at multiple embassy projects.  The project in Guayaquil, Ecuador gets top mention. The search warrant executed includes “Records and information relating to forged submittals for the Guayaquil Consulate Project in Ecuador, and other State Department or other Government construction projects” and “Records and information that constitute evidence concerning persons who either (i) collaborated, conspired, or assisted (knowingly or unknowingly) the commission of the criminal activity under investigation; or (ii) communicated with MOAYEDI or other MONTAGE employees about matters relating to the criminal activity under investigation, including records that help reveal their whereabouts.”

Related news:

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Indictments For Alleged Large-Scale Visa Fraud Employment Scheme

The fundraising campaign is closer to its goal today than yesterday, but it’s not quite there yet. We are grateful to the more than 450 donors who have supported our annual fundraising to-date. We will not run an indefinite campaign, just a few weeks out of the year.  Help us meet our goal so we can get back to our regular blogging programming. If you are able to help, you may pitch in at GFM: https://gofund.me/32671a27. Thanks – DS

 

On April 20, USDOJ announced the indictment of two businesses and nine of their officers and managers for an alleged large-scale visa fraud employment scheme. Excerpt from the announcement:

An indictment returned by a federal grand jury in the Southern District of Georgia has been unsealed charging two businesses and nine of their officers and managers located across the country for their roles in an alleged conspiracy to defraud the U.S. government and commit various fraud and criminal immigration offenses for profit.

According to court documents, Regal Hospitality Solutions, LLC; Educational World, Inc.; Karen Makaryan, 42, Sargis Makaryan, 42, and Samvel Nikoghosyan, 40, of Destrehan, La.; Artur Grigoryan, 38, of Biloxi, Miss.; Armen Ayrapetyan, 37, of Duluth, Ga.; Jason Hill, 28, of Virginia Beach, Va.; Fremie Balbastro, 49, of Myrtle Beach, S.C.; and Larisa Khariton, 73, and Jon Clark, 71, of North Port, Fla., were charged in a 36-count indictment returned by a federal grand jury on April 8. Each defendant was charged with one count of conspiracy to defraud and commit offenses against the United States, including encouraging and inducing an alien to reside in the United States, alien harboring, transporting aliens, and visa fraud.  Each defendant also was charged with substantive counts of encouraging and inducing an alien to reside in the United States, alien harboring, and transportation of aliens. In addition, Regal Hospitality Solutions, LLC; Karen Makaryan; Sargis Makaryan; Samvel Nikoghosyan; Artur Grigoryan; Armen Ayrapetyan; Fremie Balbastro; and Jason Hill were also charged with one count of conspiracy to commit wire fraud and 10 counts of wire fraud.

“The defendants in this case allegedly engaged in an expansive conspiracy to enrich themselves by exploiting both the immigration system and noncitizen workers,” said Acting Assistant Attorney General Nicholas L. McQuaid of the Justice Department’s Criminal Division. “Systemic fraud and abuse of U.S. visa programs and processes designed to protect American workers and businesses will not be tolerated, and offenders will be held accountable.”
[…]
“The Department’s Bureau of Educational and Cultural Affairs aims to increase mutual understanding between the people of the United States and the people of other countries by means of educational and cultural exchange,” said Acting Assistant Inspector General for Investigations Robert Smolich of the U.S. Department of State, Office of Inspector General, Office of Investigations. “When bad actors corrupt these programs for personal gain, it not only diminishes an important tool of diplomacy, it harms the thousands of individuals who participate in these programs hoping to gain skills and experience to make a better life. Today we took a step forward in restoring integrity back to those programs.”

“These defendants’ alleged scheme to game the immigration system and defraud the government has backfired and they will now be held accountable,” said Special Agent in Charge Katrina W. Berger of Homeland Security Investigations (HSI), Georgia and Alabama. “Schemes like this not only exploit the noncitizen workers involved, they also damage the other legitimate businesses in the community. Protecting the integrity of the visa program and immigration system is vital to the security of our nation.”
[…]
Individual defendants have made their initial court appearances and the arraignment of all defendants will be scheduled before U.S. Magistrate Judge Benjamin W. Cheesbro of the U.S. District Court for the Southern District of Georgia. If convicted, the individual defendants face maximum potential statutory penalties of five years in prison on the count of conspiracy to defraud and commit offenses against the United States; 10 years in prison on the counts of encouraging and inducing an alien to reside in the United States, alien harboring, and transportation of aliens; and 20 years in prison on the counts of wire fraud conspiracy and substantive wire fraud. The organizational defendants are subject to a maximum fine on each count of conviction of $500,000 or twice the gross amount of gain or loss resulting from the offense. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

The U.S. Department of State Office of Inspector General is investigating the case with assistance provided by HSI and U.S. Citizenship and Immigration Services.

Trial Attorneys Frank Rangoussis and John-Alex Romano of the Criminal Division’s Human Rights and Special Prosecutions Section and Assistant U.S. Attorney Alejandro V. Pascual IV of the Southern District of Georgia are prosecuting the case.

An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

Read the full announcement here.

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#HavanaSyndrome: Directed-Energy Attacks Now Reported in D.C.

Once a year, we ask for your support to keep this blog and your dedicated blogger going. So here we are on Week #7 of our eight-week annual fundraising. Our previous funding ran out in August 2020. We recognize that blogging life has no certainty, and this year is no exception.  If you care what we do here, please see GFM: https://gofund.me/32671a27.  We could use your help. Grazie!  Merci! Gracias!

On April 28, NBC’s Josh Lederman reported that a group of Canadian diplomats have accessed Canada’s government of withholding information about new cases of brain injury resulting from “Havana Syndrome”.  The report also says that the diplomats are citing “unacceptable delays” on coordinating care for Canadians affected, including numerous children who were accompanying their parents in Cuba. “Who knows what the long-term impacts will be?” the diplomats wrote.
Who knows what the long-term effect will be for the employees affected and the family members who were at these posts? For the State Department, the magic number appears to remain at 41 for those officially diagnosed. We do not have the number of employees who were not officially counted but whose lives and health were upended by the Department’s botched response to these attacks. We do not even know how many Foreign Service kids were similarly affected by these attacks.  Given the Department’s poor track record of handing these incidents going back to Moscow in the 1970’s, we need to keep asking questions.  Congress needs to step up in its oversight.
Back in early April, one of the questions we asked the State Department is to confirm that the mystery illness has been reported domestically (WH staffer in Arlington, a couple at UPENN)?  The State Department refused to answer that question and all our other questions.  See the rest of the questions here: Havana Syndrome Questions @StateDept Refuses to Answer.  We added a submitted question: #17. Why not expand the mandate of Ambassador Spratlen to include instances of previous microwave attacks, since those episodes were handled so badly by the State Department? Here is a little background: https://shoeone.blogspot.com/2013/09/moscow-microwaves.html
CNN is now reporting that “federal agencies are investigating at least two possible incidents on US soil, including one near the White House in November of last year, that appear similar to mysterious, invisible attacks that have led to debilitating symptoms for dozens of US personnel abroad. Multiple sources familiar with the matter tell CNN that while the Pentagon and other agencies probing the matter have reached no clear conclusions on what happened, the fact that such an attack might have taken place so close to the White House is particularly alarming.”
So there. Now that this has become “particularly alarming,” maybe we’ll learn some more?
Pardon me, what do you mean  …. “NO”!?
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Foggy Bottom’s Humongous Professional Ethos Poster Board Deserves a New Life

We are starting Week #6 of our eight-week annual fundraising. Our previous funding ran out in August 2020.  If you think what we do here is useful, we could use your help. Please see GFM: https://gofund.me/32671a27

 

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