WhistleblowerSupporter

Support Your Local “Occupy Your Town/City” Movement

I received an email today from someone who did not understand why I was not actively supporting the “Occupy” efforts across the country.  I’ve been watching news of these activities with interest. (The real news, not corporate owned media outlets who are NOT reporting it for the most part, and not accurately reporting it for the rest.)   A week or so ago I intended to go down and find out for myself what was going on, but work and several family disasters delayed my expedition down there.  Probably the same excuse, many of you have for not actively helping in some way or another.  

 

When you consider that the Occupy efforts appear to be a collaboration of committed individuals who have various concerns and complaints, many of which are caused by corporations, politicians, bureaucracy, greedy examples of those with more than most, etc.  The problems are social, economic, and political.  I can see my reader’s point

 

These are the same people who are helping to enable corporations and various hands and arms of government that are causing the very situations that are creating whistleblowers.  Greed, power mongering, cronyism, influence pedaling, unethical and criminal contracting activities, fraud, waste, abuse, and a host of other ills are examples.  Honorable people when confronted by this try to change it, report it, fix it and usually get the stuffing kicked out of them for their efforts in the climate we are dealing with in this country today. 

 

I agree that I should help promote the support of those who have the courage, determination and commitment to go be an active part of peaceful protest in events being staged across the nation.  Even if you cannot take part in the sign holding and waving, stop by and talk, find out why these people are down there and what they need to stay well and comfortable.  This is especially true in parts of the country that are now turning cold, wet and inhospitable.  My reader suggested donating supplies that are so critically needed like, warm coats, gloves, hats, food, especially things that can be cooked or heated under outdoor camping conditions.  Waterproof plastic storage boxes, tents, sleeping bags, cooking utensils, first aid supplies, those hand warmer sticks you can buy at sporting goods stores, and anything else that will keep up the volunteer’s spirits and energy.  

 

My reader reported that the Occupy Tacoma (in Washington State, south of Seattle, in a park on Pacific Avenue, downtown, at the cross street with the new bridge across the Puyallup River) is a neat and orderly effort showing a positively motivated cooperative of young and old that demonstrates a stellar example of the best of human effort.  They, who are giving the best they can to make a difference and to help the majority of us break out of our complacency and paralyzed condition, deserve our support and help. 

 

When those  with wealth and political control,  who continue to take and take and manipulate things to the detriment of the majority (working class and poor)  in this country are taken to task, and our society balances and rights itself again, we will also be reducing the number of whistleblowers, because there will be less crap and corruption to report,  and to fight against in our work places. 

 

Please take time this week or weekend and do what you can for your local “Occupy ____________” effort.  If you can report on your local Occupy activities, please comment here on this site; you are welcome to voice your observations and opinions. 

 

As for me, I am going to the coat closet, storage room and pantry right now! 

GFS

 

 

DSS Director Ignores DoD OIG Report and Recommendations: Why?

I hear through my sources that the DoD OIG completed a Title V investigation (Reprisal Office) and issued a report of findings in support of the federal employee whistleblower.  I have obtained a copy of this report from my sources in the DC area.  I am wading through it as we speak.  It would appear that Stanley Sims, DSS Director and Jay Freaude, DSS Counsel are purposefully refusing to acknowledge receipt of this report and responsibility to take constructive action to make the damaged employee whole, as directed by the DoD OIG. 

Is this how it will work?  Defense Security Service Director, Legal Department and Management will ignore investigative reports and pretend the investigation from DoD OIG simply does not exist and continue on their unethical and illegal path with impunity?  There are some very angry federal employees and civilian citizens regarding this cavalier attitude toward justice.  Not to mention questions about what appears to be DSS malfeasance in managing a federal agency and expenditure of taxpayer funds. 

If Defense Security Service oversight cannot be ethical in its own in-house matters, how can they be trusted to be ethical in doing their oversight job of policing government defense contracting and contractor corporations?

Anybody have more information or perspective? 

