In October 2006, the Department of Justice announced a new national procurement fraud initiative established by the Criminal Division to promote the early detection, prevention, and prosecution of procurement and grant fraud associated with increased contracting activity for national security and other government programs. In partnership with U.S. Attorneys’ Offices, the Justice Department’s Antitrust, Civil, Environmental and Natural Resources, National Security, and Tax Divisions, and other federal law enforcement agencies, the Department formed the National Procurement Fraud Task Force, chaired by the Assistant Attorney General of the Criminal Division, to intensify the government’s detection efforts and to continue prosecuting those who defraud taxpayers. The Executive Director of the Task Force is Steve A. Linick, who spearheaded a procurement fraud task force in the Eastern District of Virginia and is now a Deputy Chief in the Department’s Criminal Division, Fraud Section. Brian Miller, the IG for GSA, is the Vice-Chair of the Task Force.
What agencies are members of the Task Force?
TASK FORCE MEMBERS
The National Procurement Task Force includes the following members:
• AIR FORCE OFFICE OF SPECIAL INVESTIGATIONS (USAF-OSI)
• ANTITRUST DIVISION, DEPARTMENT OF JUSTICE (DOJ)
• ARMY CRIMINAL INVESTIGATION COMMAND (ARMY CID)
• ARMY, LEGAL SERVICES AGENCY
• CIVIL DIVISION, DOJ
• CRIMINAL DIVISION, DOJ
• DEFENSE CONTRACT AUDIT AGENCY (DCAA)
• DEFENSE CRIMINAL INVESTIGATIVE SERVICE (DCIS)
• DEFENSE CONTRACT MANAGEMENT AGENCY (DCMA)
• ENVIRONMENT AND NATURAL RESOURCES DIVISION, DOJ (ENRD)
• EXECUTIVE OFFICE FOR U.S. ATTORNEYS, DOJ (EOUSA)
• FEDERAL BUREAU OF INVESTIGATION (FBI)
• FEDERAL LAW ENFORCEMENT TRAINING CENTER (FLETC)
• INTERNAL REVENUE SERVICE, CRIMINAL INVESTIGATION (IRS-CI)
• NAVAL CRIMINAL INVESTIGATIVE SERVICE (NCIS)
• NATIONAL SECURITY DIVISION, DOJ
• OFFICE OF MANAGEMENT AND BUDGET (OMB), OFFICE OF FEDERAL PROCUREMENT POLICY (OFPP)
• TAX DIVISION, DOJ
• U.S. ATTORNEYS’ OFFICES (USAOS)
• UNITED STATES POSTAL INSPECTION SERVICE (USPIS) AND Inspectors General (OIG), including:
• AGENCY FOR INTERNATIONAL DEVELOPMENT (USAID)
• AMTRAK
• CENTRAL INTELLIGENCE AGENCY (CIA)
• CORPORATION FOR NATIONAL AND COMMUNITY SERVICE (CNCS)
• DEFENSE INTELLIGENCE AGENCY (DIA)
• DEPARTMENT OF AGRICULTURE (USDA)
• DEPARTMENT OF COMMERCE (DOC)
• DEPARTMENT OF DEFENSE (DOD)
• DEPARTMENT OF EDUCATION (EDUCATION)
• DEPARTMENT OF ENERGY (DOE)
• DEPARTMENT OF HEALTH AND HUMAN SERVICES (HHS)
• DEPARTMENT OF HOMELAND SECURITY (DHS)
• DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (HUD)
• DEPARTMENT OF INTERIOR (INTERIOR)
• DEPARTMENT OF JUSTICE (DOJ)
• DEPARTMENT OF LABOR (DOL)
• DEPARTMENT OF STATE (DOS)
• DEPARTMENT OF TRANSPORTATION (DOT)
• DEPARTMENT OF THE TREASURY (TREASURY)
• DEPARTMENT OF VETERANS AFFAIRS (VA)
• ENVIRONMENTAL PROTECTION AGENCY (EPA)
• GENERAL SERVICES ADMINISTRATION (GSA)
• GOVERNMENT PRINTING OFFICE (GPO),
• NATIONAL AERONAUTICS AND SPACE ADMINISTRATION (NASA)
• NATIONAL GEOSPATIAL INTELLIGENCE AGENCY (NGA)
• NATIONAL RECONNAISSANCE OFFICE (NRO)
• NATIONAL SCIENCE FOUNDATION (NSF)
• NATIONAL SECURITY AGENCY (NSA)
• NUCLEAR REGULATORY COMMISSION (NRC)
• OFFICE OF THE DIRECTOR OF NATIONAL INTELLIGENCE (ODNI)
• SMALL BUSINESS ADMINISTRATION (SBA)
• SOCIAL SECURITY ADMINISTRATION (SSA)
• SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION (SIGIR)
• SPECIAL INSPECTOR GENERAL FOR AFGHANISTAN RECONSTRUCTION (SIGAR)
• TENNESSEE VALLEY AUTHORITY (TVA)
• TREASURY INSPECTOR GENERAL FOR TAX ADMINISTRATION (TIGTA)
• UNITED STATES POSTAL SERVICE (USPS)
What are the stated objectives of the Task Force?
