"VA staff spent $2.6b on agency credit cards: Bills at casinos, posh retailers investigated"
By Hope Yen, Associated Press, April 7, 2008, The Boston Globe Online
WASHINGTON - Veterans Affairs employees last year racked up hundreds of thousands of dollars in government credit-card bills at casino and luxury hotels, movie theaters, and high-end retailers such as Sharper Image and Franklin Covey, and government auditors are investigating.
Through a Freedom of Information Act request, the Associated Press obtained the agency's list of 3.1 million purchases made in the 2007 budget year. The list provides a detailed look into staff spending at the government's second-largest agency.
The agency's employees charged $2.6 billion to their government credit cards last year. By and large, the list reveals few outward signs of questionable spending, with hundreds of purchases at prosthetic, orthopedic, and other medical supply stores.
But there are multiple charges that have caught the eye of government investigators.
At least 13 purchases totaling $8,471 were charged at Sharper Image, a specialty store that sells high-tech electronics and gizmos such as robotic dogs. In addition, 19 charges worth $1,999.56 were made at Franklin Covey, which sells leather totes and planners for corporate executives.
Government reports in 2004 said these two companies, by virtue of the types of products they market, would "more likely be selling unauthorized or personal-use items" to federal employees.
Many of the 14,000 Veterans Affairs employees with credit cards, who work at headquarters in Washington and at medical centers around the nation, also spent tens of thousands of dollars at Wyndham hotels in places such as San Diego, Orlando, Fla., and on the riverfront in Little Rock, Ark.
One-time charges ranged up to $8,000. On at least six occasions, employees based at the Veterans Affairs headquarters made credit card charges at Las Vegas casino hotels totaling $26,198.
Matt Smith, spokesman for the agency, said Veterans Affairs was reviewing these and other purchases as part of its routine oversight of employee spending. Many of the purchases at Sharper Image and other stores included clocks for low-vision veterans, humidifiers, air purifiers, alarm devices, and basic planner products, he said.
Smith said all the casino hotel expenditures in 2007 were for conferences and related expenses. He said the spending was justified because Las Vegas is a place where "VA is building a new medical center and an increasing number of veterans are calling home."
"The Department of Veterans Affairs, like many public and private groups, hosts conferences and meetings in Las Vegas due to the ease of participant travel, the capacity of the facilities, and the overall cost associated with hosting a conference," he said.
According to agency policy, purchase cards may be used at hotels to rent conference rooms or obtain audiovisual equipment or other items for meetings. They should not be used to reserve lodging.
Auditors long have urged Veterans Affairs to adopt policies to encourage use of free conference rooms. Auditors previously faulted the agency for booking rooms at expensive casino hotels without evidence it first had sought free space.
In the coming weeks, auditors at the Government Accountability Office and the Veterans Affairs inspector general's office are to issue reports on purchase card use and spending controls at the VA and other agencies. The reports are expected to show lingering problems at Veterans Affairs, which auditors cited in 2004 for lax spending controls that wasted up to $1.1 million.
"It's all being looked at," Belinda Finn, the agency's assistant inspector general for auditing, said in a telephone interview.
Congressional leaders said the expenditures were troubling.
Representative Harry Mitchell, chairman of the House Veterans' Affairs subcommittee on oversight, said he would question Veterans Affairs officials about the purchases at a hearing set for July. Mitchell, Democrat of Arizona, said he feared there may be "a growing culture of wasteful spending at the VA."
The list of charges provided to the AP gives the vendor, amount purchased, location, and employee name; in most cases it does not indicate the specific item purchased.
Requests by the AP for lists of the additional data in a timely manner were repeatedly declined on privacy and proprietary grounds.
"As vets await checks, VA workers get $24M bonuses"
By Kimberly Hefling, Associated Press Writer, Friday, August 21, 2009
WASHINGTON – Outside the Veterans Affairs Department, severely wounded veterans have faced financial hardship waiting for their first disability payment. Inside, money has been flowing in the form of $24 million in bonuses.
In scathing reports this week, the VA's inspector general said thousands of technology office employees at the VA received the bonuses over a two-year period, some under questionable circumstances. It also detailed abuses ranging from nepotism to an inappropriate relationship between two VA employees.
The inspector general accused one recently retired VA official of acting "as if she was given a blank checkbook" as awards and bonuses were distributed to employees of the Office of Information and Technology in 2007 and 2008. In some cases the justification for the bonuses was inadequate or questionable, the IG said.
The official, Jennifer S. Duncan, also engaged in nepotism and got $60,000 in bonuses herself, the IG said. In addition, managers improperly authorized college tuition payments for VA employees, some of whom were Duncan's family members and friends. That cost taxpayers nearly $140,000.
Separately, a technology office employee became involved in an "inappropriate personal relationship" with a high-level VA official. The technology office employee flew 22 times from Florida to Washington, where the VA official lived. That travel cost $37,000.
The details on the alleged improprieties were in two IG reports issued this week. VA spokeswoman Katie Roberts said the agency was extremely concerned about the IG's findings and would pursue a thorough review.