GFS

ATTENTION! SEC ADOPTS NEW WHISTLEBLOWER RULES

I attended one of these sessions recently.  You do not have to be an attorney to attend.  I recommend that you all attend and read Mr. Kohn's new book.  It is written to make the complexities understandable even for people who are not attorney's.    Your fee includes a copy of Mr. Kohn's new book and handouts.  He was very open to answering participant questions.  GFS

 

 *******

 

On May 25th, the Securities and Exchange Commission (SEC) adopted whistleblower rules that fundamentally changed and enhanced the right of employees to obtain legal protection and large financial rewards (see Washington Post article).  The National Whistleblowers Center and its legal staff were extensively involved in this process, providing the SEC with nine formal rulemaking submissions and personally meeting one-on-one with each of the five SEC commissioners.  Many of the NWC's proposals were adopted by the SEC, and the Final Rules cited to NWC formal comments forty-four times.  The new regulations will prove an invaluable asset in the representation of corporate whistleblowers, and the new regulations if properly utilized will prove to be an invaluable asset in successfully representing employees and preventing corporate fraud.

 

As a result, the National Whistleblowers Center is conducting a series of nationwide seminars that will focus on the new SEC regulations, and the historic whistleblower protections contained in the Dodd-Frank Wall Street Reform and Consumer Protection Act.  The seminars will explain the new anti-retaliation rules governing corporate employees and the financial reward provisions.  These rules require the SEC to pay large financial awards to qualified whistleblowers for which there is no cap and can result in multiple millions of dollars in recoveries.

 

 

 

 

Dodd-Frank Act

3-hour CLE Seminar

NEW Corporate Whistleblower Protections and Reward Provisions

 

 

On July 21, 2010, Congress enacted the Dodd-Frank Act. Corporate whistleblowing was forever changed. The Act established the right of whistleblowers to obtain multi-million dollar rewards for reporting violations of Securities and Commodities Exchange Acts. These "qui tam" provisions were modeled on the False Claims Act -- a law that already has resulted in whistleblowers obtaining over $2.7 billion dollars in rewards for reporting federal contracting and procurement violations to the Justice Department. Dodd-Frank also enhanced employment protections available to whistleblowers. Retaliatory discharge cases can now be filed directly in federal court, with the right to a jury trial. Under Dodd-Frank, mandatory arbitration agreements cannot be enforced.

$150 ATTORNEY REFERRAL SERVICE MEMBERS

($95 For Early Bird Special!)

 

$295 ATTORNEYS

($150 For Early Bird Special!)

 

$75 WHISTLEBLOWERS

 

Call (202) 342-1903 for Early Sign-up or ARS Discount Codes

 

To REGISTER visit our UPCOMING EVENTS page

Locations:

 

Washington, DC -- June 10th, 2011 (Teleconference Available)

         National Whistleblowers Center

         3238 P Street NW

         Washington, DC 20007

 

         Register on or before June 7th for Early Bird Special

 

         Contact Seminar Director Estelle Kohn at ek@whistleblowers.org or Associate

         Seminar Director Philip Barrett at whistle@whistleblowers.org or call

         (202) 342-1903 to register

 

Denver, CO -- June 23rd, 2011

         The Browne Palace Hotel & Spa

         321 17th Street

         Denver, CO 80202

 

         Register on or before June 10th for Early Bird Special

 

San Francisco, CA -- June 27th, 2011

         TURN-The Utility Reform Network

         115 Sansome Street, Suite 900

         San Francisco, CA 94104

 

         Register on or before June 10th for Early Bird Special

 

Los Angeles, CA -- June 28th, 2011

         Carlsmith Ball LLP

         444 South Flower Street, 9th Floor

         Los Angeles, CA 90071-2901

 

         Register on or before June 10th for Early Bird Special

 

New York, NY -- July 25th, 2011

         New York Marriott Downtown

         85 West Street at Albany Street

         New York, NY 10006

 

         Register on or before July 15th for Early Bird Special

 

CURRICULUM:

Learn how to use the new corporate whistleblower laws and regulations to effectively represent employees, combat fraud and qualify for large whistleblower rewards. Gain insight into how whistleblower protections laws can be integrated into your law practice as powerful legal tools for maximizing your client's ability to have their case heard before a jury and obtain entitlement to large monetary damage awards and rewards.

