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@StateDept Now Required to Report Allegations and Investigations to OIG Within 5 Days

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Posted: 1:53 am ET

 

In the Spring 2017 OIG Report to Congress, State/OIG informed Congress of the following:

OIG did not encounter any attempts to interfere with IG independence—whether through budgetary constraints designed to limit its capabilities or otherwise—for the reporting period from October 1, 2016, through March 31, 2017.

During this reporting period, OIG identified the following incidents where the Department resisted or objected to oversight activities or restricted or significantly delayed access to information. The incidents either arose during or persisted into this reporting period. As to each item, OIG has addressed the issue as described below:

The Bureau of Diplomatic Security (DS) has limited and continues to limit OIG’s permanent worldwide access to specific DS systems that OIG requires to conduct its oversight activities. OIG has and continues to make repeated requests for access, and DS has denied or revoked access without notice. At this time, OIG is working with the Department to correct this situation.

The Bureau of International Narcotics and Law Enforcement Affairs (INL) delayed OIG access to requested information. OIG worked with the Department and sub- sequently obtained the required information. OIG continues to work with the Department to ensure that, in the future, INL provides requested information in a timely manner.

OIG previously explained in response to other requests from Congress that it had faced challenges investigating allegations of criminal or serious misconduct by Department employees. This limitation was addressed in recent legislation— enacted in December 2016—that requires the Department to submit to OIG within 5 days a report of certain allegations of misconduct, waste, fraud, and abuse. OIG and the Department are actively working to ensure that these reports are provided in a timely manner and that OIG receives all necessary information as required by the statute.

Related items to read:

On or about this time, the State Department has also updated 1 FAM 050 of the Foreign Affairs Manual as the reporting requirement was included in the Department of State Authorities Act for Fiscal Year 2017:

1 FAM 053.2-6  Required Reporting of Allegations to the OIG
(CT:ORG-411;   04-13-2017)

a. Effective December 16, 2016, section 209(c)(6) of the Foreign Service Act of 1980, as added by section 203 of the Department of State Authorities Act, Fiscal Year 2017 (22 U.S.C. 3929(c)(6)), provides:

REQUIRED REPORTING OF ALLEGATIONS AND INVESTIGATIONS AND INSPECTOR GENERAL AUTHORITY.—

(A) IN GENERAL.—The head of a bureau, post, or other office of the Department of State (in this paragraph referred to as a ‘Department entity’) shall submit to the Inspector General a report of any allegation of—

(i) waste, fraud, or abuse in a Department program or operation;

(ii) criminal or serious misconduct on the part of a Department employee at the FS–1, GS–15, or GM–15 level or higher;

(iii) criminal misconduct on the part of a Department employee; and

(iv) serious, noncriminal misconduct on the part of any Department employee who is authorized to carry a weapon, make arrests, or conduct searches, such as conduct that, if proved, would constitute perjury or material dishonesty, warrant suspension as discipline for a first offense, or result in loss of law enforcement authority.

(B) DEADLINE.—The head of a Department entity shall submit to the Inspector General a report of an allegation described in subparagraph (A) not later than 5 business days after the date on which the head of such Department entity is made aware of such allegation.

b. Any allegation meeting the criteria reflected in the statute should immediately be brought to the attention of the relevant head of a bureau, post, or bureau-level office. (Bureau-level offices are entities on the Department’s organizational chart as revised from time to time, see Department Organizational Chart.)

c.  The first report by any Department entity should cover the period beginning December 16, 2016 (the day the law went into effect), and ending not later than five business days before the date of that report. Thereafter, any additional reportable information is due not later than the five-business day deadline stated in the statute. 

d. Questions regarding this reporting requirement may be directed to the Office of the Legal Adviser for Management (L/M), or the OIG’s General Counsel or Deputy General Counsel.

e. As outlined in 1 FAM 053.2-5, any Department employee or other personnel may continue to raise any allegations directly to OIG, via the OIG Hotline, internalhotline@stateoig.gov, or 1-800-409-9926, or the other methods listed elsewhere in the FAM.  All Employees, Locally Employed Staff, Foreign National Employees, individuals providing services via Personal Service Agreements (PSAs), Personal Service Contractors (PSCs), third party contractors, subcontractors, and grantees at all levels are also reminded of the existing reporting requirement contained in 1 FAM 053.2-5 paragraph d and the existing reporting requirements regarding criminal activity, employee misconduct, allegations of harassment, or any other reportable offenses to the relevant action office in Washington.

f.  Below is a reporting template, which may be modified pursuant to the situation or needs of the reporting entity.  