The Task Force has established the following objectives relating to procurement fraud:
1) Increase coordination and strengthen partnerships among all IGs, law enforcement, and DOJ to fight procurement fraud more effectively;
2) Assess existing government-wide efforts to combat procurement fraud and work with both auditing staff and contracting staff inside and outside of the government to detect and report fraud;
3) Increase and accelerate civil and criminal prosecutions and administrative actions to recover ill-gotten gains resulting from procurement fraud;
4) Educate and inform the public about procurement fraud;
5) Identify and remove barriers to preventing, detecting, and prosecuting procurement fraud; and
6) Encourage greater private sector participation in the prevention and detection of procurement fraud.
What are the significant accomplishments of the Task Force?
The Task Force has held six full meetings attended by over 125 representatives from more than 30 agencies. Overall, there is now more effective resource allocation in procurement fraud investigations, which has resulted in the acceleration of investigations and prosecutions. The Task Force has taken a coordinated and unified approach to combating procurement fraud related to the wars in Iraq and Afghanistan, as well as reconstruction efforts in those countries. Additionally, DOJ components are working to build more effective partnerships to prosecute cases.
Task Force efforts have resulted in significant accomplishments, including those highlighted below:
The Task Force has created nine working committees, which consist of representatives from multiple agencies, to address common issues such as training, legislation, intelligence, information sharing, private sector outreach, suspension and debarment, grant fraud, and international procurement fraud;
The Task Force has significantly increased training for OIG agents, auditors, and prosecutors regarding the investigation and prosecution of procurement fraud cases. The Training Committee, for example, recently hosted a national procurement fraud conference in Richmond, Virginia, in early September 2008. Approximately 500 prosecutors, agents, and auditors attended the conference, which offered a broad array of courses consistent with the conference’s theme, “Effective Programs & Strategies in Combating Procurement Fraud;”
The Task Force has established a public website, http://www.usdoj.gov/criminal/npftf, which identifies more than 400 procurement fraud cases that have resulted in criminal charges, convictions, civil actions, or settlements since the creation of the Task Force. More than 300 of these cases have resulted in criminal convictions (in some of these cases, sentencing is still pending). The website also has assisted suspension and debarment officials by listing press releases related to recent procurement and grant fraud cases in a single location;
Since the creation of the Task Force, DOJ, with the assistance of IGs, has recovered more than $362,000,000 in civil settlements or judgments arising from procurement fraud matters;
In addition to civil claims brought or settled, as of May 2009, DOJ has brought criminal charges related to
procurement fraud in connection with GWOT, which includes matters involving Iraq, Kuwait, and Afghanistan, against more than 80 defendants. More than 45 of these cases have resulted in criminal convictions. This figure represents more than triple the number of similar cases that had been brought by June 2007;
The Task Force has proposed modifications to the Federal Acquisition Regulation (FAR) that would significantly improve government efforts to reduce fraud in government contracts. Specifically, the Task Force has proposed modifications to the FAR that would require contractors to notify the government whenever they become aware of a material contract overpayment or fraud, rather than wait for the contract overpayment or fraud to be discovered by the government. On November 14, 2008, a final Rule was published substantially incorporating the Task Force’s proposed modifications. The Rule became effective on December 12, 2008. Additionally, the Task Force has proposed modifications to the FAR that would address conflicts of interest associated with service contract employees;
The Task Force has formed numerous regional working groups, chaired by U.S. Attorneys, to bring about timely and effective procurement fraud prosecutions by coordinating efforts between U.S. Attorneys’ Offices and their local Federal law enforcement counterparts; and
Various members of the Task Force recently were awarded the Attorney General’s Award for Distinguished Service for their efforts on the Task Force.
What are some of the significant cases?
For information on the most current procurement fraud cases, go to the website Press Room. A representative group of significant cases are described below.
Case highlights:
US v. Carolyn Blake (DOJ Antitrust and Criminal Divisions)
On March 19, 2009, Carolyn Blake pled guilty to one count of money laundering conspiracy after accepting more than $3 million in bribe proceeds on behalf of her brother, Major John Cockerham. The scheme ran from June 2004 through December 2005, while Cockerham was deployed to Camp Arifjan, Kuwait. There Cockerham served as a contracting officer responsible for soliciting and reviewing bids for DOD contracts in support of operations in the Middle East, including Operation Iraqi Freedom. Blake, Cockerham, and Cockerham’s wife accepted approximately $9.6 million in bribe payments in return for awarding contracts to corrupt contractors.
US v. Christopher Murray (DOJ Public Integrity and Antitrust Divisions)
On January 8, 2009, retired Army Major Christopher Murray pled guilty to charges of bribery and making a false statement arising out of his duties at Camp Arifjan, Kuwait. In 2005 through 2007, Murray served as a contracting specialist and was responsible for soliciting and recommending the award of contracts to particular contractors. In this capacity, Murray admitted he received close to $250,000 in bribes from DOD contractors.
