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Army incurred costly delays on construction of Texas hospital

The Army’s delays and added work orders for construction improvements for a hospital at Fort Bliss, Texas, cost the Defense Department more than $32.1 million, according to a new report from the inspector general.

The watchdog faulted the U.S. Army Corps of Engineers and Defense Health Agency for a lack of guidance on reporting of expenditures.

An audit of the continuing construction of the Fort Bliss Hospital Replacement project was required under the fiscal 2018 National Defense Authorization Act.  When complete, it will be a 1.13 million square foot-facility housing 135 hospital beds, 10 operating rooms and 30 specialty clinics, plus an administrative building, a research building, a central utility plant, two access control points and surface parking.

Keep reading this article at: https://www.govexec.com/defense/2018/06/army-incurred-costly-delays-construction-texas-hospital/148899/

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COR sentenced to prison for soliciting $320,000 in bribes from Afghan contractors

A former employee of the U.S. Army Corps of Engineers (USACE) based in Afghanistan was sentenced on Mar. 8, 2018 to 100 months in prison for soliciting approximately $320,000 in bribes from Afghan contractors in return for his assistance in U.S. government contracts.

Mark E. Miller, 49, of Springfield, Illinois was also ordered to serve three years of supervised release following his prison sentence and forfeit $180,000 and a Harley-Davidson motorcycle.  Miller previously pleaded guilty to a one-count information charging him with seeking and receiving bribes.

Miller admitted worked for the USACE from 2005 until 2015, including in Afghanistan from 2009 to 2012, and maintained a residence in Springfield during that time.  From February 2009 to October 2011, Miller was assigned to a military base, Camp Clark, in eastern Afghanistan.  He was the site manager and a contracting officer representative (COR) for a number of construction projects in Afghanistan.

On Dec. 10, 2009, the USACE awarded a contract worth approximately $2.9 million to an Afghan construction company for the construction of a road from eastern Afghanistan to the Pakistani border.  This contract later increased in value to approximately $8,142,300.  Miller oversaw the work of the Afghan company on this road project, including verifying that the company performed the work called for by the contract and, if so, authorizing progress payments to the company by the USACE.

As part of his guilty plea, Miller admitted that, in the course of overseeing the contract with the Afghan company, he solicited from the owners of the company approximately $280,000 in bribes in return for making things easier for the company on the road project, including making sure the contract moved along and was not terminated.  He further admitted that, after the contract was no longer active, he solicited an additional $40,000 in bribes in return for the possibility of future contract work and other benefits.

This matter was investigated by the Federal Bureau of Investigation, the Defense Criminal Investigative Service, the Special Inspector General for Afghanistan Reconstruction, and the U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit, with assistance from the U.S. Postal Inspection Service, Fort Worth Division.  The Dept. of Justice Criminal Division’s Fraud Section and the U.S. Attorney’s office of the Central District of Illinois prosecuted this case.

Source: https://www.justice.gov/opa/pr/former-employee-us-army-corps-engineers-afghanistan-sentenced-prison-soliciting-approximately

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Massive Pentagon agency lost track of hundreds of millions of dollars

One of the Pentagon’s largest agencies can’t account for hundreds of millions of dollars’ worth of spending, a leading accounting firm says in an internal audit obtained by POLITICO that arrives just as President Donald Trump is proposing a boost in the military budget.

Ernst & Young found that the Defense Logistics Agency (DLA) failed to properly document more than $800 million in construction projects, just one of a series of examples where it lacks a paper trail for millions of dollars in property and equipment. Across the board, its financial management is so weak that its leaders and oversight bodies have no reliable way to track the huge sums it’s responsible for, the firm warned in its initial audit of the massive Pentagon purchasing agent.

The audit raises new questions about whether the Defense Department can responsibly manage its $700 billion annual budget — let alone the additional billions that Trump plans to propose this month. The department has never undergone a full audit despite a congressional mandate — and to some lawmakers, the messy state of the Defense Logistics Agency’s books indicates one may never even be possible.

