Video: Katrina workers fraud uncovered

updated 7/19/2006 7:39:29 PM ET 2006-07-19T23:39:29

The Homeland Security Department wasted hundreds of thousands of dollars last year on iPods, dog booties, beer-making equipment and designer jackets, congressional investigators have concluded.

More than 100 laptop computers and a dozen boats also bought by Homeland Security employees are missing, the investigators found.

Poor training, lax oversight and rampant confusion over what employees are allowed to buy with government-issued purchase cards left Homeland Security "vulnerable to fraud, waste and abuse," according to a draft report by the Government Accountability Office, Congress' investigative and auditing arm.

The report was to be released Wednesday by a Senate panel that oversees the department.

Senators said more than 10,000 Homeland Security employees carry purchase cards for business-related expenses — with a spending limit that was raised to $250,000 for emergencies after Hurricane Katrina hit last Aug. 29. Aides said the audit covered expenses for a five-month period both before and after Katrina.

Investigators: Scant training, lax supervision
But investigators found that employees received scant training on how to use the cards, were given little or lax supervision and were told to follow spending guidelines that differed among the 22 agencies that make up the department.

The department spent $435 million with the purchase cards in the 2005 budget year, compared with $296 million in 2004, Homeland Security spokesman Russ Knocke said Tuesday evening. But he said only a fraction of the expenses were improper, noting that the department has disciplined about 70 employees amid 1.1 million purchases.

"Comparatively, we're talking about a small number of bad apples," Knocke said.

Among the expenses that investigators described as abusive or otherwise questionable:

  • More than 2,000 sets of dog booties, costing $68,442, that have sat unused in storage since emergency responders decided they were not suited for canines assisting in Gulf Coast recovery efforts.
  • Three portable shower units for $71,170 from a contractor who investigators said overcharged the government. Customs and Border Protection agents could have gotten similar showers for nearly a third of the price — and faster.
  • 12 Apple iPod Nanos and 42 iPod Shuffles, worth $7,000, for Secret Service "training and data storage." Because the Shuffles cost less than $300, the Secret Service said they were not required to track them to ensure they were used properly.
  • 37 black Helly Hansen designer rain jackets, costing nearly $2,500, for use in a firing range that the Customs and Border Protection purchaser later acknowledged shuts down when it's raining.
  • Conference and hotel rooms at a golf and tennis resort at St. Simons Island in Georgia, worth $2,395, for training 32 newly hired attorneys when they could have used a nearby federal law enforcement training center.
  • A beer brewing kit and ingredients for more than $1,000 for a Coast Guard official to brew alcohol while on duty as a social organizer for the U.S. Coast Guard Academy. "The estimated price for a six-pack of USCG beer was $12," the investigators noted, adding: "Given that the six-pack cost of most beers is far less than $12, it is difficult to demonstrate that the Academy is achieving cost savings by brewing its own beer."

Investigators also noted that Customs and Border Protection wasted up to $464,586 by buying meals-ready-to-eat over the Internet instead of contracting through the Pentagon, as is standard procedure. And they found that the Federal Emergency Management Agency cannot locate 107 laptops, 22 printers and two GPS units worth $170,000. FEMA also cannot find 12 of 20 boats the agency bought for $208,000.

Knocke, the Homeland Security spokesman, said the department will begin enforcing new spending guidelines in the next several weeks that should eliminate much of the confusion and make sure buys are strictly supervised. Violators could have their cards taken away, be forced to repay expenses and face disciplinary action, he said. "We take very seriously our responsibility to be good stewards of taxpayer dollars," Knocke said.

The senators who ordered the investigation — Sens. Susan Collins, R-Maine, and Joe Lieberman, D-Conn. — described Homeland Security as negligent in preventing the shopaholics among its ranks. The two lead the Senate's Homeland Security and Governmental Affairs Committee.

Homeland Security "left the door wide open for these abuses," Collins said.

Added Lieberman: "That is hard to believe."

© 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Discuss:

Discussion comments

,

Most active discussions

  1. votes comments
  2. votes comments
  3. votes comments
  4. votes comments