Archives for June 2013

REPORT: Ethical Violations and Retaliation: How to Get Promoted at the Bureau of Indian Affairs

According to a Department of the Interior, Office of the Inspector General (DOI OIG) report  and numerous complaints filed by Bureau of Indian Affairs (BIA) employees, Jeanette Hanna, the former Regional Director of the Eastern Oklahoma Regional Office of the BIA, mismanaged tribal trust funds, abused her authority, retaliated against employees, steered contracts, and had an inappropriate relationship with a government contractor that created a conflict of interest.  The DOI OIG report reveals that there were at least 17 formal complaints, 2 separate DOI OIG investigations, and 4 different reviews by the BIA and the DOI Office of Policy, Management and Budget (PMB) of Hanna’s behavior between 2005 and 2011.  Just how badly must a federal employee behave before getting fired?

In November 2009, the BIA placed Hanna on detail in Washington, DC, while the Office of the Assistant Secretary for Indian Affairs (AS-IA) reviewed her alleged ethical violations.  Hanna remained on detail for more than 500 days longer than allowed by agency rules.  However, no action was ultimately taken by the AS-IA, so the DOI OIG initiated an investigation in August 2011 after receiving information that BIA officials failed to act on the complaints against Hanna.

During the AS-IA’s formal review of the complaints against Hanna, investigators interviewed BIA employees who were “physically shaking” because they were so afraid Hanna might retaliate against them.  As the AS-IA discovered, Hanna had previously installed 40 “extra” security cameras with live feeds she used to monitor employees in her regional office, and the initial AS-IA report confirmed that Hanna engaged in retaliation and harassment of employees.  However, this report appears to have been ignored by higher ups at the AS-IA, who dismissed the findings as “minor personnel issues” and just so happen to be friends with Hanna.

Hanna not only fostered a hostile work environment.  The DOI OIG’s report ultimately found that the failure of the BIA and AS-IA to ensure Hanna followed agency spending procedures cost the government nearly $200,000.  After reviewing travel vouchers from Hanna’s detail filed by the AS-IA (to whom she had been assigned even though it was the AS-IA investigating her), investigators found an almost complete failure to comply with tax laws and agency regulations.  In sum, Hanna was reimbursed over $130,000 in travel costs, as she often traveled between Oklahoma and DC, with her $117-a-night hotel room sitting empty for weeks for at a time.  Perhaps even more outrageous, Hanna decided she required an agency-provided SUV for the over-two-year detail in DC “because of the snow,” as she later explained to investigators.

Following the DOI OIG’s referral, the U.S. Attorney’s Office (USAO) for the District of Columbia declined to prosecute this case.  While the USAO might have determined that the evidence did not warrant a criminal prosecution (even though Hanna still owes significant back taxes on her travel reimbursements), it is disturbing that such blatant disregard for agency regulations and federal law has warranted no punishment for Hanna.

To read the full story, see our investigation analysis here.

Drakes Bay Oyster Company Appeal Filings

As of May 24, 2013, Cause of Action no longer represents Drakes Bay Oyster Company, the Lunny family, or Dr. Corey Goodman and will be withdrawing as counsel from the litigation.

Filed 2/06/13:


Exhibit 1

Exhibit 2

Exhibit 3

Filed 2/07/2013

Motion for Expedited Ruling

Support for Expedited Ruling from Peter Prows

Filed 2/11/2013

Order Denying Injunction Pending Appeal (From Judge YVONNE GONZALEZ ROGERS)

Filed 2/12/2013:

Emergency Motion for Injunction Pending Appeal

Declaration of Amber Abbasi in Support of Emergency Motion

Filed 2/20/13:

Opposition to Emergency Motion (Filed by DOJ)

Filed 2/21/13:

Opposition to Amici Motion

Proposed Brief ISO Opp to Amici Motion to Participate

Declaration of Amber D. Abbasi ISO Reply to Emergency Motion

Exhibit 1 to Abbasi Declaration

Exhibit 2 to Abbasi Declaration ISO Reply to Emergency Motion

Exhibit 3 to Abbasi Declaration ISO Emergency Motion

Exhibit 5 to Abbasi Declaration ISO Reply to Emergency Motion

Reply to Emergency Motion for Injunction Pending Appeal

Filed 3/6/13:

Opening Brief and Statutory Addendum

Filed 4/3/13:

Appellee’s Answering Brief (Filed by DOJ)

Filed 4/22/13:

Appellants’ Reply Brief

How HHS Secretary Sebelius Broke Federal Law and Avoided Punishment

We’ve written before about Secretary of Health and Human Services Kathleen Sebelius violating the Hatch Act.  By campaigning for Walter Dalton’s election as Governor of North Carolina and Barack Obama’s reelection as President at a Human Rights Campaign Gala, Sebelius used taxpayer funding for her own partisan priorities.  The precedent for presidentially-appointed and Senate-confirmed federal employees violating the Hatch Act is resignation.  Sebelius is the highest-level federal employee to break this law, but President Obama, the sole administration official with the authority to see that the penalty for this violation was paid, not only declined to ask Sebelius to resign, but opted to keep the Secretary on for his second term.  White House spokesman Eric Schultz contended that this administration holds itself “to the highest ethical standards[,]” but the facts of the Sebelius debacle would suggest otherwise.

Sebelius labeled her speech at the Human Rights Campaign Gala as an “official” event, meaning that not only would her travel and time be paid for by the taxpayer, but the time and travel of her aide, AJ Pearlman, would be covered as well.  The Hatch Act is a federal law which, according to OSC, “prohibits federal employees from using their official authority or influence to affect the outcome of an election.”  For instance, the Secretary of Health and Human Services, under the law, cannot campaign for a political candidate using her official title, because this would be an abuse of government authority; nor can she use taxpayer-funded travel or the work hours of taxpayer-funded employees and aides to support a political event, because this would be an abuse of taxpayer funding, furthering a personal and political end.  However, Secretary Sebelius committed each of these violations at the HRC Gala – then attempted to cover it up.

In the first half-hearted attempt to make up for this abuse, Sebelius quickly reclassified the event as “political” instead of “official.”  This retroactive attempt to erase the fact that she used her standing as a Cabinet member to influence two upcoming elections was insufficient, and OSC nevertheless concluded that Sebelius did in fact violate the Hatch Act.

The second part of the abuse was the taxpayer dollars spent on the event, and accordingly, Sebelius had an HHS assistant request that the Democratic National Committee reimburse the government for her own travel.  Even this first attempt was mishandled, however: in January 2013, we filed an FEC complaint explaining that the DNC failed to properly disclose this reimbursement.  In fact, the reimbursement was almost impossible to connect to Sebelius’ Hatch Act violation at all: the DNC sent a check marked only with the word “travel” – preventing accountability in determining whether Sebelius’ violation of the law was truly “repaired” by reimbursement for her travel.

But the missteps didn’t end there.  Cause of Action found, after sending Freedom of Information Act requests to four separate agencies, that the U.S. Treasury was not, in fact, reimbursed.  Cause of Action’s FOIA request to the U.S. Treasury’s Financial Management Service turned up no responsive records – even though our FOIA production from OSC proved that Sebelius was ordered multiple times to reimburse the U.S. Treasury.  In the production we received from our FOIA request to HHS, Cause of Action found the DNC’s check, sent to reimburse HHS, not the Treasury:


While White House press secretary Jay Carney again assured reporters that “the U.S. Treasury has been reimbursed,” this has clearly not been the case.  OSC did, however, recognize that HHS was reimbursed instead of the U.S. Treasury, but failed to take action on it, as showed by Cause of Action’s FOIA production from OSC:


The improper reimbursement raises the question of whether the cost of the trip was truly reimbursed, or whether HHS was simply free to use the funds as it wished.  Because OSC did not insist on the proper execution of its own requests for reimbursement, taxpayers dollars remain, in effect, unrecovered.