The FAM reporting template notes the following:

The information provided in this report is preliminary and may be unsubstantiated.  Any records or information provided to the OIG in the preliminary report are compiled for law enforcement purposes under the meaning of the Freedom of Information Act, 5 U.S.C. 552.  The information in this preliminary report may constitute Personally Identifiable Information.  The unauthorized disclosure of information contained in this preliminary report could reasonably be expected to constitute a violation of the Privacy Act of 1974, 5 U.S.C. 552a.  To the extent the information pertains to an open investigation, the release of such preliminary information could reasonably be expected to interfere with enforcement proceedings.

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Burn Bag: Why is INL so enamored with aerial fumigation?

Posted: 1:18 am EDT

 

Via Burn Bag:

The U.S. Government never discusses the fact that flows of cocaine to the U.S. and the coca crop in Colombia do not correlate. Since there is no science behind this, why is INL [Bureau of International Narcotics and Law Enforcement Affairs] so enamored with spray? What interests are driving this program? 

via tumblr.com

via tumblr.com

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Colombia Health Ministry Calls For Suspension of Aerial Herbicide Fumigation, Defense Ministry Pushes Back

Posted: 12:40 pm PDT

 

We did a few posts on the aerial fumigation in Colombia last month.  See: State/INL: Anti-Drug Aerial Eradication in Colombia and the Cancer-Linked Herbicide, What Now?;  So, who wants to drink up or be in target area for next aerial fumigation in Colombia?Colombia Counternarcotics Program Costs Over $8 Billion the Last 11 Years, Where’s the Audit Trail?

Last week, the Colombia Health Ministry recommended that the aerial fumigation in the country be suspended. The Colombian Defense Ministry was quick to pushed back.

This is the same week when Deputy Secretary of State Antony Blinken was in Colombia for the U.S.-Colombia High-Level Partnership Dialogue and the Steering Committee for the U.S.-Colombia Action Plan on Racial and Ethnic Equality, and joined the High-Level Strategic Security Dialogue.

 

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Below is an excerpt from WOLA’s Adam IsacsonSenior Associate for Regional Security Policy:  Even if Glyphosate Were Safe, Fumigation in Colombia Would Be a Bad Policy. Here’s Why.

Colombia is the only coca-growing country that allows aerial herbicide fumigation. Faced with the possibility that it may be aerially spraying carcinogens over its own citizens, Colombia’s Health Ministry issued a statement late Monday recommending that the aerial fumigation program be suspended.

Whether to suspend the program is up to Colombian President Juan Manuel Santos, who has yet to make or schedule an announcement. Meanwhile, Colombian government agencies that carry out the fumigation program have been quick to push back. “We cannot permit losing the benefits [of spraying] on delinquency, crime and terrorism,” said Defense Minister Juan Carlos Pinzón, who oversees Colombia’s National Police and its counternarcotics division, which performs the spraying. “We will continue using all our tools that help maintain security for Colombians.”

U.S. government officials say that while they will respect Colombia’s sovereign decision, they insist that glyphosate is safe and that they’d rather not see the spray program end. The State Department’s International Narcotics and Law Enforcement bureau has spent somewhere between US$1 billion and US$2 billion on herbicides, contractor pilots and mechanics, police escort helicopters, fuel, search-and-rescue teams, and related fumigation costs since the program began in 1994.
[…]
The lesson of Colombia’s fumigation program is that there is no substitute for economic development and government presence in national territory. The opposite—flying anonymously above without any presence on the ground—causes the coca trade to migrate and alienates populations whose support is necessary amid an armed conflict. When not coordinated with food security and alternative livelihoods, fumigation also gives guerrillas a powerful propaganda tool: the FARC and ELN have heavily employed the argument that the spraying is proof that Colombia’s “oligarchy” either doesn’t care about peasants, or wants to use the spraying to dispossess them of their lands.