 

FACULTY:

Stephen M. Kohn, Esq. is the Executive Director of the National Whistleblowers Center and one of the nations leading advocates on whistleblower law.  Mr. Kohn will present this unique seminar on the latest whistleblower laws and rewards provisions. Mr. Kohn has represented numerous high profile whistleblowers for over 27 years. He has authored seven books on whistleblower law, including the recently published The Whistleblower's Handbook: A Step-by-Step Guide to Doing What's Right and Protecting Yourself (Lyons Press, 2011). Mr. Kohn was the principal author of the NWC's rulemaking petitions and personally met with all five SEC Commissioners and the responsible Commission staff.

 

To Register or For More Information:

Please visit our UPCOMING EVENTS page or contact Estelle Kohn or Philip Barrett by phone: (202) 342-1903 or email: ek@whistleblowers.org or whistle@whistleblowers.org.  

If you cannot make the seminar, you can purchase the course materials, The Whistleblower's Handbook, online for $16.95 plus shipping. 

Failing Inspector Generals Do Not Go Unnoticed

This was sent in today by a reader.  Thank you Old Navy Man, again.  -GFS

 

G. Florence

Federal government agency officials are going to do everything they can to ensure that these Inspector General reports are marginalized, or that they never come to the attention of the taxpaying public.  More times than not, these cases involve the misconduct of federal officials, acts of retaliation against whistleblowers trying to do the right thing, and the fraud and the waste and the abuse of taxpayer dollars.  Cover up and minimization of Inspector General investigations within the Department of Defense is rampant.  But don’t take my word for it, check the case statistics! 

An Old Navy Man

 

Watch Blog

POGO: The Case of the Missing Inspector General Reports

Posted at 10:28 am, November 4th, 2010

By Michael Smallberg,  (cross-posted with the Project On Government Oversight)

Inspector General (IG) investigations expose some of the most egregious examples of misconduct by federal officials—everything from whistleblower retaliation to the abuse of taxpayer dollars—and the public has every right to see the (non-classified, non-redacted) results of these investigations. Yet in many cases, agencies have been known to over-redact, delay, or completely block the release of IG investigative reports. As we discussed in our 2008 report on IG independence, restricting public access to these reports undermines the important work performed by IGs, and creates a significant barrier to holding agency officials accountable.

A few weeks ago, Senators Charles Grassley (R-IA) and Tom Coburn (R-OK) released letters from 13 IGs describing how their agencies have interfered with investigations. Among other things, the senators asked the IGs to provide “biannual reports on all closed investigations, evaluations, and audits conducted by your office that were not disclosed to the public.”

As the senators continue their review, we hope they take a close look at the Securities and Exchange Commission (SEC), which has a troubling history of withholding records from the public, including investigative reports issued by the IG.

On the SEC IG’s website, you won’t find any investigative reports issued prior to 2009, and there are only eight reports posted since then. Yet the IG’s semiannual reports to Congress describe dozens of investigative reports that have been issued to SEC management over the past two years.

To be fair, most of the SEC IG’s audit and evaluation reports dating back to 1994 have been posted online. But when it comes to investigative reports—in which the OIG’s Office of Investigations looks into “allegations of violations of statutes, rules and regulations, and other misconduct by Commission staff and contractors—very few have ever been released to the public.

After reviewing the IG’s semiannual reports, we’ve counted at least 27 investigative reports issued since 2009 that have not been posted online. These reports cover everything from insider trading by SEC employees to botched investigations of fraudulent companies. There are at least two reports—one on the SEC’s bungled investigation of Allied Capital, and one on allegations of whistleblower retaliation at the SEC’s Ft. Worth Regional Office—that have been redacted and released, but are nowhere to be found on the SEC or IG’s websites.

