Investigative Reports

An Amtrak Yard Engineer in Washington, D.C., resigned on March 20, 2018, in lieu of an administrative hearing after failing to report two prior criminal convictions in violation of various company policies.

The OIG investigated allegations of contract fraud and misuse of Federal funds related to a municipal boat access site renovation partially funded by a grant from the U.S. Fish and Wildlife Service (FWS).We did not substantiate allegations of contract fraud or the misuse of Federal funds. The problems we identified appeared to be the result of poor project management and poor workmanship, rather than fraud. The municipality has initiated legal proceedings to resolve the problems with the contractor.

A Baggage Foreman in Newark, New Jersey, was terminated from employment March 21, 2018, and an Usher/Gateman in Wilmington, Delaware, received a three-day suspension on March 15, 2018, for violation of company policies related to shipping boxes on Amtrak trains. Our investigation determined the Baggage Foreman shipped five boxes on a train without collecting and remitting the shipping fees to the company.

A Carman Journeyman in Chicago, Illinois, was terminated from employment March 26, 2018, following an administrative hearing for stealing Amtrak property from trains in the Chicago Yard.

The OIG investigated allegations that a U.S. Bureau of Reclamation (USBR) review of its own failures in oversight of a Federal grant was biased and that USBR or Office of the Solicitor employees made false statements during our initial investigation of the grant.We did not find any evidence that USBR’s review was biased or that employees made false statements.

OIG investigated allegations that offshore oil and gas company employees and contractors illegally discharged oil into the Gulf of Mexico.We determined offshore workers Luke Ball, Darryl Plaisance, and William Smith intentionally discharged oil into the Gulf while operating aboard a platform located on a Federal lease. All three individuals were criminally charged by a Federal grand jury in the Western District of Louisiana. Ball and Plaisance pled guilty to making a knowing discharge of a pollutant, and Smith pled guilty to making a negligent discharge of a pollutant into the Gulf. Ball served almost six months of incarceration followed by supervised release, and the remaining defendants were placed on probation and paid a criminal fine.

Two Customer Service Representatives were terminated from employment on March 20, 2018, and March 21, 2018, in Joliet, Illinois and Omaha, Nebraska, and two others are facing disciplinary action for the unauthorized release of passenger information. Our investigation determined the employees violated company policy when they accessed company computer systems to provide confidential passenger information to a law enforcement agency without prior approval from the company.

The OIG initiated an investigation after an inventory of a safe located in the Bureau of Land Management’s (BLM’s) Office of Law Enforcement and Security (OLES), found that thousands of dollars in gift cards were unaccounted for.We found 119 gift cards in the safe, valued at $2,345, and property receipts that indicated more than $10,000 in gift cards had been provided to a former OLES official and another BLM employee to use towards official purchases. We were unable to determine the disposition of the remaining gift cards because there was no documentation, and the former OLES official and the other BLM employees we interviewed did not recall how the gift cards were disposed of.

OIG investigated allegations that Joseph Dubois filed a fraudulent surety bond to secure a contract at the Pine Hill School, Ramah Chapter of the Navajo Nation, NM.We found that the Ramah Navajo School Board contracted Dubois to renovate a building at the Pine Hill School. The contracts required him to obtain and provide a surety bond, but instead Dubois produced a fictitious surety bond that falsely appeared to be under the authority of a legitimate surety company.Dubois pled guilty to passing fictitious obligations and to tax evasion in U.S. District Court for the District of New Mexico. He was sentenced to 27 months in prison followed by 3 years of supervised release and was ordered to pay $410,550 in restitution to the Ramah Navajo School Board and the Internal Revenue Service.

The OIG investigated approximately $1,600 in fraudulent charges that were made on several Government charge cards issued to a U.S. Geological Survey employee.We found no evidence that the employee made the fraudulent charges and we discovered that a friend of the employee may have been responsible. As a result, we closed our investigation and referred this matter to the local police department.

Please click the link below to access a press release describing this and other related documents.