Read in full here.

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Snapshot: State/INL’s Counternarcotics Program Afghanistan — $220 Million With Unclear Results

Posted: 1:04  am EDT

 

Via State/OIG:

Afghanistan produces three-quarters of the world’s illicit opium, with cultivation reaching a record high in 2013. To reduce, among other things, illicit opium revenue for the insurgency in Afghanistan, the Department of State (Department), Bureau of International Narcotics and Law Enforcement Affairs (INL), assists the Government of the Islamic Republic of Afghanistan (GIRoA) with initiatives aimed at reducing opium’s supply and demand. Since 2006, INL has expended $220 million on seven Counternarcotics (CN) initiatives in Afghanistan according to its Financial Management Activity Report (FMAR).
[…]
The degree to which INL’s CN program for Afghanistan has achieved desired results is unclear because INL has not fully developed or implemented Performance Measurement Plans (PMPs)2 to track progress for its CN initiatives and to allow for appropriate budgeting. As a result, INL cannot determine whether its Afghan CN initiatives are successful or should be revised, reduced, or canceled. Additionally, the long-term viability of CN initiatives is unclear because INL had not worked with the GIRoA to develop required sustainment plans that detail how CN initiatives will continue without U.S. assistance.

Screen Shot 2015-03-25

Click on image for larger view. (Click here for OIG report in pdf)

Above graphic extracted from State/OIG Audit of Bureau of International Narcotics and Law Enforcement Affairs Counternarcotics Assistance to Afghanistan, November 2014 (pdf).

Related to our blog post on Colombia, note that INL’s program in Afghanistan does not seem to include aerial eradication ( see State/INL: Anti-Drug Aerial Eradication in Colombia and the Cancer-Linked Herbicide, What Now?).

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State/INL: Anti-Drug Aerial Eradication in Colombia and the Cancer-Linked Herbicide, What Now?

Posted: 3:35  am EDT

 

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Somebody just wrote us a note saying “It’s not clear why the Department has such a hard time with the facts … Colombian academics and others have offered convincing evidence that spraying roundup in their country is a major health issue and yet the Department resorts to ad hominem attacks rather than dealing with the facts.”  

Two academics were allegedly “treated poorly” when they tried to discuss their findings with the INL staff at the U.S. Embassy in Bogotá in 2013. We have no way of confirming this either way but given the recent news from the World Health Organization, we wanted to know what happens now.   The embassy’s aerial eradication page appears to be outdated by several years.  Its Public Affairs Office does not have a publicly listed contact email. We have reached out to a couple of offices in Foggy Bottom but have not heard anything back.

In 2012, Jenny O’Connor wrote a piece in CounterPunch about Colombia’s Agent Orange. She noted that a core element of U.S. anti-drugs policy in Colombia has been the destruction of coca fields by aerial chemical fumigation thus impacting the cocaine trade at its source.  She cited the Chaco Government investigation in 2010 where its report found that “since the use of glyphosate based herbicides began in 2002 the communities most exposed had experienced an alarming increase in birth defects, spontaneous abortion and leukaemia, brain tumours and lymphomas in children under the age of 15.”

In 2013, WOLA described the coca fumigation in Colombia:

Aircraft, mostly piloted by contractor personnel, fly over coca-growing zones spraying “Round-Up Ultra,” an herbicide including the active ingredient glyphosate, over about 100,000 hectares per year of Colombian territory. Between 1996 and 2012, aircraft have sprayed herbicides over 1.6 million hectares of Colombia—an area equivalent to a square 80 miles on each side. The corners of such a square would stretch from the Washington suburbs to the Philadelphia suburbs. That’s the equivalent of one hectare sprayed every 5 minutes and 29 seconds since January 1, 1996.
[…]
While fumigation has contributed modestly to reduced coca growing, it has done so at a steep cost, both in dollars and in goodwill toward Colombia’s government in conflictive territories where it is most needed.
[…]
Testimonies of health and environmental damage from fumigation have proliferated, but are hard to verify. Still, the damage to the government’s credibility is already done when the local population believes them to be true. And nearly everyone in affected zones can cite a case of legal food crops destroyed by spraying, forcing families to confront hunger.

