Friday, September 26, 2003

Whistleblowers and the DoD

It appears that the hiring of L. Jean Lewis is not the only time the Department of Defense's Office of the Inspector General has engaged in behavior that raises questions about its ethics.

As I noted previously, Lewis' hiring -- elevating a low-level investigator to a high-level staff-oversight position -- raises serious doubts about the judgment of the IG, Joseph H. Schmitz, and casts some of his bureaucratic moves in a more ominous light, considering that his office is responsible for auditing the billions of dollars' worth of private contracts that the DoD is relying upon in rebuilding Iraq. This is especially cause for concern, since Halliburton -- a corporation with extensive ties to the Bush administration -- is at the forefront of these contractors.

Worthy of particular attention, it appears, is Schmitz's "reorganization" of his department. Shortly after taking office in April 2002, Schmitz hired a team of outside "consultants" to conduct a review of the Inspector General's Office. This "assessment team" was provided by Military Professional Resources Inc. of Alexandria, Va., a "private military" organization that provides training and other services to militaries around the world. According to CitizenWorks:
MPRI reported annual sales of $95 million from numerous contracts with the U.S. and foreign governments to provide military training and consulting, according to the Center for Public Integrity. MPRI, which boasts of having "more generals per square foot than in the Pentagon," has trained local forces in Croatia that went on to conduct one of the worst episodes of "ethnic cleansing" in an event that left more than 150,000 ethnic Serbs homeless and hundreds dead, according the Center for Public Integrity.

(You can read the core data compiled by CPI on Military Professional Resources' activities here.)

In any event, the report provided by the MPRI team was, according Defense Week, "highly critical of IG leaders, though it was short on specific examples of their alleged failures." Indeed, employees at the IG's office reportedly widely felt that the "assessment team" had arrived with the conclusions it wanted to reach ahead of time, and set about finding "facts" to support them.

Into this mix fell the Alan White matter.

White was director of Investigative Operations at the Defense Criminal Investigative Service Headquarters, the DCIS being one of the DoD IG's office main bureaus, until July 2002.

White was also closely associated with Sen. Charles Grassley, the Iowa Republican who chairs the Senate Finance Committee. Grassley has been one of the sharpest critics of the DoD IG's office in recent years, and White appeared several times as a witness in support of Grassley's positions in committee hearings, and he reportedly has been a major source for Grassley.

Was the IG's office performing as terribly as Grassley often proclaimed? It's difficult to say for certain. In at least one instance, he uncovered a case in which a dozen or so of the auditors in the IG's office were reportedly involved in doctoring working papers in order to bolster their scores in a performance review.

In other regards, it is clear the office was doing excellent work in uncovering fraudulent military contracts. In March of 2001, it had released a report that found the following examples of gross overcharges in the Pentagon's accounting system:
-- The Pentagon paid $2.10 for a body screw that cost the vendor 48 cents, a 335 percent mark-up.

-- The Pentagon paid 25 cents for a dust protection plug that cost the vendor 3 cents, a 699 percent mark-up

-- The Department paid $409.15 for a washroom sink that cost the vendor $39.17, a 945 percent mark-up.

At the time, Grassley denounced the waste:
"The Pentagon does not know how much it spends. It does not know if it gets what it orders in goods and services. And the Pentagon, additionally, does not have a handle on its inventory. If the Pentagon does not know what it owns and spends, then how does the Pentagon know if it needs more money? . . . Ramping up the Pentagon budget when the books are a mess is highly questionable at best. To some it might seem crazy."

But a few months later, he was busy blaming the Inspector General's office for the problem. Indeed, Grassley devoted a great deal of time during Schmitz's nomination hearings demanding that the next IG address "serious leadership and morale problems in that office" and otherwise "clean house."

In the spring of 2002, while still working for the IG's office, Alan White decided to run for the school board in Fairfax, Va., where he lived. He told his bosses he was running for a non-partisan position, but in fact White ran as a Republican, obtaining in the process both financial contributions and services while running, both of which are in direct violation of the Hatch Act, which bars senior federal employees from such activities.

In July of 2002 -- just as White was leaving the DoD for a new assignment at the United Nations -- the Office of Special Counsel announced it was filing a petition for disciplinary action against White for his Hatch Act violations. The OSC, apparently, had been tipped off to White's illegal actions by an anonymous hotline caller.

