- The Washington Times - Friday, May 21, 2010

An investigation that found thousands of dollars in unauthorized purchases of clothing, gold coins, flat-screen televisions, gym memberships and college tuition payments by employees of the Federal Protective Services using government purchase cards has resulted in no disciplinary action.

Twenty-one FPS employees took advantage of an 18-month transition period during which the security agency was moved from the General Services Administration to the Department of Homeland Security “to loot GSA resources by purchasing unauthorized goods,” according to the GSA’s office of inspector general.

Investigative documents obtained by The Washington Times through a Freedom of Information Act request said the California-based FPS employees used the government cards to buy, among other things, $17,000 in suits at Macy’s and the Men’s Wearhouse, $15,000 in gold and silver coins, $60,000 in tuition payments and professional memberships, and $8,000 in gym memberships in 2003 and 2004.

The FPS employees, who are responsible for securing federal buildings, also used expense vouchers to get reimbursements for more than $9,000 in clothing, including an $800 tuxedo.

Investigators said employees with the security force bought the questionable items but concealed them by not entering them into the government computer system known as “Pegasys,” which processes and reconciles financial transactions.

The purchases were the subject of an investigation by the inspector general’s office that spanned five years. In September, investigators closed the case and noted that of the 21 employees involved in making the inappropriate purchases, three resigned and four retired. Five employees faced a possible reprimand and no action had been taken against nine others.

Leslie Paige, a spokeswoman for the nonpartisan Citizens Against Government Waste, said it was appalling that no discipline had been handed down by GSA or Homeland Security.

“These are law-enforcement officers who are engaged in outright theft. This is not complicated,” Ms. Paige said.

“If anyone were to read this report they would smell a rat,” she said. “No dime of recovery, no one went after anyone. This is fraud. It’s abuse.”

The case has resulted in no criminal charges, though it was twice referred to federal prosecutors.

Investigators at the inspector general’s office said that in 2005, the U.S. attorney’s office for the Central District of California declined to prosecute, concluding that the FPS employees interviewed in the case had not been appropriately advised of their rights and the interviews of them were “tainted.”

In 2008, the case was again presented to prosecutors - this time without the interviews - but the U.S. attorney’s office again declined to file charges. The prosecutors said the FPS employees had been authorized by a supervisor to make the purchases and the supervisor who approved them had since retired, according to investigators.

An FPS spokesman did not return a call for comment. A spokesman for the GSA’s inspector general’s office, which authored the report, referred questions about attempts to recover the money, among other things, to the inspector general’s office at Homeland Security. That office said follow-up questions would have to be asked through a Freedom of Information Act request.

A government purchase card is an internationally accepted credit card available to personnel in all federal agencies under a single GSA contract. The cards are designed to minimize the paperwork needed to make, with proper authorization, purchases of up to $25,000.

Although the cards provide efficiency, they have proved to be high risk, according to a report by the President’s Council on Integrity and Efficiency, since they allow the same person to order, pay for and receive goods and services - which the council said allows for the “potential for fraud and abusive and improper transactions if not carefully monitored.”

The GSA investigative memos obtained by The Times say the FPS investigation began after government monitors detected in 2004 the unauthorized purchase of a suit on a government credit card from a Nordstrom clothing store in the Los Angeles area.

When confronted about the purchases, investigators said FPS employees told them “they no longer reported to GSA and were therefore not subject to the GSA requirement.”

The employees said they received verbal authorization to buy items including clothing, souvenir coins, pen sets and athletic shoes. Investigators said only a few of the employees questioned the issue or asked for written authorization.

An FPS regional deputy director told investigators that the suits were purchased for inspectors, whose jobs sometimes bring them into contact with tenants in public buildings or with federal judges and magistrates. Inspectors are permitted to wear business suits for such meetings or when escorting dignitaries, but those suits are not provided at government expense.

The suit purchases were later extended to other classes of employees until at one point, the FPS regional deputy director ordered that $1,500 be set aside per employee for the purchase of clothing.

One employee, identified only as a 15-year veteran of the GSA’s office of inspector general, challenged the supervisor who authorized the purchases on whether the expenses were permitted but was overruled.

Established in 1971, FPS employs a staff of about 1,225 - 900 of whom serve in law-enforcement capacities - and oversees about 15,000 contract guards to secure 9,000 buildings nationwide.

• Matthew Cella can be reached at mcella@washingtontimes.com.

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