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Press Release: FTA Confirms Overreporting by the CTA

October 23, 2012 by

FTA Confirms Overreporting by the CTA

Cause of Action’s Investigation Into Potential Fraud With Federal Grant Money Exposes CTA & the Department of Transportation

 

WASHINGTON – In the wake of Cause of Action’s investigation into potential fraud at the Chicago Transit Authority, new facts have emerged confirming not only overreporting by the CTA, but knowledge by the Department of Transportation’s Federal Transit Administration of the overreporting.

FTA Administrator Peter Rogoff sent a letter to CTA on April 27, 2012 stating that FTA had “conducted an in-depth review regarding the way in which Vehicle Revenue Miles (VRM)” were reported. The conclusion of this review was that “CTA should revise its data for the 2011 Report Year to reflect the definition of ‘revenue service’.”

Cause of Action’s Executive Director Dan Epstein issued the following statement in response:

“FTA’s letter highlights two very important facts. First, CTA was, as Cause of Action suspected, violating the reporting manual used to calculate VRM, thereby improperly receiving federal grant money.

But secondly, FTA is revealing that it had knowledge of overreporting occurring, and by conducting a review of only 2011, it ignored the 2007 report presented by auditor Thomas Rubin that showed the same potential actions happening in fiscal year 2006.

It appears an explanation for why FTA limited its review to one year, and failed to disclose its findings to Cause of Action following our expedited FOIA request, is that there is clearly a politically motivated cover-up happening at the Department of Transportation.

Cause of Action’s revealing investigation into opaqueness and poor stewardship of tax dollars only further raises the spectre of corruption at the same agency Cause of Action revealed to have had two officials violate the Hatch Act.  Just as no punishment occured when Kathleen Sebelius violated the Hatch Act, no punishment will occur with a CTA that defrauded the American taxpayers. Cause of Action exists to fight this kind of corruption and show the American taxpayers exactly what is happening to their money in the hands of corrupt politicians.”

This revelation by the FTA raises a number of questions that Cause of Action views as critical to the public interest:

  1. Why did FTA not act on Thomas Rubin’s 2007 report of this exact behavior by the CTA?
  2. When did DOT Inspector General Calvin Scovel decide to investigate the matter?
  3. Is there evidence to suggest that this same type of overreporting is happening at other transit authorities around the United States?
  4. Why hasn’t the FTA reported the CTA to the Department of Justice for a criminal investigation in light of their overreporting and potential years of defrauding American taxpayers?
  5. How does the President explain the Chicago connections of Secretary LaHood, Robert Rivkin, Valerie Jarrett and himself in light of this misuse of taxpayer dollars?

About Cause of Action:

Cause of Action is a nonprofit, nonpartisan organization that uses investigative, legal, and communications tools to educate the public on how government accountability and transparency protects taxpayer interests and economic opportunity. For more information, visit www.causeofaction.org

 

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Filed Under: Press Release Tagged With:

COA Internal Audit Finds No Wrongdoing

October 12, 2012 by

INTERNAL AUDIT FINDS NO WRONGDOING

Federal Agency Spending on Commemorative and Promotional Items Accurately Represented

WASHINGTON —Government accountability group, Cause of Action, released on Friday a report that outlines its own internal review following statements made by the Department of Homeland Security Office of the Inspector General.

 Analysis of the internal review found that the original report, “Coin for Coins,” remained an accurate and true picture of federal spending on promotional and commemorative items at the nine federal agencies that are highlighted. This analysis was reached based on two findings:

  1. Department of Homeland Security Office of the Inspector General did, indeed, spend money on promotional items during the fiscal years under review.
  2. That this information, including information about cash awards to employees, was reported to Cause of Action by the FOIA office at DHS OIG to Cause of Action, during an interim FOIA production.

 Despite attempts to the contrary, the fact remains that the DHS OIG did indeed purchase promotional and commemorative items during the time period in question.

 “The DHS OIG accused Cause of Action of misrepresentation, claimed our report was misleading and erroneous, and stated our reporting was shoddy – in addition to attacking the credibility of Fox News and Government Executive,” said Dan Epstein, executive director of Cause of Action.

