Administration

Joint EU-U.S. Statement Following the EU-U.S. Justice and Home Affairs Ministerial Meeting

Justice -

On 22 June 2021, the Portuguese Presidency of the Council of the European Union hosted the EU-U.S. Ministerial Meeting on Justice and Home Affairs in Lisbon. The United States was represented by the Secretary for Homeland Security Alejandro N. Mayorkas, and by Deputy Assistant Attorney General and DOJ Counselor for International Affairs Bruce Swartz. The European Union, hosting the meeting, was represented by the Vice-President of the European Commission Margaritis Schinas, the Commissioner for Justice Didier Reynders, the Commissioner for Home Affairs Ylva Johansson, as well as the Portuguese Ministers for Justice Francisca Van Dunem and for Home Affairs Eduardo Cabrita, on behalf of the current Presidency of the Council of the European Union. The incoming Presidency of the Council was represented by the Slovenian Minister of the Interior Aleš Hojs.

Virginia Woman Pleads Guilty to Fraudulently Obtaining COVID-Related Unemployment Benefits for Prison Inmates

Homeland Security -OIG -

Virginia Woman Pleads Guilty to Fraudulently Obtaining COVID-Related Unemployment Benefits for Prison Inmates For Information Contact

Public Affairs (202) 254-4100

adrian.edwards Mon, 06/21/2021 - 15:23

For Immediate Release

Friday, June 11, 2021 Download PDF (110.72 KB)

RICHMOND, Va. – A Glen Allen woman pleaded guilty today to mail fraud for her role in a conspiracy to fraudulently obtain pandemic-related unemployment benefits for 22 prison inmates, which she shared with the inmate beneficiaries.

“These critical unemployment funds were intended for deserving members of our communities to help alleviate their economic hardship during the pandemic,” said Raj Parekh, Acting U.S. Attorney for the Eastern District of Virginia. “This prosecution and the defendant’s guilty plea send a clear message that EDVA will bring to justice those who unlawfully exploit taxpayer-funded assistance for personal gain.”

According to court documents, Virginia Smith, 37, conspired with an inmate at Baskerville Correctional Center to collect the personally identifiable information of inmates to fraudulently apply for Virginia unemployment benefits from around June 2020 to January 2021, during the COVID-19 pandemic. Smith, with the assistance of the inmate co-conspirator, submitted successful applications for Virginia unemployment benefits for at least 22 inmates at Baskerville Correctional Center, resulting in the dispersal of at least $223,984.72 in fraudulent benefits.

“Smith and her co-conspirators used the identities of prisoners housed at the Baskerville Correctional Center to file fraudulent unemployment claims and unlawfully collect more than $223,000 in resulting benefit payments,” said Derek Pickle, Special Agent-in-Charge, Washington Region, U.S. Department of Labor Office of Inspector General. “As the primary law enforcement agency responsible for investigating unemployment insurance fraud, the Department of Labor Office of Inspector General is committed to supporting the prosecution of individuals who take advantage of unemployment insurance programs. We are grateful to the U.S. Attorney’s Office, the Virginia Employment Commission, and our law enforcement partners for their invaluable support of our mission.”

“Intentional abuse of COVID-19 unemployment benefits for personal gain is appalling,” said Joseph V. Cuffari, Inspector General for the Department of Homeland Security. “Today’s sentencing illustrates that DHS OIG and our law enforcement partners will work tirelessly to dismantle these greed-driven schemes.”

As part of their scheme, Smith’s co-conspirator would provide her with the names, dates of birth, and Social Security numbers of inmates serving a sentence at Baskerville Correctional Center. Smith would then file unemployment claims with the Virginia Employment Commission using that information. Once the applications were approved, Smith would share the proceeds of the crime with the inmates whose personal information she used to file the fraudulent claims, keeping a portion of the proceeds for herself. The applications contained several false statements such as a false physical address, rather than the address of the correctional facility at which the inmates were actually living; a false last employer; and a false certification that the inmates were ready, willing, and able to work in the event employment became available.

Smith is scheduled to be sentenced on September 9. She faces a maximum penalty of 30 years in prison. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

Raj Parekh, Acting U.S. Attorney for the Eastern District of Virginia; Derek Pickle, Special Agent-in-Charge of the Washington, DC Regional Office, U.S. Department of Labor, Office of Inspector General; Joseph V. Cuffari, Inspector General for the Department of Homeland Security; Jerald W. Page, Special Agent in Charge of the U.S. Secret Service’s Richmond Field Office; and Eric D. English, Chief Henrico County Police Division, made the announcement after U.S. District Judge John A. Gibney, Jr. accepted the plea.