The DoD Inspector General's Office had also received such a tip. Three top IG investigators -- Carol Levy, assistant IG for investigations and director of the DCIS; Tom Bonnar, Levy’s deputy; and Joel Leson, the IG’s director of administration and information management -- began looking into the matter in early July of 2002.

They did not, apparently, inform Schmitz about the information they had received. Instead, Schmitz apparently received a call from Grassley inquiring about whether retaliation against White was in the works. Within days, two other investigators -- both from Schmitz's Departmental Inquiries office -- descended on the DCIS investigators and began interrogating them about what they knew about the case. They were reportedly asked: "Were you the anonymous source of the initial allegations to the OSC and the DOD Hotline about Alan White's school board candidacy?" and whether any of them had exacted reprisal against White for disclosures he "allegedly previously made to Sen. Charles Grassley." They were also asked about whether they had made any contact with the OSC.

Not only had the interrogators attempted to determine if their own colleagues were the anonymous hotline informants, but, according to a complaint the three later filed, the two investigators had attempted to determine the identity of an anonymous hotline tipster in a separate case. Violating that anonymity, of course, would constitute a gross breach of the federal rules intended to protect federal whistleblowers, and if Schmitz indeed attempted to obtain such information, it raises grave questions about the standards of ethics being applied under his tenure.

If any of this sounds familiar, it should. It brings immediately to mind another notable case in which a supposed Republican "whistleblower" used her "investigations" as an excuse for a panoply of illegal activity and then claimed she was facing "retaliation" when those activities came to light.

In August, the three veteran investigators were given a rude greeting at their longtime workplace: They were removed from their offices, forced to relinquish their guns, badges, credentials, pagers, and cell phones, and their computers were seized. Schmitz distributed their photos to security guards with orders to keep them from the premises.

A month later, their lawyers filed a complaint with the President’s Council on Integrity and Efficiency, which is the watchdog of the federal IG community, and another with the Office of Special Counsel. The complaints alleged that the IG's office had retaliated against them for their investigation of White. According to William Bransford, their lawyer, Schmitz may have been "improperly politicized" in handling the matter. "There's an appearance of reprisal, of improper legislative political influence, and of arbitrary and capricious treatment of a senior executive, which is illegal," Bransford said.

The matter finally hit the press when John M. Donnelly of Defense Week began reporting on the complaint. His September 23 report, "IG Under fire for Treatment of Execs" (available here from the Google cache), covered most of the essentials of the case. He followed up with another report in the Oct. 7, 2002, edition, titled "IG, Senior Execs Battle Over Alleged 'Purge' ". (I must point out here that the bulk of this report originates from Donnelly's reportage, which is first-rate; I managed, moreover, to corroborate nearly everything in his pieces through secondary sources, some of which are linked here. Defense Week is only available online to subscribers, and its material is copyrighted.)

Significantly, Donnelly interviewed some 12 veteran employees in the IG's office who told him the purge had created "confusion and fear" and extremely low morale. Donnelly also quoted Robert Lieberman, Schmitz's immediate predecessor:
"The way in which those three senior executives have been treated is simply uncalled for. The kinds of changes he [Schmitz] is making and the methods he's using, in my mind, go far beyond anything that is constructive or appropriate. I fear for the future of the organization."

As it happened, the removal of the "Arlington Three" (as they came to be known) coincided with Schmitz's announcement of the results of his reorganization plan. And as it also happened, one of the departments most significantly affected by the reorg was the DCIS. Carol Levy's dual positions were broken into two offices, with the DCIS chief now reporting to the Assistant IG for Investigations.

Also noteworthy were the changes that Schmitz introduced to the auditing system. Under the old system, possible crimes that were uncovered by auditors were reported to various agencies under a variety of means. As Donnelly reported in his Sept. 23 sidebar, "Inspector General Reorganizes Watchdog Organization":
The IG act requires that the IG promptly notify the Attorney General when he has reason to believe violation of federal criminal law.

Up to now, Schmitz said, the criminal investigators within the IG were doing that "apparently pretty well on a case-by-case basis with the local U.S. attorneys." But the IG's auditors and internal, non-criminal investigators had their own ways of reporting possible crimes, he said. Under the IG statute, the IG is supposed to notify the Attorney General. Schmitz said he doesn't intend to micromanage the process, just to think through more clearly how it's done via a "single implementing regulation."

