Investigative Reports

We investigated an allegation that a program manager with the West Virginia Department of Environmental Protection (WVDEP) misused Water-Use Data and Research (WUDR) grant funds awarded by the U.S. Geological Survey (USGS) to pay WVDEP employees who did not perform work related to the grant.Our investigation determined that from February 2018 through January 2020, the WVDEP incorrectly compensated an employee using $24,550 in WUDR grant funds. This employee unknowingly received WUDR funds toward his salary and benefits but did no work in support of the grant. We did not find evidence that the WVDEP intentionally misused the grant funds. Instead, the evidence suggested that the incorrect allocation of funds occurred because of management errors within the WVDEP.As a result of our investigation, the WVDEP corrected its internal WUDR grant funding allocations to accurately reflect the personnel who performed the WUDR grant functions during this time. Our investigation also confirmed that the WVDEP completed the work set forth in the WUDR grant as required and there was no financial loss to the Government.

A management official and a company Inspector violated Amtrak policies by accepting gifts and favors from a construction contractor who was awarded a $58 million contract by the company. The management official received gifts from the contractor, including three trips to Philadelphia, and drinks and entertainment at a gentleman’s club. His employment with the company was terminated on February 1, 2021. The Inspector received gifts from the contractor, which included a furnace for his church, a suit, and a pair of shoes. His employment with the company was terminated on March 30, 2021.

We investigated allegations that Nathan Shumaker, a service supervisor employed with Alliance Energy Services, LLC, knowingly discharged oil from the offshore platform known as Vermillion 124F into the Gulf of Mexico (GOM) in 2016.Black Elk Trust operated the Vermillion 124F platform located on a Federal lease in the GOM and hired Montco Oilfield Contractors, LLC, to perform work on the offshore platform. Montco hired Alliance as a subcontractor to perform plugging and abandonment operations associated with the platform.We conducted a joint investigation with the Environmental Protection Agency’s Criminal Investigation Division and found that Shumaker discharged oil mixed with produced water into the GOM from a “gas buster” tank located on the Vermillion 124F platform. Shumaker discharged the fluid over the objection of another concerned employee. Shumaker also discussed the discharge with Thomas Wharton, Montco’s company representative in charge of the platform and the individual who had ultimate work authority. Because of his position, Wharton was legally responsible for reporting the discharge to Federal authorities, but he failed to do so.The U.S. Attorney’s Office, U.S. Department of Justice, prosecuted this matter in the United States District Court for the Western District of Louisiana. As a result, Shumaker pleaded guilty to a violation of 33 U.S.C § 1319(c)(1)(A), “Negligent Violation of the Clean Water Act,” and on December 14, 2020, he was sentenced to 1 year of probation, issued a $2,500 fine, and issued a $25 special assessment. Wharton pleaded guilty to a violation of 33 U.S.C. § 1321(b)(5), “Failure to Notify Authorities Under the Oil Pollution Act,” and on December 7, 2020, he was sentenced to 24 months of probation, issued a $10,000 fine, and issued a $100 special assessment.

Hootan Melamed, a pharmacist based in Los Angeles, California, was sentenced in United States District Court, Southern District of California, on March 29, 2021, to six months in prison and three years’ probation for conspiracy to commit health care fraud. Melamed was also ordered to forfeit $1,816,038.82 in cash and personal property.Our investigation found that Melamed paid kickbacks to medical marketers who referred patients to his pharmacy to fill the patients’ prescriptions for compound creams and other pharmaceuticals. Melamed previously pleaded guilty on November 2, 2020, to the conspiracy charges. As a result of the scheme, Amtrak’s insurance providers were fraudulently charged approximately $22,000. Criminal judicial proceedings for other defendants in this case are pending.