 

It looks like the last certification posted online on the Secretary of State’s certification on the aerial eradication is dated August 10, 2007.

Memorandum of Justification Concerning the Secretary of State’s 2007 Certification of Conditions Related to the Aerial Eradication of Illicit Coca in Colombia

The Secretary of State determined and certified in 2002, 2003, 2004, 2005, and 2006 that the herbicide mixture, in the manner it is being used, does not pose unreasonable risks or adverse effects to humans or the environment. After previous consultations with EPA, the Department of State and the Government of Colombia have incorporated all EPA recommendations to strengthen spray program controls and ensure increased protection against adverse effects to humans and the environment. The Department of State is not aware of any published scientific evidence of risks or adverse effects to humans or the environment that have surfaced since the 2006 certification. Included below is a brief review of the conditions that allow the Secretary to recertify to Congress in 2007 that the herbicide mixture, in the manner it is being used, does not pose unreasonable risks or adverse effects to humans or the environment.

In the 2004 EPA report, EPA offered the following assessment of human health concerns related to the spraying of coca in Colombia: “Despite an aggressive search for cases, there does not appear to be any evidence that glyphosate aerial spraying has resulted in any adverse health effects among the population where this spraying takes place.” EPA also concluded “that an aggressive program to identify glyphosate poisoning has been implemented in the areas of Colombia where illicit crop eradication spraying programs are prevalent.” A significant number of health care providers have received training and additional training is under way or planned.

We have been unable to locate a more recent justification for the use of glyphosate in aerial spraying.  If there is a more recent one, please send us a link.

 

State/INL’s 2015 International Narcotics Control Strategy Report (INCSR) includes the following details:

Colombian Ministry of Defense authorities reported seizing over 207.4 MT of cocaine and cocaine base in 2014, and eliminated tons of additional potential cocaine through the combined aerial and manual eradication of 67,234 ha of coca over the year.
[…]
In areas where Colombia allows aerial eradication, coca fields are less productive than they were when eradication operations began in the late 1990s. Nevertheless, illicit cultivation continues and is increasing in Colombia’s national parks, indigenous reserves, the department of Norte de Santander, and within a 10-kilometer zone along the border with Ecuador, where Colombian law or international and regional agreements prohibit aerial eradication.

In late 2014, the governments of Colombia and Ecuador implemented an agreement to reduce the border exclusion zone to 5 kilometers which permits expanded aerial eradication along the Colombian-Ecuadorian border. Colombia aerially eradicated 55,532 ha of coca in 2014, surpassing its goal of 55,000 ha. Colombia manually eradicated 11,702 ha of coca in 2014, falling short of its goal of 14,000 ha. Numerous local level protests blocking access roads to coca fields were a major obstacle to manual eradication’s ability to operate in major coca growing regions.

The Wall Street Journal reports that the EPA concluded in a 2012 study that glyphosate meets safety standards for human health when used in keeping with its label. The agency is reportedly conducting a scheduled review of glyphosate in conjunction with Canadian regulators.

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State Dept Security Officer Alleged Sexual Misconduct: Spans 10 Years, 7 Posts

— Domani Spero

 

One of the most serious allegations contained in the CBS News report last year include a regional security officer (RSO) reportedly assigned in Lebanon who “engaged in sexual assaults” with local guards.

The memo, reported by CBS News’ John Miller, cited eight specific examples, including allegations that a State Department security official in Beirut “engaged in sexual assaults” with foreign nationals hired as embassy guards and the charge and that members of former Secretary of State Hillary Clinton’s security detail “engaged prostitutes while on official trips in foreign countries” — a problem the report says was “endemic.”

USA Today reported that the regional security officer in Beirut allegedly sexually assaulted guards and was accused of similar assaults in Baghdad, Khartoum and Monrovia. Then-director of Diplomatic Security Service, called the allegations a “witch hunt” and gave agents “only three days” to investigate, and no charges were brought.