“Not only has DHS OIG failed to show any factual inaccuracies in Cause of Action’s work product, DHS OIG has been deceptive in its statements – failing to publicly disclose that DHS OIG spent tax dollars on trinkets, including paperweights, plaques, shadow boxes, mugs, Nike crush ball sleeves, zippered leather portfolios, rollerball pens, curved tumblers, and clocks. Furthermore, our review revealed DHS OIG gave commemorative items given to U.S. Attorneys, Assistant U.S. Attorneys, the U.S. Department of Justice, federal special agents, the FBI, a staffer at the U.S. House of Representatives, and to the Committee on Oversight and Government Reform. One wonders why the IG is providing tokens to federal investigators when top officials within the inspector general’s headquarters have been placed on administrative leave or transferred outside the agency as a result of a grand jury probe. Among those on leave are the inspector general’s top criminal investigator, Thomas M. Frost and a deputy, John Ryan. Instead of investigating the processes and procedures of the OIG FOIA office or disclosing DHS OIG’s commemorative item spending – or actually fully producing the documents owed to Cause of Action under FOIA, the taxpayer-funded IG decided to spend his time going after a taxpayer watchdog group.”

Highlights of the 95-page report include:

  • Pages 13-23: CoA’s April 4, 2012 FOIA request to DHS OIG on promotional items
  • Pages 25-27: Letter from Katherine Gallo at DHS OIG producing only an “interim response” to CoA’s request “seeking records pertaining to commemorative items.”
  • Pages 41-42: E-mails between Nikki Gramian and CoA staff where Nikki Gramian suggests producing cash awards to CoA.
  • Pages 45-47 & 77-86: DOJ OIG Commemorative Item Award Spending from 2009-2012
  • Pages 91-95: E-mail communications between DHS OIG and Cause of Action concerning the report.

 As always, Cause of Action remains committed to informing the public on issues of government accountability and transparency, which is why CoA conducted a thorough internal audit to ensure that no wrong had been done by the organization or its staff.

 About Cause of Action:

Cause of Action is a nonprofit, nonpartisan organization that uses investigative, legal, and communications tools to educate the public on how government accountability and transparency protects taxpayer interests and economic opportunity. For more information, visit www.causeofaction.org.

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The report can be seen here.

Filed Under: Press Release

Coin for Coins: Cause of Action Finds Federal Agencies in Violation of Executive Order on Spending

October 9, 2012 by

Coin for Coins: Cause of Action Finds Federal Agencies in Violation of Executive Order on Spending

Taxpayer Dollars Purchased iPods, Plaques, Yo-Yos and Coins 

WASHINGTON – Federal government accountability group Cause of Action (CoA) today released findings of direct violations of President Obama’s order for agencies to limit spending on promotional items. A six month investigation reveals a pattern of wasteful spending across nine specific federal agency offices that are catalogued in Coin for Coins: Federal Agency Spending on Promotional and Commemorative Items, a report released today.

In November 2011, President Obama advised federal agencies through the Executive Order on Promoting Efficient Spending (EO 13589) that “[a]gencies should limit the purchase of promotional items (e.g., plaques, clothing and commemorative items), in particular where they are not cost-effective.”

Some of the most egregious examples of spending include:

  • One United States Department of Agriculture office spent $38,870 on GPS systems, Nook 3G digital readers, Apple iPods, and Nikon Coolpix cameras for staff.
  • Department of Justice COPS spent over $12,000 on commemorative items for a single conference.
  • Department of the Interior Fish and Wildlife Service spent over $86,000 on commemorative items between 2009 and 2012.

Dan Epstein, executive director of Cause of Action, highlights how this pattern of spending is a symptom of a larger problem in Washington:

Our investigation shows that a federal government culture of waste, fraud and mismanagement remains an unchecked liability throughout federal agencies. A cavalier attitude toward the efficient use of tax dollars permeates the executive branch. While some agencies track their spending, revealing patterns of waste, others don’t even bother to document it. The Department of Defense, with one of the largest budgets, informed Cause of Action that it has no means of tracking promotional spending, rendering accountability impossible. Just in the past year we’ve seen reports of the Government Services Administration and Veterans Affairs conference spending scandals, Secretary Sebelius’s Hatch Act violations, and conflict of interest violations by NLRB Acting General Counsel Lafe Solomon.  It is clear that those in the current Administration with the responsibility to steward taxpayer dollars, the President included, are not taking their jobs, nor a commitment to ethics and transparency, seriously.