While the reimbursement for Sebelius’ costs was bungled many times over, Sebelius was not the only federal employee affected by her violation.  In her lengthy process of abdicating responsibility for campaigning on the taxpayer dime, Sebelius effectively threw her own aide under the bus.  AJ Pearlman provided background research in preparation for the HRC Gala where Sebelius promoted Democratic candidates, and attended the event to assist.  As Cause of Action showed in an OSC complaint, when Sebelius scrambled to save her own skin by retroactively reclassifying the event as political instead of official, she made Pearlman’s actions illegal as well.  OSC openly acknowledged that Pearlman’s efforts could not legally be funded by the federal government and ordered Sebelius to reimburse the Pearlman’s travel costs as well, as revealed in a letter from OSC to HHS:

sebeliusblog2 sebeliusblog3

As Cause of Action showed in its January 2013 OSC complaint, if Pearlman’s actions, after Sebelius’s campaigning on government time, could not be funded by taxpayer dollars, then Pearlman too would have committed a Hatch Act violation.  As the OSC wrote to HHS: “the Hatch Act would have prohibited” Pearlman’s work on the HRC event – and so the funding had to be reimbursed.  Cause of Action did its part, but OSC has thus far refused to uphold its own rules (read more about Cause of Action’s letter to Congressman Darrell Issa requesting for investigation into OSC’s failure to execute its duties here).

OSC made clear in the excerpts above that had Sebelius classified the event as political from the beginning, Pearlman’s work would have prohibited by the Hatch Act, but it still chose not to take action against Pearlman. Additionally, the President refused to take any action against Sebelius for her violation, claiming that Sebelius’ meeting with “ethics experts” solved the problem.  The White House won’t hold Sebelius accountable, the U.S. Treasury has not been reimbursed, and OSC’s selective enforcement of the Hatch Act hides Sebelius’s victim: the aide who did as requested.

Sebelius broke federal law but the White House chose not to do its job and ask for her resignation – it seems that its “ethical standards” could use some work.

GAO on CPPW: Nothing to See Here

Arriving in the context of a broader lobbying controversy, the Government Accountability Office (GAO) recently released a report on the Centers for Disease Control and Prevention’s (CDC) lobbying policies. Even by the standards of government investigators, the GAO did a pathetic job examining the degree of CDC oversight of the Communities Putting Prevention to Work (CPPW) program and its award recipients.  It makes more sense to describe GAO’s work as a survey of CDC employees, rather than as an independent evaluative report.

In responding to requests for information from Senators Lamar Alexander (R-TN), Tom Coburn (R-OK), Susan Collins (R-ME), and Orrin Hatch (R-UT), the GAO reviewed:

[D]ocuments provided by CDC, including the written policy on lobbying that pertained to CPPW award recipients; CPPW award notices, which were the written agreements between the CDC and recipients; documentation generated by CDC staff during the monitoring of CPPW recipients; and CDC site visit reports.

The GAO also interviewed CDC officials regarding the lobbying policy that applied to CPPW award recipients in two hundred eighty CPPW cooperative agreements, all of which were made in fiscal year 2010.

But just over six weeks ago, Cause of Action (CoA) released its own report, “CPPW: Putting Politics to Work,” examining twelve grant recipients based on responses to FOIA requests we sent to the CDC. Of those twelve, eight appeared to use federal funds to illegally lobby for things like tobacco taxes, clean air ordinances, and bans on sugary-sweetened drinks, rather than on sensible preventative health efforts.

CoA’s report also demonstrated that the CDC failed to take comprehensive action in one case of illegal lobbying it actually managed to identify.  While the GAO had access to information on all grant recipients and considered two potential lobbying violations identified by the CDC, CoA continues to await more information from the CDC on the other grant recipients. If we found that eight of the twelve we have been able to investigate up to this point are at risk of violating federal law, how many more instances are out there that the GAO and CDC have failed to uncover?

Unfortunately, the GAO’s report was not a substantive investigation. In fact, the most noteworthy aspect of the GAO report is how sparingly the GAO examined the CDC’s ability to follow-through on its own processes for correcting instances of illegal lobbying by grantees.  Instead, the GAO confirmed that the CDC engaged in no active audit function for the CPPW program, could not independently verify subrecipient expenses, and depended on self-reporting by grantees.

These findings are particularly troubling because, as the GAO fails to mention in its report, by 2015 the Department of Health and Human Services will be able to spend $2 billion per year in perpetuity on similar programs through the Affordable Care Act’s Prevention and Public Health Fund.