It turns out, according to State/OIG that this RSO already had “a long history of similar misconduct allegations dating back 10 years at seven other posts where he worked”

It boggles the mind … the RSO typically supervises the local guard force!

Seven posts! Just stop and think about that for a moment. This was the embassy’s top security officer; a sworn federal law enforcement officer who was responsible for the security of Foreign Service personnel, property, and sensitive information throughout the world.

Below is an excerpt from the State/OIG investigation. We regret if this is going to make you puke, but here it is:

The second DS internal investigation in which OIG found an appearance of undue influence and favoritism concerned a DS Regional Security Officer (RSO) posted overseas, who, in 2011, allegedly engaged in sexual misconduct and harassment. DS commenced an internal investigation of those allegations in September 2011.

However, at the time the investigation began, the RSO already had a long history of similar misconduct allegations dating back 10 years at seven other posts where he worked. A 2006 DS investigation involving similar alleged misconduct led to the RSO’s suspension for 5 days.

OIG found that there was undue delay within the Department in adequately addressing the 2011 misconduct allegations and that the alleged incidents of similar misconduct prior to 2011 were not timely reported to appropriate Department officials.7 OIG also found that, notwithstanding the serious nature of the alleged misconduct, the Department never attempted to remove the RSO from Department work environments where the RSO could potentially harm other employees, an option available under the FAM.8 Notably, the DS agents investigating the 2011 allegations reported to DS management, in October 2011, that they had gathered “overwhelming evidence” of the RSO’s culpability.

The agents also encountered resistance from senior Department and DS managers as they continued to investigate the RSO’s suspected misconduct in 2011. OIG found that the managers in question had personal relationships with the RSO. For instance, the agents were directed to interview another DS manager who was a friend of the RSO, and who was the official responsible for selecting the agents’ work assignments. During the interview, the manager acted in a manner the agents believed was meant to intimidate them. OIG also found that Department and DS managers had described the agents’ investigation as a “witch hunt,” unfairly focused on the RSO. Even though OIG did not find evidence of actual retaliation against the investigating agents, OIG concluded that these circumstances, including the undue delay, created an appearance of undue influence and favoritism concerning DS’s investigation and the Department’s handling of the matter.

Ultimately, in November 2013, based on evidence collected by DS and the Department’s Office of Civil Rights, the Department commenced termination of employment proceedings against the RSO. The RSO’s employment in the Department did not end until mid-2014, approximately 3 years after DS initially learned of the 2011 allegations.

 

The State/OIG report cleared Clinton’s chief of staff, Cheryl Mills, for allegedly interceding in an investigation by the Diplomatic Security Service concerning a nominee to be U.S. Ambassador. The Assistant Secretary of State for Diplomatic Security incumbent referred to below had been snared in the Benghazi-fallout, and resigned in December 2012:

The third DS internal investigation in which OIG found an appearance of undue influence and favoritism involved the unauthorized release in mid-2012 of internal Department communications from 2008 concerning an individual who was nominated in early-2012 to serve as a U.S. Ambassador. (The nominee’s name was withdrawn following the unauthorized release.) DS commenced an internal investigation related to the unauthorized release of the internal communications. The then Chief of Staff and Counselor to the Secretary of State was alleged to have unduly influenced that investigation.

OIG found no evidence of any undue influence by the Chief of Staff/Counselor. However, OIG did find that the Assistant Secretary of State in charge of DS had delayed for 4 months, without adequate justification, DS’s interview of the nominee, and that delay brought the investigation to a temporary standstill. OIG concluded that the delay created the appearance of undue influence and favoritism. The case was ultimately closed in July 2013, after the nominee was interviewed and after DS conducted additional investigative work.

No Undue Influence or Favoritism in Four Cases 

OIG did not find evidence of perceived or actual undue influence or favoritism in four of the DS internal investigations reviewed, and, in two of those four, determined that no further discussion was warranted. However, two cases are discussed further in this review because OIG found one common issue in both cases that requires remedial action—the failure to promptly report alleged misconduct to the DS internal investigations unit for further review.

