That time when a real property lease in Iraq jumped from $124,000/mo to $665,000/mo

Posted: 2:25 am ET
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And no one noticed for about five months?

ALEXANDRIA, Va. – A former government contractor was sentenced today to four years in prison for his role in a government contract kickback scheme that caused a loss of more than $3.4 million to the U.S. Department of State.

According to court documents, Wesley Aaron Struble, 49, a U.S. citizen of Batangas, Philippines, engaged in a conspiracy to violate the Anti-Kickback Act in 2011 and 2012 while employed in Iraq as a government contractor. Initially employed by a business identified in court documents as Company B, Struble learned that another business, identified in court documents as Company A, was seeking a lease of real property for use related to a U.S. Department of State contract. Struble knew that Company B was paying approximately $124,000 per month to a third business, identified in court documents as Company C, for a lease of real property. According to court documents, Struble became a manager for Company A, and together with another manager for Company A, engaged in a conspiracy with associates of Company C to make the lease of property available to Company A at an inflated rate of $665,000 per month.

Court documents explained that Struble and the other manager of Company A influenced Company A to lease the property at the inflated rate and in return received at least $390,000 in cash kickback payments from associates of Company C. Struble then concealed cash in packages sent back to family members in the United States, including hiding cash inside stereo speakers. Struble also directed that cash be deposited in bank accounts in a manner designed to avoid detection. The U.S. Department of State, which ultimately paid the lease of real property between Company A and Company C, suffered a loss of approximately $3.4 million. In addition to Struble’s prison sentence, he was also ordered to pay approximately $3.4 million in restitution.

Two of Struble’s co-conspirators—Jose Rivera and Emil Popescu—were charged by indictment on March 30, for their roles in the conspiracy. According to court documents, Jose Rivera pleaded not guilty and is scheduled for a jury trial on August 7. The United States is seeking Emil Popescu’s extradition from Romania.

Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Steve A. Linick, the Inspector General for the U.S. Department of State; and Andrew W. Vale, Assistant Director of the FBI’s Washington Field Office, made the announcement after sentencing by U.S. District Judge Leonie M. Brinkema. Special Assistant U.S. Attorney Brian D. Harrison and Assistant U.S. Attorney Kimberly R. Pedersen prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:17-cr-44 and 1:17-cr-052.

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Hôtel Rothschild: The Ambassador’s Residence Built by a Child Bride With a Story Worthy of An Opera

Posted: 3:15 am ET
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The Hôtel Rothschild (also known as the Hôtel de Pontalba) the American Ambassador’s residence in Paris is one of the thirty-three properties in the Secretary of State’s Register of Culturally Significant Property. The Register founded in 2000 as a White House Millennium Project, is similar to the National Register of Historic Places that is maintained by the Secretary of the Interior for domestic U.S. properties. It is an honorific listing of important diplomatic overseas architecture and property that figure prominently in our country’s international heritage.  The residence was built by an American, Micaela Almonester Pontalba whose life is the subject of Thea Musgrave‘s 2003 opera, Pontalba: a Louisiana Legacy which is based on Christina Vella’s biography of Micaela, Intimate Enemies: The Two Worlds of the Baroness Pontalba.

hotel-rothschild-paris-france

Below via State/OBO:

No stronger tie between the U.S. and France exists than the U.S. Ambassador’s residence at No. 41 rue du Faubourg Saint-Honoré, built by an American, Micaela Almonester Pontalba, who was born in New Orleans in 1795. An arranged marriage for a merger of fortunes brought her to France at sixteen years of age. Separated in 1831, but loving Paris, she bought on this site in 1836 one of the most famous d’Aguesseau houses in the city. After a visit to New Orleans, the newly-divorced baroness returned to Paris in 1838, demolished the house, and commissioned the architect Visconti to design a new one for the site. In 1845 she returned to New Orleans, where she built two monumental blocks of houses surrounding the church her father, Don Andres Almonester y Roxas, had funded on the now famous Jackson Square. Her monogram “AP,” designed by her youngest son Gaston, is still prominent on the wrought iron balustrades of the city’s most celebrated landmarks.

