Federal Reports

David Pugliese, a resident of Palm Beach County, Florida, was sentenced on January 12, 2024, in U.S. District Court, Southern District of Florida, for Conspiracy to Commit Health Care Fraud. Pugliese was sentenced to 30 months in prison, two years’ probation, and was ordered to pay restitution in the amount of $2,238,699. Pugliese was the manager and registered agent of Capital Advantage Diagnostics, LLC, which was purportedly in the business of performing a variety of laboratory tests for various health care providers.Our investigation found that Pugliese and others submitted false and fraudulent claims to Medicare and Amtrak’s insurance providers for claims that were not medically necessary or for laboratory tests that were never performed. Pugliese solicited beneficiary information and specimens for testing through the use of individual laboratory representatives and paid bribes to these representatives for specimens they provided. As a result of the scheme, Amtrak’s insurance providers were billed approximately $315,474.

The performance audit of AmeriCorps grants awarded to Serve DC, the Mayor’s Office on Volunteerism and Partnership, and three of its 16 subgrantees (including the Jumpstart for Young Children, Center for Inspired Teaching, and Inspired Teaching Demonstration Public Charter School) identified approximately $1.7 million of questioned Federal and match costs covering three calendar years from 2017 through 2019. The Inspired Teaching Demonstration Public Charter School became the Center for Inspired Teaching and had no claimed costs. In particular, the audit identified concerns regarding Serve DC and subgrantee’s inadequate documentation for personnel expenses, inadequate support for Serve DC’s in-kind match, Serve DC’s inadequate accounting records, subgrantee’s inadequate criminal history checks, and Serve DC and subgrantees’ insufficient internal controls that resulted in under or excess reporting of costs. Serve DC and Jumpstart for Young Children responded separately to address the report findings and recommendations; the Center for Inspired Teaching did not respond to the draft report. Serve DC did not concur with eight of the 16 recommendations, involving the questioning or disallowing of costs. Jumpstart also did not concur with its only recommendation which was related to the disallowance of match costs. AmeriCorps concurred with all our recommendations and promised to work with Serve DC to strengthen its internal controls surrounding the audit findings and will ensure Serve DC’s financial reporting aligns with financial management system standards.

As part of our annual audit plan, we performed an audit of costs billed to the Tennessee Valley Authority (TVA) by USA DeBusk, LLC (DeBusk) for industrial cleaning services provided under Contract Nos. 12042 and 17143. Our audit objective was to determine if the costs were billed in compliance with the terms of the contracts. Our audit scope included approximately $16 million in costs billed between January 1, 2021, and November 30, 2022, including $13.3 million in costs billed under Contract No. 12042 and $2.7 million billed under Contract No. 17143. In summary, we determined DeBusk overbilled TVA $21,157 in travel costs, including (1) $14,033 for ineligible daily commuting costs and (2) $7,124 in unsupported per diem costs. In addition, we identified opportunities to improve contract administration by TVA. Specifically,Pricing schedules for Contract No. 12042 were missing and could not be provided by TVA. As a result, we were unable to determine whether $12.97 million in labor, equipment, and travel costs billed to TVA were in compliance with the contract's pricing schedules or TVA's Project Maintenance and Modification Agreement. TVA could have saved an estimated $12,082 in fuel surcharges by stipulating the use of a fuel adjustment index more closely aligned with TVA's service region. Both contracts contained contradictory compensation terms and may not have conveyed the parties' intent regarding travel and temporary living allowance reimbursements.Invoice packages submitted to TVA for approval did not contain all of the required supporting documentation or match the costs billed through TVA's Maximo system.(Summary Only)