Keep reading this article at: https://www.politico.com/story/2018/02/05/pentagon-logistics-agency-review-funds-322860

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COR pleads guilty to soliciting $320,000 in bribes from contractors

A former employee of the U.S. Army Corps of Engineers (USACE) based in Afghanistan pleaded guilty yesterday (July 25, 2017)  to soliciting approximately $320,000 in bribes from Afghan contractors in return for his assistance in U.S. government contracts.

Mark E. Miller, 48, a Contracting Officer’s Representative (COR) with the United States Army Corps of Engineers (USACE), pleaded guilty before a U.S. Magistrate Judge in Springfield, Illinois.  Miller is scheduled to be sentenced on November 30, by U.S. District Judge Richard H. Mills.

During the court hearing, Miller testified that he worked for the USACE from 2005 until 2015, including in Afghanistan from 2009 to 2012.  From February 2009 to October 2011, Miller was assigned to a military base, Camp Clark, in eastern Afghanistan.  While in Afghanistan, Miller was the site manager and a COR for a number of construction projects.

Miller testified to the fact that on Dec. 10, 2009, the USACE awarded a contract worth approximately $2.9 million to an Afghan construction company for the construction of a road from eastern Afghanistan to the Pakistani border.  This contract later increased in value to approximately $8,142,300.  Miller oversaw the work of the Afghan company on this road project, including verifying that the company performed the work called for by the contract and authorizing progress payments to the company by the USACE.

Miller admitted that, in the course of overseeing the contract with the Afghan company, he solicited approximately $280,000 in bribes from the owners of the company, in return for assisting the company in connection with the road project, including making sure the contract was not terminated.  Miller further admitted that, after the contract was no longer active, he solicited an additional $40,000 in bribes in return for the possibility of future contract work and other benefits.

This matter was investigated by the FBI, the Defense Contract Investigative Service, the Special Inspector General for Afghanistan Reconstruction (SIGAR), and the Army’s Criminal Investigation Command.

Source: https://www.justice.gov/opa/pr/former-employee-us-army-corps-engineers-afghanistan-pleads-guilty-soliciting-approximately

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Price reasonableness determinations for FSS supply orders by Army’s Huntsville operation need improvement

The Inspector General (IG) of Department of Defense (DoD) reports that contracting personnel at the U.S. Army Engineering and Support Center, Huntsville (CEHNC) did not adequately document and support their price reasonableness determinations for 25 Federal Supply Schedule (FSS) orders, valued at $10 million.

CEHNCThe IG reviewed a total, non-statistical sample of 33 orders, valued at $13.6 million.  The IG’s office determined that CEHNC contracting personnel relied on:

  • Inadequate independent Government estimates for all 25 orders. This occurred because they relied on the expertise of the preparers of the Independent Government Estimates (IGEs) rather than having the preparers document and support the basis of the estimate as required by the Army Federal Acquisition Regulation Supplement and U.S. Army Corps of Engineers guidance. In addition, while the contracting officers stated that they took training on preparing IGEs, they did not document that they completed that training.
  • Vendor quotes were eliminated from consideration for technical reasons for 7 of the 25, valued at $3 million, without verifying whether the prices were still valid for comparison purposes. The contracting officer involved in the actions admitted that this was an oversight.
  • CEHNC contracting personnel relied on price reasonableness determinations that were not approved until after the award of 4, valued at $1.76 million, of the 33 orders. Again, the contracting officer stated that this was an oversight.

Bottom line, the IG determined that CEHNC did not have guidance requiring contracting personnel to approve price reasonableness determinations before awarding orders. As a result, CEHNC’s customers may have paid more than they should have for the supplies purchased.

In its report, the IG recommend that:

  • Refresher training be conducted, detailing contracting officer’s responsibilities for developing, reviewing, and approving IGE’s;
  • Completion of such training by contracting personnel be documented;
  • Guidance be developed and implemented requiring contracting personnel to verify that the prices from quotes eliminated for technical reasons are valid for comparison purposes when making price reasonableness determinations; and
  • Guidance be developed and implemented requiring contracting personnel to approve price reasonableness determinations before awarding orders.

The IG’s complete report can be viewed at: http://www.dodig.mil/pubs/documents/DODIG-2016-069.pdf 

 

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