The OIG investigated allegations that a Bureau of Indian Affairs (BIA) senior official approved or directed the approval of two drawdowns totaling approximately $3.1 million from an Operation, Maintenance, and Replacement (OMR) Trust Fund designated for a regional rural water system (RWS) at a time when the RWS was years from completion and had few, if any, OMR expenses. There was increased scrutiny of the senior official’s involvement because he was affiliated with a group that would be served by the RWS.Our investigation determined that a subordinate of the senior official, not the senior official, authorized the drawdowns. The senior official had recused himself from the matter and had no involvement in either drawdown.We also found that the subordinate failed to perform required due diligence before approving the drawdowns. After questions arose following the first drawdown, the subordinate of the senior official was directed to consult with BIA’s Office of Facilities Management and Construction (OFMC) prior to any future drawdowns, however, he failed to consult with OFMC prior to the second drawdown. The subordinate acknowledged he failed to perform the required due diligence and retired from the BIA before the completion of our investigation.The United States Attorney’s Office for the District of Montana declined prosecution.

OIG investigated allegations that Bureau of Indian Education (BIE) native language teachers accepted payments from a tribe, which illegally supplemented their Federal salaries.We substantiated the allegations. We identified BIE native language teachers who received two or three supplemental payments each, ranging from $1,490.48 to $5,544.43 per payment during the 2014 and 2015 school years. Several teachers admitted that prior to the first payment they were aware that accepting the money violated ethics rules and Federal law. Several also admitted they had been admonished by their supervisors and informed the payments violated Federal law. We also determined that at least one teacher solicited for payments at district and Tribal council meetings.The U.S. Attorney’s Office for the District of South Dakota declined prosecution. One of the teachers left the school shortly after we interviewed her, one teacher is now deceased, and the remaining teachers are still employed at the school.

OIG investigated allegations that an oil and gas company improperly claimed royalty suspension under the Deepwater Royalty Relief Act of 1995, and failed to pay mineral royalties associated with an offshore Federal lease.We determined the company was eligible for royalty relief but was required to pay royalties once it reached the royalty free production limit established for the Federal lease. We found the company failed to pay Federal royalties for a five-month period in 2015 after it exceeded its royalty suspension volume, but the company, without knowledge of our investigation or direction from the Office of Natural Resources Revenue (ONRR), self-corrected its royalty reporting and on February 6, 2017, paid approximately $194,974 in late royalties and over $8,000 in interest.

The OIG investigated allegations that a U.S. Bureau of Reclamation (USBR) contractor submitted a fraudulent claim for an equitable adjustment to a crane repair contract. The contractor allegedly altered cost submission documents submitted by the sub-contractor. We determined that the claim for equitable adjustment did not contain fraudulent information as alleged, and we confirmed that the sub-contractors cost submission documents submitted by the contractor were authentic.

The OIG investigated allegations that a National Park Service (NPS) senior manager purchased personal gifts with government funds, reprised against an employee, committed travel fraud, misused Government-owned vehicles, wasted training funds, improperly permitted park guests to lodge in a ranger station, and used her personal credit card to pay for lodging of park guests. We also investigated an alleged conflict of interest by a subordinate of the NPS senior manager.We substantiated several of the allegations, including that the senior manager used park funds to purchase two high valued items, valued at nearly $600, which could not be located or accounted for. We also confirmed the senior manager lowered the performance rating of an employee after concerns were reported related to the senior manager’s official travel. We further determined that the senior manager permitted visitors and park employees to lodge at a ranger station that was not approved as park housing. We also substantiated that the senior manager drove a Government vehicle to their private residence prior to official travel without the required written approval, and that the senior manager paid for a visitor’s lodging with personal funds and then claimed reimbursement from the Government. We did not find evidence that the senior manager committed travel fraud or wasted training funds as alleged.We also confirmed that a subordinate of the NPS senior manager improperly used park funds to purchase antiques from a family member, a violation of conflict of interest regulations.We referred this matter to the U.S. Attorney’s Office for the Western District of New York, which declined prosecution.

This Newsletter provides a bimonthly summary of selected investigative accomplishments.

OIG investigated allegations that a former Bureau of Indian Affairs (BIA) contracting employee had a conflict of interest involving a government contractor. We also investigated allegations that the employee had an inappropriate relationship with a second government contractor.Our investigation confirmed the allegations. The employee signed an agreement with a contractor to assist the contractor in obtaining government contracts in exchange for the employee receiving help to develop business on an Indian reservation. The employee denied the conflict of interest, however, the contractor provided us with the contract, which bore the employee’s signature.We further determined that the employee attended social functions and accepted at least one meal from the second government contractor, a prohibited source. The employee also failed to disclose multiple outside employment interests and income as required by government regulation.The employee left the Department. Prosecution was declined by the U.S. Attorney for the District of New Mexico.