Three DS special agents allegedly solicited prostitutes in 2010 while serving on the security detail for the Secretary of State. Although managers on the security detail learned of some of the alleged misconduct at or near the time it occurred, they did not notify the DS internal investigations unit, which normally handles such matters. A DS internal investigations agent only learned about the three cases while conducting an unrelated investigation. As a result, no action was taken to investigate the misconduct allegations until October 2011, 18 months after the first alleged solicitation occurred. As a result of the investigation then conducted, the three agents were removed from the Secretary’s security detail, and their cases were referred for further disciplinary action. One agent subsequently resigned; the allegations against the other two agents were not sustained.9

A DS special agent who worked in a domestic field office allegedly falsified time and attendance records over a 17-month period between January 2011 and May 2012. DS management in the domestic field office knew about the allegations but did not promptly report them to the DS internal investigations unit. In May 2012, during the course of an unrelated investigation involving the DS special agent, the DS internal investigations unit learned of the allegations of false time and attendance reporting. An internal investigation was then commenced, and the DS special agent subsequently resigned. DS also referred the matter to the Department of Justice, which declined prosecution of the case.

One footnote:

In the SBU report provided to Congress and the Department, OIG noted that one agent subsequently resigned; the allegations against a second agent were not sustained; and the third agent had initiated a grievance proceeding, which was pending, challenging the discipline determination. However, after the SBU report was issued, the Department advised OIG that the third agent’s grievance proceeding was resolved with a finding by the Foreign Service Grievance Board not sustaining the charges.

One Review Ongoing 

The eighth DS internal investigation reviewed by OIG concerned the use of deadly force during three incidents that took place during counternarcotics operations in Honduras in 2012. OIG has commenced a joint review with the U.S. Department of Justice, Office of the Inspector General. The investigation remains under review, and OIG will issue a separate report on the matter.

The above case was cited in the USA Today report:

“The Diplomatic Security Service said William Brownfield, assistant secretary of State for the Bureau of International Narcotics and Law Enforcement Affairs, “gave the impression” that a probe of the shooting deaths of four Hondurans involving the Drug Enforcement Administration should not be pursued. The case remained open when the memo was written, as the DEA would not cooperate.”

OIG Recommendations – open and unresolved

  1. The Department should take steps (as previously recommended in OIG’s report on the 2012 inspection (ISP-I-13-18)), to enhance the integrity of DS’s internal investigations process by implementing safeguards to prevent the appearance of, or actual, undue influence and favoritism by Department officials.
  2. The Department should clarify and revise the Foreign Affairs Manual and should promulgate and implement additional protocols and procedures, in order to ensure that allegations of misconduct concerning Chiefs of Mission and other senior Department officials are handled fairly, consistently, and independently.

The end.

 

Related posts:

 

Related item:

-09/30/14   Review of Selected Internal Investigations Conducted by the Bureau of Diplomatic Security (ESP-14-01)  [685 Kb] Posted on October 16, 2014

 

 

 

 

 

 

$6 Billion Alert. What Does The Spox Say? Goring-ding-ding-ding … “Grossly Inaccurate” But ….

— Domani Spero

 

Last week, State/OIG issued a Management Alert on Contract File Management Deficiencies at the State Department. The Alert is reportedly intended to well, alert senior Department management to the serious nature of this issue and provides “recommendations to assist in eliminating or mitigating those vulnerabilities.” The main thing is this:

“In sum, over the past 6 years, our audit work has uncovered significant contract file management deficiencies in Department contracts/task orders with a total value of more than $6 billion.”

The alert dated March 20, 2014 was addressed to the Under Secretary for Management Patrick F. Kennedy and the Assistant Secretary of Administration Joyce A. Barr. The signatory of this Management Alert is not State/OIG Steve Linick but three of the four Assistant Inspector Generals of State/OIG namely: Norman P. Brown, Assistant Inspector General for AuditsRobert B. Peterson, Assistant Inspector General for Inspections;  Anna S. Gershman, Assistant Inspector General for Investigations.  Mr. Brown has been AIG since July 2013, Mr. Peterson since 2003, and Ms. Gershman since 2011.  The official response to this alert is dated March 28, 2014 from Ms. Barr who as head of the Bureau of Administration reports to Mr. Kennedy at “M.” Ms. Barr has been “A” since 2011.  Mr. Kennedy has been “M” since 2007.