Even when the IG’s reports are released to the public, the SEC can still diminish their impact. In the case of the Allied report, for example, the SEC redacted the name of the official who became a registered lobbyist for Allied after he left the SEC and illegally attempted to access hedge fund manager David Einhorn’s telephone records, even though his name had already been disclosed in Einhorn’s book and various media reports.*

The SEC also has a troubling history of releasing IG reports on slow news days. As reported by the AP, the IG identified this problem in its latest report on the timing of the SEC’s charges filed against Goldman Sachs (the IG was investigating whether the timing was politically motivated or intended to overshadow the release of another IG report on the SEC’s botched investigation of the Stanford Ponzi scheme):

[SEC Office of General Counsel Attorney] sent an email to a personal friend on the day that the Goldman action was announced and the OIG Stanford Report was released, stating about these two matters, “What a coincidence that those two stories came out today. ”

…These suspicions were likely fueled by the recent history of the SEC releasing OIG reports that criticized the agency on “slow” news days… The SEC released the OIG’s 457-page Report of Investigation (“ROI”) concerning the failure of the SEC to uncover Bernard Madoff’s Ponzi Scheme after 5:00 p.m. on September 4, 2009, the Friday before a three-day holiday weekend….The SEC then released the hundreds of exhibits supporting the OIG’s ROI concerning Madoff late on Friday, October 30, 2009.

…In addition, the OIG ROI concerning the SEC’s failure to vigorously pursue Enforcement action against W. Holding Company, Inc., and Bear Sterns & Co., Inc., was made public on Friday, October 10, 2008….Consistent with this pattern, on the same Friday that the OIG Stanford Report was publicly released and the Goldman action was announced, April 16, 2010, the SEC also publicly released the OIG’s ROI concerning the SEC’s failure to timely investigate allegations of financial fraud at Metromedia International Group, Inc., which had been submitted to the SEC by the OIG almost two months earlier.

As the report suggests, it’s the agency—specifically, the Office of General Counsel—that’s in charge of redacting IG investigative reports, and the reports can only be released through a vote by the SEC commissioners. The IG elaborated on this issue at a September hearing before the Senate Banking Committee, stating that his office does not have the authority to make decisions on nonpublic information by itself, even though it has asked for such authority.

In recent testimony before the House Financial Services Committee, POGO’s Angela Canterbury recommended that “[d]eterminations of FOIA exemption applicability to OIG reports, particularly regarding investigations, should be independently reviewed by the FOIA office or a FOIA officer within the OIG, not by the Chair or OGC.”

We’re hopeful that the next Congress will be receptive to strengthening IG offices across the government.

– Michael Smallberg

 http://blog.niemanwatchdog.org/?p=1737

Decision Making Advice from Gandhi

Some quotes from Benjamin F. Schafer, sent in to Whistleblower 411 (Yahoo)   Thank you!  -GFS

 

The idea of the four groups nuance a subcategory of humanity, some people rise above and are outside these four groups. Below are examples of two people that I believe meet this criteria.

-Benjamin F. Schafer

 

“All mankind is divided into three classes: those that are immovable, those that are movable, and those that move. “

Benjamin Franklin

 

 

"I will give you a talisman. Whenever you are in doubt, or when the self becomes too much with you, apply the following test. Recall the face of the poorest and the weakest man [woman] whom you may have seen, and ask yourself, if the step you contemplate is going to be of any use to him [her]. Will he [she] gain anything by it? Will it restore him [her] to a control over his [her] own life and destiny? In other words, will it lead to swaraj [freedom] for the hungry and spiritually starving millions?

Then you will find your doubts and your self melt away."

- One of the last notes left behind by Gandhi in 1948, expressing his deepest social thought.

 

Comments Regarding “Declining DCAA Role in Oversight of Tens of Billions of Pentagon Contract Dollars

Here are some comments left on one of the articles I posted earlier today.  You will want to check the original article and additional comments.  See link at bottom of this post.  And thanks again, Old Navy Man.  GFS

 

G. Florence-

 

It’s not just ‘An Old Navy Man’ that believes there’s a problem.  See comments below.

 

Good investigative reporting on the part of Mr. Schwellenbach!