Following the April, 2012 GSA spending scandal report from the GSA Inspector General, CoA submitted Freedom of Information Act (FOIA) requests to 32 federal agency offices demanding production of information concerning commemorative awards that have been paid for by taxpayer dollars.

Coin for Coins: Federal Agency Spending on Promotional and Commemorative Items analyzes spending from the United States Department of Justice (DOJ), Office of Community Oriented Policing Services (COPS), United States Department of Homeland Security (DHS), OIG, United States Department of Agriculture (USDA), Food Safety and Inspection Service (FSIS), United States Department of the Interior (DOI), Fish and Wildlife Service (FWS), United States Department of Agriculture (USDA), Forest Service (FS) Alaska Region, United States Department of Agriculture (USDA), Forest Service (FS) Southwestern Region, United States Department of Agriculture (USDA), Rural Development (RD), Department of Energy (DOE), OIG, and the United States Department of Defense.

About Cause of Action:

Cause of Action is a nonprofit, nonpartisan organization that uses investigative, legal, and communications tools to educate the public on how government accountability and transparency protects taxpayer interests and economic opportunity. For more information, visit www.causeofaction.org

This release was updated on October 11, 2012. The following sentences that appeared in the original release have been removed:

“CoA’s initial investigation into nine agency offices documents $1,123,118 spent on items such as yo-yos, water bottles, pens, trophies, and other awards.”

“Department of Homeland Security OIG offices spent nearly $700,000 on awards in fiscal year 2010.”

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Filed Under: Press Release

CoA Memo on NLRB’s Lafe Solomon & Conflict of Interest Law

September 20, 2012 by

Following the NLRB Office of Inspector General’s report on General Counsel Lafe Solomon’s conflict of interest in a matter before the board, Cause of Action is providing the following legal analysis for public education.

Cause of Action Memo on NLRB OIG Report Re: Lafe Solomon Conflict of Interest

Filed Under: Press Release Tagged With:

Cause of Action Demands Answers From NLRB On Ex Parte Communications

September 11, 2012 by

 

CAUSE OF ACTION DEMANDS ANSWERS FROM NLRB ON EX PARTE COMMUNICATIONS

Inspector General at NLRB May Have Ignored Evidence Against Lafe Solomon and Wilma Liebman

WASHINGTON – Cause of Action (CoA), a government accountability group, sent a letter on Monday to National Labor Relations Board (NLRB) Inspector General David Berry (IG Berry) requesting documents and communications about alleged ex parte communications by NLRB Acting General Counsel Lafe Solomon and former NLRB Chair Wilma Liebman first revealed by CoA in November of 2011.

On November 22, 2011, CoA requested that IG Berry open an investigation to determine whether Wilma Liebman engaged in ex parte communications with Lafe Solomon. CoA submitted several emails evidencing communications between Solomon and Liebman concerning strategies surrounding the pending litigation by the NLRB against the Boeing company. Despite this evidence, deposition transcripts from March 15, 2012 related to the NLRB’s investigation into Terence Flynn reveal that IG Berry denied any other instances of ex parte communications, stating “If I have evidence other people are engaging in this type of conduct, we would look at other individuals.” While Inspector General Berry has not confirmed whether an investigation has begun, CoA is concerned that Berry may have delayed investigating CoA’s allegations until after the OIG’s two investigations into two Republicans at the NLRB: Board member Brian Hayes and then-Chief Counsel Terence Flynn.

