Federal Reports

The OIG investigated allegations that Smith & Marrs, Inc., an oil and gas production company, failed to report mineral production and sales from Federal leases located in New Mexico, which resulted in a loss of royalties owed to the U.S. Department of the Interior (DOI). We conducted the investigation jointly with the Bureau of Land Management’s (BLM) Special Investigations Group. We found that Smith & Marrs, Inc., failed to properly report oil and gas production and sales from Federal leases, which resulted in an underpayment of royalties and late payment interest. We then coordinated with ONRR officials to determine the total loss of royalties and interest, and ONRR sent Smith & Marrs payment requests for royalties due and late payment interest, which amounted to approximately $158,000. ONRR subsequently confirmed they had received full payment from Smith & Marrs.We referred our investigative findings to the U.S. Attorney’s Office for the District of Colorado, which declined prosecution.

Two executives at a textile company, based in Milford, Delaware, pleaded guilty to federal program bribery charges in U.S. District Court in February.Donald Crothers, the company’s vice president for marketing and contract administration, and John Gonzales, the company’s executive vice president and chief financial officer, pleaded guilty for their roles in a bribery scheme to secure Amtrak contracts for seat cushions. The executives bribed former Amtrak employee, Timothy Miller, then a Lead Contract Administrator, to steer four fleet maintenance contracts to their company in exchange for approximately $20,000 in bribes, trips, and other items of value. Crothers pleaded guilty on February 4, 2019, and Gonzales’ guilty plea came the following day.A cross-agency team of special agents from Amtrak OIG, the FBI, and the U.S. Department of Transportation OIG conducted the investigation that resulted in the charges.

An Amtrak Passenger Conductor, two Assistant Passenger Conductors, and an Usher/Gateman were disciplined for policy violations on February 5, 2019. The employees allowed and/or assisted non-ticketed passengers to receive unauthorized free travel aboard company trains on several occasions, generally at the request of other Amtrak employees. The employees received suspensions ranging from four to five days each.

We audited the costs claimed by the State of Arkansas, Game and Fish Commission, under grants awarded by the U.S. Fish and Wildlife Service (FWS) through the Wildlife and Sport Fish Restoration Program. The audit included claims totaling approximately $67 million on 57 grants that were open during the State fiscal years that ended June 30, 2016, and June 30, 2017. The audit also covered the Commission’s compliance with applicable laws, regulations, and FWS guidelines, including those related to collecting and using hunting and fishing license revenue and reporting program income.We found that the Commission complied, in general, with applicable grant accounting and regulatory requirements. We questioned costs totaling $102,720 ($77,040 Federal Share), however, because the Commission overcharged the grants for costs incurred and was missing or had inadequate documentation to support the costs incurred.Both the FWS and the Commission concurred with all six recommendations and will work together to implement corrective actions.

We audited the costs claimed by the Wyoming Game and Fish Department under grants awarded by the U.S. Fish and Wildlife Service (FWS) through the Wildlife and Sport Fish Restoration Program. The audit included claims totaling approximately $50.2 million on five grants that were open during the State fiscal years that ended June 30, 2016, and June 30, 2017. The audit also covered the Department’s compliance with applicable laws, regulations, and FWS guidelines, including those related to the collection and use of hunting and fishing license revenues and the reporting of program income.We found that the Department complied with applicable grant accounting and regulatory requirements. We did not identify any reportable conditions. We also followed up on all recommendations from our 2013 audit (Report No. R-GR-FWS-0010-2013) and found that the U.S. Department of the Interior, Office of the Assistant Secretary for Policy, Management and Budget considered one recommendation, related to real property reconciliation, resolved but not implemented. We did not require a response to this audit report.