This investigation was conducted under the auspices of “Operation Checkmate,” the Virginia Department of Corrections Inmate Unemployment Insurance Fraud Task Force. The task force is led by the U.S. Attorney’s Office for the Eastern District of Virginia, DOL-OIG, DHS-OIG, and the Virginia Department of Corrections. This investigation included significant assistance from the Virginia Employment Commission.

Assistant U.S. Attorney Kashan Pathan is prosecuting the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:21-cr-60.

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DHS Office of the Inspector General, www.oig.dhs.gov

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Former CEO Sentenced for Defrauding Multiple Federal Agencies

Homeland Security -OIG -

Former CEO Sentenced for Defrauding Multiple Federal Agencies For Information Contact

Public Affairs (202) 254-4100

adrian.edwards Mon, 06/21/2021 - 15:03

For Immediate Release

Wednesday, June 16, 2021 Download PDF (116.08 KB)

ALEXANDRIA, Va. – An Arlington businessman was sentenced today to 21 months in prison with three years of supervised release for making false statements to multiple federal agencies in order to fraudulently obtain multimillion-dollar government contracts, COVID-19 emergency relief loans, and undeserved military service benefits.

“In the early stages of the global pandemic, the defendant engaged in three egregious fraudulent schemes that he brazenly concocted to enrich himself,” said Raj Parekh, Acting U.S. Attorney for the Eastern District of Virginia. “He falsely represented to the federal government that he could provide $38 million in life-saving N95 masks, and simultaneously, he fraudulently obtained over $1 million in pandemic assistance intended for deserving families and businesses. The defendant also continued an offensive seven-year scheme to obtain unearned veterans benefits by falsely claiming to have served as a Marine. This case underscores our commitment to holding accountable those who exploit essential government programs at the expense of veterans, front-line medical personnel, and vulnerable members of our communities.”

According to court documents, Robert S. Stewart, Jr., 35, was the owner and president of Federal Government Experts (FGE) LLC, an Arlington-based company that purported to provide various services to the U.S. government. In this capacity, between April 1, 2020 and May 14, 2020, Stewart made false statements to the Federal Emergency Management Agency (FEMA) and the Department of Veterans Affairs (VA) in order to obtain lucrative contracts to provide COVID-19 personal protective equipment (PPE). In addition, Stewart fraudulently obtained loans under the federal Paycheck Protection Program and the Economic Injury Disaster Loan Program. He also defrauded the VA by falsely claiming to be entitled to veteran’s benefits for serving in the U.S. Marine Corps when, in fact, he never served in the Marines.

As part of his PPE scheme, Stewart falsely stated to procurement officials from FEMA and the VA that he was in possession of large quantities of PPE, including N95 masks. Based on Stewart’s false statements, the VA and FEMA awarded FGE contracts valued at $35,000,000 and $3,510,000, respectively. The VA intended to use the PPE purchased from FGE to protect employees and patients at various Veterans Health Administration facilities, which serve the medical needs of over nine million veterans each year. FGE failed to supply any PPE to the VA and FEMA. The U.S. government suffered no financial loss because the contract called for payment upon delivery and inspection of the goods.

“These were crimes against the American people. Stewart fraudulently pursued contracts that were needed to supply VA hospital patients and staff with critical personal protective equipment during the COVID-19 pandemic, and stole taxpayer dollars intended to help local businesses stay afloat during the pandemic. In addition, he lied about his service in the military and received veterans benefits for which he was not entitled,” said VA Inspector General Michael J. Missal. “This sentence should send a clear message that the VA Office of Inspector General will work diligently with its law enforcement partners to ensure those who would defraud the nation’s veterans and the public will be caught and prosecuted.”

“We continue to collaborate with our law enforcement partners to pursue and dismantle schemes aimed at exploiting critical COVID-19 resources, and we are grateful for today’s sentencing decision, which sends a strong message to help deter potential fraudsters,” said Joseph V. Cuffari, Inspector General for the Department of Homeland Security (DHS).

“Today’s sentencing shows that we will not allow criminals to get away with exploiting government relief efforts that were designed to assist millions of Americans during the COVID-19 pandemic. Stewart fraudulently obtained government-backed loans, and his nefarious and unethical actions were for his own personal gain,” said Robert E. Bornstein, Acting Special Agent in Charge of FBI’s Washington Field Office Criminal Division. “The FBI and our partners are committed to protecting the American people and the integrity of government assistance programs and will work to identify, arrest, and prosecute those who choose criminal activity and greed over principle and the law.”