Do you know why it took six years for this alert to be issued? And how is it that this alert is not addressed to the State Department’s Deputy Secretary for Management and Resources Heather Higginbottom?

Since $6 billion is a lot of resources spent, it made a huge splash — described as “lost,” “missing,” “misplaced,” “lacks files,” or “not totally sure” where the money went.

It made the Daily Press Briefing, of course:

QUESTION: Marie, do you have any comment on the OIG report that was made public today on the $6 billion?

MS. HARF: I do. Just give me one second. Well, reports that there is a $6 billion that can’t be accounted for are grossly inaccurate. The OIG’s report noted that there were a number of incomplete files for our contracts and that these contracts’ cumulative value was about 6 billion. As highlighted in our response to the OIG, this is an issue of which the Department is aware and is taking steps to remedy. It’s not an accounting issue. I think it’s more like a bureaucratic issue. But it’s not that we’ve lost $6 billion, basically.

On March 20th, our new Inspector General did issue a management alert on contract file management deficiencies. The Bureau of Administration responded with a plan to address their three recommendation. Those are all posted on the IG’s web page now.

QUESTION: So how much money can you not account for if it’s not 6 billion?

MS. HARF: I have no idea.
[…]
QUESTION: But it’s way less than 6 billion? I mean, you said it was grossly inflated.

MS. HARF: Grossly inaccurate. Uh-huh.

QUESTION: Okay. So do – you must have —

QUESTION: What’s a rounded-up figure —

MS. HARF: I’m not – no —

QUESTION: You must have an estimate of what it is if you have an understanding —

MS. HARF: It’s my understanding that it’s not an accounting issue. It’s not that we can’t account for money. So I don’t – I’m not sure that there’s any money that we can’t account for.

QUESTION: So how is it grossly inaccurate, then?

MS. HARF: Because it’s not that there’s $6 billion we can’t account for. They said there were incomplete files —

QUESTION: Right.

MS. HARF: — and that the files were – their cumulative value for those contracts was about $6 billion. So it’s a filing issue. It’s not a “we lost money” issue.

QUESTION: So you’re sure that you know where all that money is even though you acknowledge that the files are not complete?

MS. HARF: I – that’s my understanding, yes. But again, all of this is posted on the IG’s website in much more detail.

QUESTION: But —

MS. HARF: I don’t have the $6 billion.

QUESTION: Yeah. I mean, I just – (laughter) – it sounds like it may be more of a distinction without a difference, saying it’s an accounting error, like maybe —

MS. HARF: No, because the notion that we can’t find $6 billion, right, would mean that it’s an accounting issue, that somehow we lost money that – you can understand why when people hear that they think that it means we’ve lost $6 billion. That’s my understanding that that’s not the case.

QUESTION: Yes, please. I mean, regarding this IG issue, it’s like every other day something is coming out of —

MS. HARF: IG’s been very busy, apparently.

QUESTION: Yeah. I mean, because there was no IG before, no five years.

MS. HARF: We have a new IG, yep.

QUESTION: Yeah, it came on September. Yeah. I mean, I’m trying to figure out – I mean, when he’s like – when you say grossly and inaccurate, does he presenting these things with information or just like a number?

MS. HARF: Yeah. So the way the IG works in general – and I don’t have the details about their methodology here – is they are independent and they undertake independent reviews, some I understand that are done just routinely, some I think are in response to people submitting things to them. And in general, after the IG does a draft report they submit it to either the post overseas or the office here or the bureau that deals with it so they can have a chance to review it and comment on it and to begin implementing recommendations, if there are any that they think are helpful. So there’s a process here. Then they eventually release the final report that sometimes takes into account comments, sometimes they disagree. We have a variety of ways to respond.

QUESTION: The reason I am asking because these things are related more about overseas activities and contracts. Does the State Department officially – when you say grossly inaccurate, are you going to say what is accurate?