Baroness Pontalba returned to Paris and built the residence between 1852 and 1855. In her quest for grandeur she bought the state­ ly home of the Havré family and installed its treasures in her new home. Among the most famous of these were the chinoiserie pan­ els in one room that became the talk of Paris. The nineteenth century facade is defined by the famous local buff limestone, a slate mansard roof with dormers, and œil de bœuf lunettes. Her former husband, who had suffered a physical and mental breakdown, was waiting for her when she returned from New Orleans and asked her to take over and manage his affairs, which she did until her death in 1874. According to the Baroness’ wishes, the residence passed to her sons to provide pensions for her grandchildren.

In 1876 the Pontalba sons sold the residence to Edmond de Rothschild, one of the brothers managing the famous Rothschild family banking empire. With architect Félix Langlais, the facade was remodeled, roofline raised, and wings extended. The basic original floor plan was maintained and remains today as the entry hall, along with three salons that were adjusted in size but still overlook an expansive garden, one of the largest in Paris. In the main salon, now known as the Samuel Bernard Salon, Rothschild installed intricately carved paneling from the Left Bank home of Jacques-Samuel Bernard.

In 1934 Maurice de Rothschild inherited the residence from his father Edmond, who had sent many of its valuable items to his son James, owner of the palatial Waddesdon Manor in England. World War II disrupted the elder Rothschild’s ambitious renovation projects for the residence. The family fled Paris as the Nazis moved in, and Hermann Göring used the mansion for his Luftwaffe
offi­cers’ club. The residence was never again to be a strictly private home. After the war, the Allies rented it for three years, and in 1948 the United States purchased No. 41 for the U.S Information Services, USIS. The residence became one of the buildings occupied by individuals working on the Marshall Plan as Averell Harriman began this important endeavor. Prior to this purchase many of the valuable panels in the rooms and other architectural elements had been removed by Maurice Rothschild.

And here you go, the chief of mission residence (CMR) dressed up during various occasions:

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Snapshot: State Dept Overseas Real Property Acquisitions & Disposals (FY2008-2013)

— Domani Spero
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 Via GAO

Our analysis of State’s real property portfolio indicated that the overall inventory has increased. State reported its leased properties, which make up approximately 75 percent of the inventory, increased from approximately 12,000 to 14,000 between 2008 and 2013. However, comparing the total number of owned properties between years can be misleading because State’s method of counting these properties has been evolving over the past several years. OBO officials explained that in response to changes in OMB’s and FRPP’s reporting guidance, they have made efforts to count properties more precisely. For example, OBO has focused on separately capturing structural assets previously recorded as part of another building asset, such as perimeter walls, guard booths, and other ancillary structures. As a result of this effort, State recorded approximately 650 additional structural assets in its fiscal year 2012 FRPP report and approximately 900 more structures the following year in its fiscal year 2013 FRPP report, according to OBO officials.

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Acquisitions: State reported spending more than $600 million to acquire nearly 300 properties from fiscal year 2008 through 2013 (see fig.1).11 State uses two sources of funding to acquire real property. It acquires land for building new embassy compounds (NEC) with funding from the CSCS program. It acquires residences, offices, and other functional facilities with proceeds from the disposal of unneeded property. In fiscal years 2008 through 2013, State reported spending approximately $400 million of these disposal proceeds to acquire approximately 230 properties.

Disposals: From fiscal years 2008 through 2013, State reported selling approximately 170 properties. In doing so, it received approximately $695 million in proceeds (see fig.1). According to State, property vacated when personnel move into newly constructed facilities is the largest source of property that can be disposed of. When State completes construction of a NEC, personnel previously working in different facilities at multiple locations are then collocated into the same NEC, a move that provides State an opportunity to dispose of its former facilities. Further information on State’s acquisitions and disposals from fiscal year 2008 through 2013, can be found in figures 1 and 2 below.

Leases: The majority of State’s leased properties are residences. State reported spending approximately $500 million on leases in 2013 and projects a potential increase to approximately $550 million by 2016 as growing populations in urban centers around the world push rental costs higher and the U.S. government’s overseas presence increases.

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