US v. Baker (DOJ Antitrust Division)
On December 22, 2008, Theresa Jeanne Baker, a Major in the U.S. Army Reserve, pled guilty for her role in two bribery schemes involving DOD contracts at Camp Victory, Iraq. As part of the same investigation, Elie Samir Chidiac, a former employee of a defense contractor, Raman International Inc., was indicted in January 2008 on conspiracy to commit bribery. In the first conspiracy, Baker received money and other items from Raman and Chidiac, in return for conveying sensitive information and fraudulently awarding contracts to Raman. Upon performance of these contracts, Chidiac received payment from the DOD on Raman’s behalf and kicked back a portion of that profit to Baker. In the second conspiracy, Baker canceled contracts that were awarded to third party contractors and fraudulently re-awarded them to Chidiac. Baker then authorized Chidiac to receive cash payments for those contracts, totaling more than $700,000.
US v. Whiteford & Wheeler (DOJ Public Integrity Division)
On November 7, 2008 U.S. Army Colonel Curtis G. Whiteford and U.S. Army Lieutenant Colonel Michael B. Wheeler were convicted of conspiracy to commit bribery and interstate transportation of stolen property. The convictions stemmed from Whiteford and Wheeler’s roles in a scheme involving the theft of millions of dollars from the Coalition Provisional Authority (CPA) in Iraq. Whiteford and Wheeler were charged, along with U.S. Army Lieutenant Colonel Debra M. Harrison and civilians William Driver and Michael Morris with various crimes related to a scheme to defraud the CPA. In December 2003 through December 2005, Whiteford and Wheeler conspired with at least three others—Robert Stein, former comptroller and funding officer for the CPA; Philip H. Bloom, owner and operator of several companies in Iraq; and U.S. Army Lieutenant Colonel Bruce D. Hopfengardner—to rig the bids on contracts being awarded by the CPA so that more than 20 contracts were awarded to Bloom. In total, Bloom received more than $8.6 million in rigged contracts. Bloom, in return, provided Whiteford, Harrison, Wheeler, Stein, Hopfengardner and others with more than $1 million in cash, and other items of value.
US v. Lanmon
(U.S. Attorney’s Office – Western District of Washington)
On October 31, 2008, Army Captain Cedar Lanmon was sentenced to one year in prison, and one year of supervised release for accepting illegal gratuities. In his guilty plea, Lanmon admitted that he accepted $25,000 from an Albanian contractor while assisting with the awarding of government contracts to build berms at a military base in Ballad, Iraq. Lanmon wired some of the illegally obtained funds home to his wife, or transported the cash back to the United States. Lanmon also purchased high value rugs and furniture in Iraq and brought them to his home in Tacoma, Washington, planning to sell them for profit in the U.S. Lanmon was charged in November 2007, and pled guilty on July 23, 2008.
US v. Dubois
(DOJ Criminal Division and U.S. Attorney ’s Office - Eastern District of Virginia)
On October 7, 2008, Lee William Dubois, a former contractor for the U.S. Army in Iraq, pled guilty in the Eastern District of Virginia, for his participation in a scheme to steal 10.5 million gallons of jet and diesel fuel worth $39.6 million from Camp Liberty in Baghdad. Between approximately June 1, 2007, and May 30, 2008, Dubois and his co-conspirators, used fraudulently obtained common access cards and false fuel authorization forms to steal fuel from the Victory Bulk Fuel Point, Camp Liberty, Iraq, for subsequent sale on the black market.
How can prosecutors, investigative agents and auditors get involved in their respective geographic areas?
The Task Force has also formed numerous regional working groups to ensure that the Task Force encourages the investigation and prosecution of procurement and grant fraud nationwide. To date, there are 14 USAOs that have organized their own regional procurement fraud working groups and 22 other USAOs that are participating in those groups. Contact information for the coordinators of these groups can be found here.
The regional working groups, which are chaired by U.S. Attorneys, have implemented the Task Force’s goals regionally by working with their local federal law enforcement counterparts to bring about timely and effective procurement fraud prosecutions. These groups are facilitating the exchange of information among participant agencies and assisting them in developing new strategies to prevent, detect, investigate, and prosecute procurement fraud. Many of the groups meet routinely and have offered training on issues such as corporate criminal liability, data mining, and parallel proceedings, among others. In addition, some of the working groups have reported an increase in civil and criminal procurement and grant fraud referrals since the formation of their groups and are rotating meetings among participant agencies.
In October 2006, the Department of Justice announced a new national procurement fraud initiative established by the Criminal Division to promote the early detection, prevention, and prosecution of procurement and grant fraud associated with increased contracting activity for national security and other government programs. In partnership with U.S. Attorneys’ Offices, the Justice Department’s Antitrust, Civil, Environmental and Natural Resources, National Security, and Tax Divisions, and other federal law enforcement agencies, the Department formed the National Procurement Fraud Task Force, chaired by the Assistant Attorney General of the Criminal Division, to intensify the government’s detection efforts and to continue prosecuting those who defraud taxpayers. The Executive Director of the Task Force is Steve A. Linick, who spearheaded a procurement fraud task force in the Eastern District of Virginia and is now a Deputy Chief in the Department’s Criminal Division, Fraud Section. Brian Miller, the IG for GSA, is the Vice-Chair of the Task Force. 