 

An Old Navy Man

 

 

TrackBack

Listed below are links to weblogs that reference Declining DCAA Role in Oversight of Tens of Billions of Pentagon Contract Dollars:

Comments

Joe   It is a shame that the only reason that DCAA gave away proposal audits under the stated PGI threshold is so that we can put more time in working paper documentation. Not that our audits will be any better or that we will question more cost. No, just the opposite. We gave away millions of dollars of proposal work just to have more time to document our work. Such as waste of effort. This is definately contrary to Secretary Gates efficiency initiative. I am dispoointed that Fitzgerald did not have a backbone and went along with AT&L on this one. Stephenson never would have given away work just to have more time for those picture perfect working papers. What's next, $500 million and $50 million. Before we know it, Fitzgerald will have each auditor completing only one audit per year. I imagine that Policy is already examining how to raise the desk review incurred cost threshold to $100 million per year. Here's a clue how to deal with the gap between the audit work that needs to be accomplished and the current funding, provide DCAA more funds. Simple, issue solved. DCAA saves dollar for dollar more than it costs, period. So why won't Comptroller Hale provide DCAA more money? Oh I get it, he does not want oversight of contractors and neither does our lobbyist Deputy Secretary of Defense. I get it now. We need a change of administration and fast!

Posted on: Oct 30, 2010 at 05:54 PM

Carol   The blog comments are 100% on the mark. In essence, pricing evaluations by DCMA for FFP under $10 million and cost type over $100 million will become nothing more than a rate check. DCMA is not staffed to perform a full price analysis of proposals under these thresholds. This represents a high volume of proposals. Rather DCMA will call DCAA for the latest rates and that will be the extent of the price analysis. It will not matter than the rates are 2-3 years old or perhaps no rate information. The message was been sent by AT&L, pricing actions under these thresholds are immaterial and become a blank check for contractors. I am curious about the independence comment made by Frank. I thought that the Defense Business Board in its October 2008 report stated that DCAA should perform any audits it felt necessary regardless of the DPAP guidance, FAR, DFARS, CAS, etc. How can DPAP decide the audits to be performed by DCAA? This seems to be an independence issue. The PGI guidance was not revised due to a change in law or other legal statute. Perhaps Fitzgerald is confusing Army Audit with DCAA where in Army Audit the Secretary of the Army may decide the audits that are performed. But in DCAA, the responsibility is on the DCAA Director to decide the audits that are necessary, no one else has that responsibility. I believe we have a GAGAS noncompliance. POGO, could you research the independence issue. This could be very serious.

Posted on: Oct 30, 2010 at 08:02 AM

John    Agree with Frank and Mike. The Pentagon has wanted DCAA to get out of the forward pricing audit business for years. Contracting officials want to place as much money on contract as possible and do not want to have to address audit findings while negotiating contracts. However, I would argue that the new thresholds really do not matter because many forward pricing reports are issued too late to be of use to the contracting officer and many others are never issued because the supervisor, manager, region, QA reviewers have an issue with the working papers such as the entrance conference was not thoroughly documented or the sample was too small. All the while, real dollars are wasted especially on FFP contracts. Assignments are cancelled all the time. I recall a time when the FAO had a prepare a detailed explanation for the region when it cancelled an assignment. Now we cancel more assignments that we complete. POGO, you should ask for the number of cancelled assignments for the last five years, you should see a significant increase in FY 2010. Not to mention the millions that have gone unaudited and thousands of audit hours wasted. I guess Army Audit has a very liberal cancellation policy.

Posted on: Oct 29, 2010 at 07:42 PM

Jan   Here's the next scandle, DCAA spends twice as much to do 25%of the audits. Overpayments and fraud triple due to no oversight. GAO and IG find DCAA's audit working papers are perfect, but gig DCAA for performing marginal analytical procedures. Wake-up Fitzgerald, you have many hearings in your future so start practicing the opening statement on how the Pentagon made you do it and how important it is to ensure that all the i's are dotted and t's are crossed. Oh, and do not forget, you are responsible for DCAA and cannot use the Pentagon or anyone else as an excuse. The independence issue is squarely on you. Keep in mind that Under Secretary Hale and Deputy Lynn will not be around forever to protect you.

Posted on: Oct 29, 2010 at 07:01 PM

Mike   This action is very short-sighted by Director Fitzgerald. The ratio of questioned cost to dollars examined on the smaller dollar pricing actions is generally greater than the larger dollars especially the fixed price effort. These are generally smaller, less experienced contractors that do not have adequate pricing systems in place and are not knowledgeable of the FAR and CAS. Last month my office issued a report on a FFP $8 million proposal. We questioned half of the proposed amount ($4 million) because the contractor charged all indirect costs to the Government contract and none to its commercial customers. Reason, the commercial customer would not pay for the indirect costs, but they tried to get the Government to pay it. The CO sustained 100% and reduced the negotiated price accordingly. DCMA does not know contractor accounting records at the level of detail as DCAA and would not have had this finding in their price evaluation. Result, $4 million down the drain. POGO stay with this one, it has scandle written all over it.