CoA’s Executive Director, Dan Epstein, is concerned about IG Berry’s apparent failure to promptly investigate allegations of improper communications:

“In November 2011, Cause of Action provided IG Berry with internal NLRB emails evidencing potential ex parte communications between Lafe Solomon and Wilma Liebman during Lafe Solomon’s litigation against Boeing in 2011. These alleged ex parte communications were shown to have occurred even after Lafe Solomon filed the complaint against Boeing in April 20, 2011. The allegedly improper communications by Terence Flynn occurred starting in September 2011; the alleged improper communications from Member Hayes occurred between September and November 30, 2011. And yet investigations of Hayes and Flynn occurred even though the alleged improper activities by Wilma Liebman and Lafe Solomon occurred months before. As CoA states in its letter to IG Berry, ‘we are particularly troubled that a decision, if any, to investigate the allegations of ex parte communications by Wilma Liebman and Lafe Solomon after substantial delay may be arbitrary and capricious, if not politically charged.’ This is why we are requesting any documents from the NLRB that would verify that IG Berry is in fact investigating based upon the evidence Cause of Action submitted to him nearly 10 months ago.”

CoA’s letter, a Freedom of Information Act request, asks for the following:
1) All records, including e-mails, referring or relating to Cause of Action’s November 22, 2011 request for an NLRB OIG investigation.

2) All records referring to or related to Congressman Kline’s letter of April 13, 2012.

3) Any and all investigative reports or documents submitted to Congress regarding the substance of Chairman Kline’s April 13, 2012 letter.

4) All records referring to or related to allegations of ex parte communications from officials of the NLRB pertaining to the Boeing matter referenced above.

5) All records pertaining to concluded investigations or determinations made regarding Cause of Action’s November 22, 2011 request for investigation.

6) All records of any concluded investigations, both criminal and administrative, into NLRB ex parte communications regarding the Boeing matter referenced above.

7) All records referring or relating to why investigative reports such as Reports concerning OIG-I-467 and OIG-I-468 are not publicly posted by the NLRB OIG.

8) All documents referring or relating to the procedures used by the NLRB OIG to determine whether information or allegations are sufficiently “credible” to warrant the launching of an investigation.

9) Any and all records concerning referrals by the NLRB OIG to the U.S. Department of Justice.
The full letter can be found here.

Previous requests and findings by CoA concerning ex parte communications at the NLRB can be found here.

About Cause of Action:
Cause of Action is a nonprofit, nonpartisan organization that uses investigative, legal, and communications tools to educate the public on how government accountability and transparency protects taxpayer interests and economic opportunity. For more information, visit www.causeofaction.org.

Filed Under: Press Release Tagged With: ,

New York Times: Inquiry Starts at FAA Over Remark on Budget

September 10, 2012 by

Read the full story here. The New York Times

“In the e-mails, obtained by the watchdog group Cause of Action, an F.A.A. employee in Seattle gives an account of Mr. Hickey’s remarks at the May 23 session. (The names on the e-mails are blacked out; the contents are reprinted here with typographical errors intact.) Cause of Action has asked for the F.A.A.’s inspector general to investigate.

“I would not be able to quote Mr. Hickey exact words, but what I took out of it was, if the conservative republication gain control of congress then the FAA could be looking at as much as a 15% cut in budget and we may be looking at furloughs,” one e-mail said. “If the liberal Democrats take control of congress then we would be looking at a flat budget. In short if the Republicans win office our jobs may be effected (furloughs) if the Democrats win office then our jobs would not be effected….”

Filed Under: News Tagged With: ,

FAA Hatch Act Investigation Exhibits

September 5, 2012 by

 

Cause of Action released documents today revealing a potential Hatch Act violation at the Federal Aviation Administration (FAA) involving John J. Hickey, deputy associate administrator for aviation safety at the FAA, and Raymond Towles, deputy director of flight standards field operations. At a May 23, 2012 staff meeting, Hickey told subordinates that “if the Republicans win office [their] jobs may be effected [sic]…if the Democrats win office then [their] jobs would not be effected [sic].” Additionally, Hickey and Towles held mandatory meetings with employees at other regional FAA offices, where similar comments may have been repeated.
 
In light of these allegations, Cause of Action sent a request for investigation to Inspector General at the U.S. Department of Transportation Calvin L. Scovel III, urging “a swift investigation, not only into whether the comments made by Mr. Hickey and Mr. Towles at the Seattle FSDO violated the Hatch Act, but also whether their comments violated any other federal laws, as well as if they engaged in any other activities in violation of the Hatch Act or other applicable law.”

 

The documents related to this investigation:

Exhibit 1 (2)

Exhibit 2 2_Redacted

Exhibit 3 1_Redacted

 

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