Stewart also applied for various loans on behalf of FGE under the federal Paycheck Protection Program and the Economic Injury Disaster Loan Program. These programs were designed to provide emergency financial assistance to the millions of people suffering the economic effects of the COVID-19 pandemic. The loan applications submitted by Stewart falsely overstated the number of FGE employees and the amount of FGE’s payroll, two factors that were important in determining loan eligibility and the proper amount of the loan. In addition, Stewart used some of the loan proceeds for personal expenditures rather than to pay employees or for other appropriate business expenses. As a result of these fraudulent loan applications, Stewart obtained approximately $1,066,000 in government-backed loans during the pandemic.

In a separate fraudulent scheme, Stewart, an Air Force veteran, submitted an application for benefits to the VA. The application was fraudulent in that Stewart falsely claimed that he also served in the U.S. Marine Corps. Stewart created fraudulent documents that stated he attained the rank of Corporal in the Marine Corps and was honorably discharged after receiving several awards and commendations, including the Rifle Expert Badge, Pistol Expert Badge, Meritorious Mast, National Defense Service Medal, Sea Service Deployment Ribbon, Southwest Asia Service Medal, Certificate of Appreciation, and the Kuwaiti Liberation Medal. Stewart, in fact, never served in the Marines. Based on his fraudulent application, he received excess benefits in the amount of $73,722.45 between September 2013 and October 2020.

Raj Parekh, Acting U.S. Attorney for the Eastern District of Virginia; Robert E. Bornstein, Acting Special Agent in Charge of FBI Washington Field Office Criminal Division; Joseph V. Cuffari, Inspector General for the Department of Homeland Security (DHS); and Michael J. Missal, Inspector General for the U.S. Department of Veterans Affairs, made the announcement after sentencing by U.S. District Judge Rossie D. Alston, Jr.

Assistant U.S. Attorney William Fitzpatrick prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:21-cr-5.

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DHS Office of the Inspector General, www.oig.dhs.gov

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GAO Comments on AICPA Proposed SAS – Inquiries of the Predecessor Auditor Regarding Fraud and Noncompliance With Laws and Regulations

GAO - OIG -

This letter provides GAO's response to the American Institute of Certified Public Accountants' (AICPA) Auditing Standards Board's (ASB) exposure draft, Proposed Statement on Auditing Standards – Inquiries of the Predecessor Auditor Regarding Fraud and Noncompliance With Laws and Regulations. GAO provides standards for performing high-quality audits of governmental organizations, programs, activities, and functions and of government assistance received by contractors, nonprofit organizations, and other nongovernmental organizations with competence, integrity, objectivity, and independence. These standards, often referred to as generally accepted government auditing standards (GAGAS), are to be followed when required by law, regulation, agreement, contract, or policy. For financial audits, GAGAS incorporates by reference the AICPA's Statements on Auditing Standards (SAS).

Independence Day Celebrations: Estimated Costs and COVID-19 Protective Measures for 2020 Fourth of July Events