Posted on: Oct 29, 2010 at 06:10 PM

Frank   It is an impairment to DCAA's independence for the Pentagon to dictate the audits that DCAA will perform. If there is a risk such as an inadequate estimating system, history of overbillings, or even fraud referrals, DCAA should be able to perform the pricing audits. This is just the Pentagon's way of reducing the oversight of contractors. DCMA is not equipped to handle the significant workload associated with pre-award pricing effort on cost-type contracts under $100 million and fixed-price under $10 million.

Posted on: Oct 29, 2010 at 0 http://pogoblog.typepad.com/pogo/2010/10/declining-dcaa-role-in-oversight-of-tens-of-billions-of-pentagon-contract-dollars.html6:02 PM

http://pogoblog.typepad.com/pogo/2010/10/declining-dcaa-role-in-oversight-of-tens-of-billions-of-pentagon-contract-dollars.html

 

DoD Auditors Auditing Less.

Here is another article and comment sent from a reader.  Thank you again, Old Navy Man.  And GFS

 

 

G. Florence-

 

Reduce government, and you reduce defense contractor oversight.

 

An Old Navy Man

 

  

WashingtonTechnology

 

DOD auditors raise the limit on what they'll examine

Watchdog group cries foul over what they see as reduced oversight

By Alice Lipowicz

Oct 29, 2010

 

The Defense Department has reduced the scope of contracts audited by the Defense Contract Audit Agency, according to a DCAA memo released today by the Project on Government Oversight, a watchdog group.

According to the memo, contracting officers' requests for DCAA reviews of contractor cost data must meet a threshold of $10 million for fixed-price proposals and $100 million for cost-type proposals, unless there are exceptional circumstances.

Previously, the threshold was $700,000 for fixed-price proposals and $10 million for cost-type proposals, POGO officials said in a post published on the organization's website.

Approximately $92 billion in annual DOD contracts will be affected by the new thresholds, POGO estimated, calling it a radical reduction in contract oversight by DCAA.

“POGO has long feared contractors and their government allies would block DCAA from exposing contractor ripoffs,” Nick Schwellenbach, POGO’s director of investigations, said today.“Why are billions of dollars being put at risk when [Defense] Secretary [Robert] Gates is demanding cost savings?”

DCAA officials were not immediately available for comment.

 

 http://washingtontechnology.com/articles/2010/10/29/dcaa-audits-contractor.aspx

 

 

 

Oversight of Contracts Worth Billions and Billions is Broken

This is another article sent to me today.  Thank you reader!  GFS

 

G. Florence-

 

The Defense Contract Audit Agency (DCAA) is broken.  The Defense Contract Management Agency (DCMA) is broken.  And the Defense Security Service (DSS) is broken.  It looks like the entire contracting and security oversight of defense contractors is broken.

 

 

An Old Navy Man

 

 

POGO

Pentagon Radically Reducing Oversight of Contracts Worth Tens of Billions

October 29, 2010  Nick Schwellenbach

The Pentagon has radically decreased the Defense Contract Audit Agency’s (DCAA) review of contracts, according to an October 18 DCAA memo obtained by POGO. DCAA’s job is to protect taxpayers from contractor overbilling.

“POGO has long feared contractors and their government allies would block DCAA from exposing contractor ripoffs,” said Nick Schwellenbach, POGO’s director of investigations.  “Why are billions of dollars being put at risk when Secretary Gates is demanding cost savings?”

According to the memo, contracting guidance “now limits contracting officer requests for audit services to Fixed-price proposals over $10 million and Cost-Type proposals over $100 million, unless there are exceptional circumstances.”

These audit services are reviews of cost data (referred to as “reviews”) and they entail an examination of a contractor’s cost proposal to the government.  In these proposals, contractors estimate how much it will cost them to accomplish work on a contract.