The OIG investigated allegations that Bureau of Indian Affairs (BIA) realty specialists processed and approved 15 land transfer gift deeds from a tribal member to his sister without the proper authority. The complaint also alleged that the deeds contained forged signatures and improperly backdated documents.We confirmed the realty specialists processed the gift deeds for the tribal member, and we found that they did not follow the BIA’s delegation of authority procedures and issued the gift deeds without proper review and approval.The BIA later processed corrections to two of these gift deeds. We established that the tribal member signed the 15 original gift deeds, but we could not determine who signed the corrected documents. We noted significant differences between the signatures on the original documents and the signatures on the corrected documents.We also collected contradictory statements about the corrected documents from the tribal member and the realty specialists involved. In addition, we confirmed that realty specialists improperly backdated the corrections to the gift deeds.The BIA ultimately determined the gift deeds were not properly authorized and voided all the transactions.

Lauren Jones, a former Hertz employee in Chicago, Illinois, pleaded guilty in Circuit Court of Cook County on March 24, 2021, to felony theft charges and was sentenced to two years’ probation on the same date. Our investigation found that Jones stole validated parking passes for the Chicago Union Station parking garage, valued at over $500, from Hertz. In addition, three other individuals were previously charged and convicted of theft charges in this investigation.

The OIG investigated allegations that independent Government contractors colluded on bids for Bureau of Land Management (BLM) hay delivery contracts, that a BLM employee who was related to one of the contractors influenced the awards to benefit the relative, and that the contractors added weight to hay deliveries by watering the hay before delivering it to the BLM on contracts paid by the ton.We substantiated that one contractor assisted another contractor with bid packages for five separate contract solicitations from 2016 to 2019, but the evidence did not establish that they intended to work together on the contracts or that they discussed or developed the pricing component of their independent bids. BLM contract personnel detected the similarities between the bid packages before award and excluded both contractors from the contracts in question.We found no evidence the BLM employee attempted to influence the awards to benefit a relative. We also found no evidence that the contractors added weight to hay deliveries to the BLM.

We investigated an allegation that a senior USGS manager retaliated against a subordinate employee because the employee had participated in another investigation against him.We determined that the employee’s role in the other investigation against the senior manager constituted protected activity, but the evidence did not show that the senior manager knew of the employee’s involvement in that investigation. Accordingly, the evidence did not support a finding that the senior manager retaliated against the employee in violation of the Whistleblower Protection Act.

The OIG investigated allegations that a salable mineral known as caliche was improperly removed from the construction site of a school built on Bureau of Land Management (BLM) land that was conveyed to the school district through a recreation and public purposes lease. The U.S. Government retains the mineral rights in this type of lease and must be compensated if salable minerals are removed.We found that the BLM was aware of the alleged theft for more than 4 years but failed to resolve the complainant’s allegations. Furthermore, we believe the BLM may have violated the National Environmental Policy Act because we found no evidence the BLM completed a required mineral potential report as part of an environmental assessment. This step should have identified caliche as a salable mineral and alerted the BLM to the need to review its proposed disposition before the lease was signed.Our investigation also confirmed that a subcontractor retained by the school removed caliche from the construction site. The BLM, however, did not receive payment, and the Government incurred an estimated loss of $195,976. As a result of our investigation, and more than 4 years after the original complaint was made, the BLM issued a trespass notice to the subcontractor to resolve the unauthorized removal of caliche.Finally, we determined the BLM may have violated Federal regulations when it conveyed 41.24 acres of Federal land to the school district, even though the school intended to use only about 10 acres and had no plans to expand.We presented our investigative findings to the U.S. Attorney’s Office for the District of New Mexico, which declined to prosecute the matter.

Statistics on employee integrity investigation cases closed during the semiannual reporting period for FY 2018, as well as summaries of the cases.

Statistics on employee integrity investigation cases closed during the semiannual reporting period for FY 2019, as well as summaries of the cases.

Statistics on employee integrity investigation cases closed during the semiannual reporting period for FY 2020, as well as summaries of the cases.

Statistics on employee integrity investigation cases closed during the semiannual reporting period for FY 2017, as well as summaries of the cases.