GAO - OIG -

What GAO Found Federal agencies and state and local jurisdictions combined spent millions of dollars for the estimated costs of 2020 Fourth of July events in Washington, D.C., and at Mount Rushmore. The various federal agencies involved in the events included the United States Capitol Police; the Executive Office of the President; and the Departments of the Interior, Defense, Homeland Security, and Health and Human Services. Beyond the federal effort, the District of Columbia Government (DC Government), the state of South Dakota, and local law enforcement played a role in the events. Fourth of July Estimated Costs for Events in 2020 Event Estimated costs (dollars) General event costs a 2,610,164 A Capitol Fourth Concert 3,888,607 Independence Day fireworks 2,546,737 Salute to America 1,610,811 Mount Rushmore National Memorial Events 3,917,289 Total 14,573,608 Source: GAO analysis of estimated cost data provided by federal agencies and state and local jurisdictions. | GAO-21-458 aGeneral event costs are those that cannot be attributed to a specific event. Costs incurred were associated with contracts, equipment, and federal personnel, such as costs for overtime pay. Officials GAO interviewed from federal agencies and state and local jurisdictions said they did not incur COVID-19 mitigation costs for the events because personal protective equipment (PPE) and other related supplies used were from existing stockpiles. Federal agencies and the DC Government primarily used annual appropriations to fund the events. The National Park Service also used the Centennial Challenge and Federal Lands Recreation Enhancement Act appropriation accounts to fund portions of the Salute to America and Mount Rushmore events and to cover costs incurred as part of the fireworks display. The DC Government used funds from other available appropriations to cover the cost of events occurring after the obligation of its $18 million appropriation for fiscal year 2020 security costs, including the $1.4 million estimated cost of the 2020 Fourth of July events. The United States Park Police reimbursed state and local jurisdictions outside of Washington, D.C., $35,057 for their costs associated with the events in the District. During the 2020 Fourth of July events, Centers for Disease Control and Prevention–issued federal guidelines as well as state and local guidelines that South Dakota and Washington, D.C., issued were in effect. These guidelines encouraged event organizers and the public to take a variety of steps to help prevent the spread of COVID-19. Events held on federal property in Washington, D.C., were to follow federal guidelines that included recommendations for social distancing of 6 feet, use of cloth face coverings, and frequent handwashing. South Dakota state guidance was in effect for the events at the Mount Rushmore National Memorial. Federal agencies and state and local jurisdictions instructed their employees to follow relevant COVID-19 guidance and provided employees with PPE. In addition, federal and state agencies made PPE, such as masks, available to the public. Why GAO Did This Study Since July 4, 1776, Americans have celebrated Independence Day through events held in towns and cities across the nation. In the nation's capital, Washington, D.C., visitors have celebrated on the National Mall with federally sponsored parades, concerts, fireworks, and in 2019 the Salute to America. In 2020, additional federally sponsored activities were held at the Mount Rushmore National Memorial in South Dakota. Because of the COVID-19 pandemic, federal Fourth of July celebrations in 2020 required adjustments and precautions in order to mitigate the spread of COVID-19. GAO was asked to review the estimated costs associated with the 2020 Fourth of July events and describe protective measures taken because of COVID-19. This report describes (1) the total estimated costs that federal agencies and state and local jurisdictions incurred for federal 2020 Fourth of July events, the appropriations used to pay the federal costs, and the extent to which the federal government reimbursed costs incurred by state and local jurisdictions and (2) the protective measures that federal agencies and state jurisdictions took to help ensure the health and safety of the public, federal employees, and other essential workers at the events. To perform this work, GAO reviewed documentation and interviewed personnel from federal agencies and state and local jurisdictions about their estimated costs and actions at the events in response to the COVID-19 pandemic. For more information, contact Kristen Kociolek at (202) 512-2989 or kociolekk@gao.gov.

Defense Cybersecurity: Defense Logistics Agency Needs to Address Risk Management Deficiencies in Inventory Systems

GAO - OIG -

What GAO Found For six selected inventory management systems that support processes for procuring, cataloging, distributing, and disposing of materiel, the Defense Logistics Agency (DLA) fully addressed two of the Department of Defense's (DOD) six cybersecurity risk management steps and partially addressed the other four. Specifically, the agency categorized the systems based on risk and established an implementation approach for security controls. However, it only partially addressed the four risk management steps of selecting, assessing, authorizing, and monitoring security controls (see figure). Extent to Which the Defense Logistics Agency Addressed the Department of Defense's Risk Management Steps for Six Selected Inventory Management Systems • Select security controls : DLA selected specific security controls, but it did not develop system-level monitoring strategies to assess the effectiveness of selected security controls for three of the six systems GAO assessed. DOD's risk management framework requires components to develop a system-specific monitoring strategy during the security control selection step. • Assess security controls : DLA assessed the security controls for the six selected inventory management systems, but its assessment procedures lacked approvals, as required. As a result, GAO found that DLA's assessment plans lacked essential details and missed opportunities for risk-based decisions. • Authorize the system : DLA authorized the selected systems, but it did not report complete and consistent security and risk assessment information to support decisions. GAO found that DLA had not established a process for program offices to review authorization documentation prior to submitting packages to the authorizing official. • Monitor security controls : DLA did not consistently monitor the remediation of identified security weaknesses across its six inventory management systems. As a result, GAO found that 1,115 of the 1,627 corrective action plans (69 percent) for the six systems did not complete intended remediation within DLA's required time frame of 365 days or less--they were ongoing for an average of 485 days. Until DLA addresses the identified deficiencies, the agency's management of cyber risks for critical systems will be impeded and potentially pose risks to other DOD systems that could be accessed if DLA's systems are compromised. Why GAO Did This Study In November 2018 DOD's Survivable Logistics Task Force examined current and emerging threats to DOD logistics, including cybersecurity threats. The task force concluded that DOD's inventory management systems were potentially vulnerable to cyberattacks, and that DOD did not have corrective action plans to mitigate the potential risks posed by associated vulnerabilities. House Report 116-120, accompanying a bill for the National Defense Authorization Act for Fiscal Year 2020, included a provision for GAO to evaluate DOD's efforts to manage cybersecurity risks to the DOD supply chain. GAO's report determines the extent to which DLA has implemented risk management steps to address cybersecurity risks to its inventory management systems. GAO selected six systems that DLA officials deemed critical to inventory management operations. GAO reviewed documents, analyzed data, and interviewed officials to determine whether DLA fully addressed, partially addressed, or did not address DOD steps for cybersecurity risk management.

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