Previously, there was no dollar threshold for reviews on fixed-price contract proposals, but contracting officers would limit requests for DCAA reviews of proposals over a threshold tied to the submission of cost or pricing data, which is currently $700,000. The old threshold for reviews of cost-type proposals was $10 million, but could be lower if the contractor has systemic problems estimating costs.

In FY 2009, a total of at least $92 billion in Defense Department contracts fell between the old thresholds and the new ones, according to USAspending.gov.  The $92 billion figure is a conservative estimate – it reflects awarded and funded contracts, rather than contract proposals, which are often higher than the funded contract award amounts.

The guidance states that cost proposals below the new dollar thresholds for review may be sent instead to the Defense Contract Management Agency (DCMA). DCMA is typically less thorough than DCAA, according to a 2009 Wartime Contracting Commission report.  The DCMA also does not specialize in examining and verifying cost and pricing data.

The reason for this new restriction is DCAA’s attempt to perfectly comply with Generally Accepted Government Auditing Standards (GAGAS). With this standard, which requires meticulous documentation of findings, DCAA is unable to cover as much ground as they used to, thus the need to restrict “audits” as defined by GAGAS.  The number of DCAA reports produced annually has plunged: 33,801 in FY 2007 to 30,352 in FY 2008 to 21,276 reports in FY 2009.

Rather than subjecting reviews of cost or pricing data to GAGAS, DCAA should consider these reviews as financial advisory services, which are not subject to all GAGAS requirements.  This would better protect taxpayers and warfighters by allowing DCAA to review cost data and deliver advice to contracting officers in a timely fashion.

Founded in 1981, the Project On Government Oversight (POGO) is a nonpartisan independent watchdog that champions good government reforms. POGO's investigations into corruption, misconduct, and conflicts of interest achieve a more effective, accountable, open, and ethical federal government.

http://www.pogo.org/pogo-files/alerts/contract-oversight/co-ca-20101029.html

 

Congress, Corruption, Cover-ups and Government Oversight Agencies Gone Wild

A reader sent this to me today and asked to remain anonymous when it posted.  Thank you to the reader who took the time to write this thoughtful comment.  Here it is.   GFS

Has anyone considered the DSS mad-dash to become an "Intelligence Agency" might have been a desperate attempt to hide from any oversight? As an Intelligence agency, they would not have to answer to any inspectors, DOD/IG, GAO or even Congress. Their years of incompetence, mismanagement and looking the other way while Defense contractors compromised our nation's most classified technologies would be safe from accountability.

Why would they do this? As an example, simply look at the former DSS upper management personnel who have garnered for themselves high paying positions within industry after leaving Government service.

Look back to the Boeing Tanker scandal, Senator McCain publicly asked for a list of all formerly high placed government employees who retired and went to work for DOD contractors. Senator McCain is/was a very influential Senator, yet no such list was ever forthcoming to the public and after losing the Tanker contract, Boeing pulled a Senator or two and a couple of Congressmen/women out of a hat and hocus-pocus, Boeing is back in the Tanker business.

This is just one example of what is going on within DSS and most other agencies; DSS looks the other way, Senators and Congressmen look the other way and God help anyone stupid enough to report security violations, retaliations here we come!  No one wants to address the fraud waste and abuse that is taking over our whole government; why fall on your sword and ruin your career when nothing will change.

I have found with association with others as well as my own personal involvement,  that a great many major security violations and classified technology compromises that we reported, were either dismissed by upper management types who were more loyal to Industry than to the government or dismissed as not an issue, by hiding behind the claim, "National Secrets", and thereby not having to explain anything to anyone with no further comment.  Or the problems we reported were  just plain covered up by agencies such as DSS, Navy, DCIS, NCIS and others. This is the norm in today's Government upper management - no ethics, and no honor.

If it were not so sad a state of affairs in our government, you could laugh at those who are asking Congressmen/women and Senators to pass Whistle blower protections for those who report Fraud, Waste and Abuse.