"VA does not condone misconduct by its employees and will take the appropriate correction action for those who violate VA policy," Roberts said in an e-mail to The Associated Press.
On Friday, Joe Davis, a spokesman for the Veterans of Foreign Wars, said if the allegations are found to be true, individuals involved should lose their jobs, and legal action should be taken.
"America's veterans served their nation honorably and with no expectations of reward," Davis said in an e-mail. "It should not be too much to ask for that same level of commitment from government employees, too."
And Sen. Richard Burr, R-N.C., the top Republican on the Senate Veterans' Affairs Committee, said Congress should investigate.
The number of claims the VA needs to process has escalated, and the Information and Technology Office has a critical role in improving the technological infrastructure to handle the increase. President Barack Obama has said creating a seamless transition for records between the Pentagon and the VA could help eliminate a backlog that has left some veterans waiting months for a disability check.
Much of the IG's focus was on Duncan, the former executive assistant to the ex-assistant secretary for information and technology, Robert Howard.
In one situation, a part-time intern with connections to Duncan was allowed to convert to a full-time paid position even though the individual was working a part-time schedule 500 miles away at college, the IG said.
"We have never known of any other new VA employee provided such favorable treatment," the IG said.
The individual's name and relationship to Duncan was blacked out, as were many other names in the reports.
Investigators recommended that the employees who received the college money pay it back. The largest amount awarded was $33,000.
In addition to Duncan, three other high-level employees received $73,000, $58,000 and $59,000 in bonuses in 2007 and 2008, the IG said. In 2007 alone, 4,700 employees were awarded bonuses, on average $2,500 each.
Some employees were given cash awards for services that were supposedly provided before the employees started working at VA, the IG said.
A man who answered the phone at Duncan's residence in Rehoboth Beach, Del., said she was not available, and he said not to call back.
The IG also found that Katherine Adair Martinez, deputy assistant secretary for information protection and risk management in the Office of Information and Technology, misused her position, abused her authority and engaged in prohibited personnel practices when she influenced a VA contractor and later VA subordinates to employ a friend.
The IG also said Martinez "took advantage of an inappropriate personal relationship" with Howard to transfer her job to Florida. In the nine months after she moved, the IG said Martinez traveled to Washington 22 times "to accomplish tasks that she could easily do from Florida."
The relationship between Martinez and Howard started in April 2007 and continued several months after Howard left the VA in January of this year, the IG said.
Roberts' e-mail did not address a request from the AP to speak with Martinez. Howard could not be immediately located for comment.
Indiana Rep. Steve Buyer, top Republican on the House Veterans' Affairs Committee, urged quick action to fix the problems. "VA must appoint honorable individuals to these critical positions," he said.
The VA has faced criticism before in its awarding of bonuses. In 2007, the AP reported that the then-VA secretary had approved a generous package of more than $3.8 million in bonus payments in 2006, citing a need to retain longtime VA executives.
On the Net:
Reports from VA Inspector General:
"Congress challenges bonuses at Veterans Affairs"
By Kimberly Hefling, Associated Press Writer, September 23, 2009
WASHINGTON --Lawmakers on Wednesday questioned whether millions of dollars in bonuses were appropriately awarded to employees at the Veterans Affairs Department.
The agency's inspector general recently found that over a two-year period, $24 million in bonuses were awarded to technology office employees at the VA, some under questionable circumstances. It also detailed abuses ranging from nepotism to an inappropriate relationship between two VA employees.
In a separate issue involving bonuses at the agency reviewed by the Veterans' Affairs House oversight subcommittee, executives within all department were awarded $4.3 million in performance bonuses in the last fiscal year -- some more than $60,000, said Rep. Harry Mitchell, D-Ariz., who chaired a subcommittee hearing on the issue.
The VA has nearly one million claims to process and has faced criticism in areas of quality control because of issues such as endoscopic procedure problems at three Southeast hospitals that potentially exposed thousands of veterans to infections. The problems make it even more relevant to review the awarding of bonuses, Mitchell said.
"The bonus system must allocate responsibility where it lies," Mitchell said.
Rep. Phil Roe, R-Tenn., questioned the sensitivity of the executive bonuses being distributed as the same time "we were shedding jobs like a dog shedding hair."
VA Deputy Secretary W. Scott Gould, who took office earlier this year under the Obama administration, said he agrees that it is a time to be sensitive about the nation's unemployment levels. He said that will likely be considered when the agency makes future performance awards. However, he said it is "also a time when we need to be encouraging our VA employees."
He said to the extent possible, multiple levels of review have been implemented to ensure bonus levels to executive level employees are appropriate.
Gould said the situation among technology office employees investigated by the IG was professionally disturbing and inexcusable and that actions were being taken to ensure something like that doesn't happen again.
James J. O'Neill, assistant inspector general for investigations with the VA's IG office, said he's confident the VA is thoroughly reviewing the matter and taking action.
On the Net: House Committee on Veterans' Affairs: http://veterans.house.gov/
- Jonathan Melle
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