Actually, what it sounds like Schmitz is proposing is that all crimes uncovered by auditors be channeled through a single controlling function within the IG's office, rather than under the fairly open system that existed previously. It may have the advantage of organizing the audits' reporting; but it may also close the audit system down and squelch the uncovering of abuses. This becomes significant when one considers that auditors are those most likely to uncover irregularities in such dealings as those now being underwritten in Iraq.

In the mid-October followup report, Donnelly also reported that Schmitz explained the "detailing" of the three senior investigators, claiming that the action was not "punitive or adverse," even though it plainly was. He claimed they had been removed because they has withheld "important information involving an ... ongoing criminal investigation" -- even though, as the trio's lawyer pointed out, such delays in relaying information are regular occurrences.

Leson, it turned out, had been singled out for removal because he reportedly had made disparaging remarks about both Schmitz and his "assessment team." As Donnelly reported:
The lawyers denied several aspects of the IG's memo to Leson, but they confirmed that Leson had expressed concerns that the assessment team seemed to be seeking only negative information about the IG office and had "determined its conclusions" prior to investigating. Many officials in the IG's office hold that view.

That same assessment team, it turned out, had made a pre-emptive strike in the direction of the Office of Special Counsel. As Donnelly reported in another Oct. 15 piece, "Special Counsel, Hit In IG-Sponsored Report, Hits Back," the report had gone out of its way to belittle the OSC's work, charging that the office's work in protecting whistleblowers had become "increasingly discredited." As Elaine Kaplan wrote in a letter to Schmitz:
"I am unaware of the basis for the report's negative comments about OSC. … We were not consulted by the team that prepared the report, and there is no source provided for the opinion. More to the point, the view of OSC's effectiveness expressed in the report is an outdated one that is not shared by knowledgeable observers and practitioners. It would be unfortunate indeed if the very whistleblowers the report suggests should be protected and encouraged gave any credence to this erroneous assertion that OSC will not effectively protect them."

One can only imagine, of course, what would have happened had a top official of a Clinton or Gore administration participated in such hamhanded antics (remember Travelgate?). The story, however, never gained any attention in the mainstream press. And Schmitz's apparent misbehavior has in the intervening months fallen into the memory hole.

Donnelly did file a brief followup piece in the June 23, 2003 Defense Week which reported that Levy, Bonnar and Leson had all managed to settle into other work. Levy chose to work on projects from her home, Bonnar found a criminology teaching post at the University of Maryland, and Leson went to work for the International Association of Police Chiefs.

Their complaint to the OSC, Donnelly reported, had been dropped.

Thus it has never been officially resolved, one way or another, whether or not Schmitz attempted to obtain the identity of anonymous whistleblowers, or whether the removal of the "Arlington Three" was in retaliation for their investigation of Alan White.

But it must also be noted that if anyone was likely to view a "whistleblower" caught using their political connections to advance their careers, it certainly would be the IG's new chief of staff.

Still unanswered, of course, is whether or not the dismissal of the "Arlington Three" just happened to coincide with the arrival of L. Jean Lewis in the IG's office. (According to the Newsweek report, she was hired sometime "last year.")

As for Al White? Well, according to Stephen Barr of the Washington Post, Republican Rep. Thomas Davis of Virginia snuck into the fiscal 2004 defense-appropriations bill a rider that would stop the prosecution of White:
[OSC chief Elaine] Kaplan, in a letter to lawmakers before her term in office ended, called the provision "ill-advised" and said "the use of the legislative process to interfere with a specific matter in litigation sets a poor example that may undermine our ability to effectively enforce the Hatch Act."

Asked about Kaplan's criticism, David Marin, a spokesman for Davis, said: "There are larger issues here. Congress never intended the Hatch Act to be enforced against people who are not current members of the federal service. . . . Apparently the Office of Special Counsel thinks it has the authority to pursue people after they have left office."

As a reader suggested a week later in an online chat with Barr:
This seems to be an abuse of legislative power to circumvent the checks and balances that make our government as ethical as possible. It also appears that Tom Davis must owe Mr. White a favor and that he is championing this bill. Through bartering, it appears that what was originally a proposed change to the Hatch Act, it applies to just Al White.

I'll be digging further and letting you all know the results.

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