Think about this; they are asking for Congressmen/women and Senators to provide protections for those who report criminal acts committed by those very same members of Congress, and therein is the reason why agencies such as DSS, Navy, DCIS, NCIS, etc do not fear having to be held accountable for their actions. Our Congressional Representatives don't want to be thrown under the bus or in some cases, disrupt the production of the campaign cash cow. 

-Anonymous Guest Blogger

POGO Reports: Secret Deals May Lead to Bailouts for Defense Contractor Misconduct

Something I found today on POGO follows..  There seems to be a pattern of seeking no accountability for contractor’s malevolent actions.  KBR (Halliburton) has a disgraceful record in the Middle East.  Is this another such corrupt action taken by government, in this case DoD,  to hold these contractors harmless for their crimes?  Could something be in the works for other contractors? 

Read the articles posted previously on this blog regarding the unfortunate experiences of Boeing International Support Systems employee, Robin Petersen, and his being held captive by BISS and Saudi Arabia and not be allowed to return to the U.S. for medical help after he was injured while doing the job he was hired to do by this Boeing wholly owned subsidiary while in Saudi Arabia.  Boeing’s evasion of Petersen's attorney serving Boeing/BISS the summons and paperwork for Petersen's lawsuit is certainly interesting in light of all of this.

Think back to Druyan and Sears and the Tanker scandal and Boeing getting Eric Holder's help in putting into place a non-prosecution agreement.  As long as Boeing offered up victims, of lower managers or employees, Boeing Corporate itself would not be held accountable or be barred from receiving contracts in the future.  Handy, yes?  Is there some other smoke and mirrors thing starting to manifest itself again?  This time it would be DoD writing off accountability for contractors and their actions.  GFS

POGO

Oct 01, 2010

Secret Deals May Lead to Bailouts for Defense Contractor Misconduct

We may be unknowingly bailing out defense contractors such as KBR for the harm they cause, according to Rep. Earl Blumenauer, D-Ore.

This week, Blumenauer, along with Rep. Kurt Schrader, D-Ore., and Sens. Ron Wyden, D-Ore., and Jeff Merkley, D-Ore., introduced the Accountability for Defense Contractors Act. This bill would increase transparency and accountability in defense contracting by regulating the Pentagon’s use of classified contract provisions that indemnify contractors from damage lawsuits. It would require the Secretary of Defense to notify Congress when accepting liability in excess of $1 million on behalf of a contractor. It also would prohibit indemnification in cases where the contractor acted with “gross negligence, willful misconduct, or lack of good faith” or the harm resulted from “an unusually hazardous or nuclear risk not specified in the terms of the contract and discovered on the site where the contract is performed, or that reasonably should have been discovered.”

Last year, several Oregon National Guard veterans sued KBR for knowingly exposing them to a cancer-causing substance called hexavalent chromium while protecting KBR employees who were restoring a water treatment plant in Iraq in 2003. It was discovered during the course of litigation that KBR’s Restore Iraqi Oil (RIO) contract with the U.S. Army contains a classified clause indemnifying KBR for any property damage, injury or death occurring at all KBR worksites. Similar lawsuits against KBR have been filed by current and former National Guard members from Indiana and West Virginia who were also stationed at the water treatment plant in the early months of the war. This means the Army (i.e. the taxpayer) could be hit with millions of dollars in costs and damages.

Last month, Army Secretary John McHugh refused to declassify the KBR indemnification clause in his response to Blumenauer’s inquiry, but he insisted that, apart from the RIO contract, no other Army contracts awarded to companies operating in contingency situations since 2001 contain indemnification provisions. Left unsaid, of course, is whether the other service branches and units of the Department of Defense, to say nothing of other federal agencies, are providing secret indemnity to their contractors.

“The Army considers the use of indemnification provisions only in extraordinary circumstances involving unusually hazardous risks,” McHugh wrote. He also assured Blumenauer that KBR has not yet asserted any claim—and the Army has not made any payments—under the provision.

We’re glad to see Members of Congress addressing this issue and we support the Accountability for Defense Contractors Act. But we’re not convinced that contractors need immunity for wrongdoing. We’re also still left wondering: If certain government functions require perks such as secret grants of legal immunity in order to get the private sector to perform them, why are these functions even considered suitable for outsourcing in the first place?

Neil Gordon

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