MS. HARF: Yes. And as I said, our response and the entire report is up on the IG’s website. I’m happy to dig into it a little bit more. But yes, we do. I mean, that’s why we give responses and they’re published.

A good excuse to post this again:

Below are some of the cases specified in the $6 billion State/OIG alert:

  • A recent OIG audit of the closeout process for contracts supporting the U.S. Mission in Iraq revealed that contracting officials were unable to provide 33 of 115 contract files requested in accordance with the audit sampling plan.  The value of the contracts in the 33 missing files totaled $2.1 billion.
  • Forty-eight of the 82 contract files received did not contain all of the documentation required by FAR 4.8. The value of the contracts in the 48 incomplete files totaled an additional $2.1 billion.
  • An ongoing OIG audit of Bureau of African Affairs contracts revealed that CORs were unable to provide complete contract administration files for any of the eight contracts that were reviewed. The value of these contracts totaled $34.8 million.
  • In two joint audits conducted with DoD OIG,5 we found that, for two task orders valued in excess of $1 billion, the Bureau of International Narcotics and Law Enforcement Affairs had neither ensured that the COR for the Civilian Police contract in Afghanistan established or maintained contracting files that were complete and easily accessible, nor finalized and fully implemented standard operating procedures for maintaining COR files.
  • A joint audit with SIGIR,  we reviewed four task orders from the Worldwide Personal Protective Services II contract, with an estimated total cost of $1 billion as of May 29, 2008, and found that COR files maintained in both Washington, DC, and Baghdad, Iraq, were not accessible, complete, or maintained in accordance with Department policy.
  • One investigation revealed that a contract file did not contain documentation reflecting that modifications and task orders were awarded to the company owned by the spouse of a contractor employee performing as a Contract Specialist for the contract. This contract was valued at $52 million.  (Note: We think this is the relevant case – Former State Department Contract Employee And Husband Plead Guilty To $53 Million Fraud)
  • In another investigation, OIG found that a CO falsified Government technical review information and provided the contractor with contract pricing information. The related contract file was not properly maintained and for a period of time was hidden by the CO. This contract was valued at $100 million.
  • In a third investigation, OIG found that a COR allowed the payment of $792, 782 to a contractor even though the contract file did not contain documents to support the payment. Furthermore, an additional OIG investigation revealed that the contract file was missing a COR appointment letter required by FAR 1.602-2 (d).
  • COR files for a $2.5 million contract lacked status reports and a tally of the funds expended and remaining on the contract. OIG discovered other instances in which contract files lacked contract performance documentation and COR appointment and training certification; CORs failed to maintain technical information and performance records needed to monitor contractor performance; and COR filing systems were disorganized.

 

The Management Alert issued concludes that “The failure to enforce those requirements exposes the Department to significant financial risk and makes OIG oversight more difficult. It creates conditions conducive to fraud, as corrupt individuals may attempt to conceal evidence of illicit behavior by omitting key documents from the contract file. It impairs the ability of the Department to take effective and timely action to protect its interests, and, in turn, those of taxpayers. Finally, it limits the ability of the Government to punish and deter criminal behavior.”

If these contract documents were never completed, what is there to file? If these were filed but misplaced, how do you find files that date back to 2008 for instance on the Worldwide Personal Protective Services II contract in Iraq? Also, without accurate files how do we even know that “It’s not a “we lost money” issue?” 

This is the second Management Alert issued by State/OIG under Steve Linick this year. We have not been able to locate previous management alerts issued by any of his predecessors as Inspector Generals of the State Department.  Perhaps they’re available, not just to the public. But this scrub down is smart.  Every new sheriff should do it. We’re also looking forward to the next alert. It’ll tell us where the new IG is looking under the hood.

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Related items:

-03/31/14   Management Alert – Contract File Management Deficiencies (MA-A-0002)  [1768 Kb]  Posted online April 3, 2014

-01/13/14   Mgmt Alert on OIG Findings of Significant and Recurring Weaknesses in the Dept of State Info System Security Program (MA-A-0001)  [6298 Kb]  Posted online January 16, 2014

 

 

 

 

 

 

 

 

 

 

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