OIG investigated allegations that a Bureau of Indian Affairs (BIA) employee improperly used a BIA purchase card to purchase speakers, headphones, and electronic tablets.Prior to any significant involvement by our office, we learned that BIA had already investigated the matter and confirmed that two employees inappropriately purchased and gave to colleagues eight headphones and two wireless speakers, totaling $2,931.92. One of the employees also used his personal funds to improperly purchase five tablet computers at a discounted rate through a BIA contract. Both employees involved in the purchases left the Department.Our investigation also found two supervisors were responsible for approving the purchase card purchases. One supervisor received a letter of reprimand, and the other was removed from Federal service. The United States Attorney’s Office for the District of South Dakota declined prosecution of this matter.

Four ticket agents resigned in February and March 2018, prior to their administrative hearings, for stealing money from their cash drawers at Amtrak’s Los Angeles Union Station. Our investigation determined that three of the employees would wait until train conductors electronically scanned passengers’ tickets and would then reset the ticket’s status as if it had not been scanned at all.

A former Amtrak Superintendent of Transportation at Chicago Union Station, Benjamin Sheets, was sentenced on February 27, 2018, in the Federal District Court of Northern Illinois after pleading guilty to making false statements to our agents in violation of 18 U.S.C. § 1001(a)(1).

We investigated allegations that a senior official with the U.S. Department of the Interior (DOI) made several comments that caused other DOI employees to question his ethics. He allegedly expressed his intent to assist two American Indian tribes he had worked with before becoming a DOI employee, encouraged subordinates to hire his former business associates and to arrange for the DOI to approve payment of the guarantee on a tribal loan he had been involved with before he came to the DOI, and asked a DOI employee to hire one of his relatives.We found that in the short time the senior official worked for the DOI, he made several comments that created an appearance to employees that he was planning to give preferential treatment to entities he had relationships with:• He told employees that he intended to continue assisting two tribes he had worked with before coming to the DOI. We found he assisted these tribes only once as a DOI employee, when he volunteered to schedule meetings for them with Secretary of the Interior Ryan Zinke.• He spoke to subordinates about hiring his former business associates and approving the loan guarantee payment. Although this did not violate regulations, his statements made his subordinates uncomfortable.• He asked a DOI employee to hire his relative. He claimed that his request had been meant as a joke, but the employee believed he had been serious.The senior official has left the DOI. We provided this report to the Deputy Secretary of the Interior for any action deemed appropriate.

OIG investigated allegations that an Office of Surface Mining Reclamation and Enforcement (OSMRE) employee stole government equipment and committed time and attendance fraud.We determined the employee stole two stereoscopes and a mapping tool from OSMRE and that the equipment was obsolete and valued at approximately $150. The employee admitted she had the items in her possession, and without authorization. She said she later donated the property to a charity. We did not substantiate the allegation of time and attendance fraud.The U.S. Attorney’s Office for the District of Colorado declined prosecution.

The OIG investigated allegations that Richard Ruggiero, Chief of the Division of International Conservation (DIC), International Affairs, U.S. Fish and Wildlife Service (FWS), may have violated Federal ethics regulations when he issued a cooperative agreement and was involved in two grants to nonprofit organizations with which a family member was associated.We found that Ruggiero violated Federal conflict of interest laws and regulations by participating in an FWS cooperative agreement that financially benefited his family member, and neither Ruggiero nor his family member disclosed their relationship in writing to the FWS. Ruggiero also shared nonpublic FWS information about the agreement with his family member. Ruggiero initially told us he did not participate in any decisions related to the agreement, but he later admitted his involvement and said he should have documented the potential conflict and recused himself from working on the agreement.Other FWS employees, to include one of Ruggiero’s senior employees, knew that Ruggiero’s family member was involved with the agreement, and that Ruggiero authorized additional funding to the agreement. The senior employee consulted with the FWS Ethics Office on behalf of Ruggiero, but failed to follow the guidance he received to have Ruggiero draft a recusal memorandum and submit it to the ethics office for review. Neither Ruggiero nor any of the other FWS employees reported the conflict of interest to the FWS Ethics Office.We also found that Ruggiero was a decision maker on other grants awarded by the FWS to organizations with which his family member was involved.We provided this report to the Acting FWS Director.