The number of defense contracting fraud and corruption cases sent by government investigators to prosecutors decreased significantly during the Bush administration, even though contracting by the Defense Department almost doubled. Sounds like good news, right? Think again. Experts say it isn’t because fraud is down, rather the surveillance for it is.
“No one is minding the store,” former director of the Defense Criminal Investigative Service (DCIS) William G. Dupree told the Center for Public Integrity, who analyzed fraud data obtained from the Justice Department by the Syracuse University-based Transactional Records Access Clearinghouse (TRAC).
The TRAC data showed that Department of Defense (DoD) investigators during the Bush administration sent 76 percent fewer contracting fraud and corruption cases to the Justice Department for potential criminal prosecution than were referred under Clinton, while defense contracting grew from about $200 billion at the start of the Clinton presidency to nearly $400 billion at the end of the Bush presidency.
Why the decline? One reason is the simple lack of manpower. An inspector general’s report in March 2008 said DCIS lacked the personnel it needed to “detect, investigate, prosecute and deter criminal activity impacting DoD.” The mission of DCIS has also been expanded since 9/11 to include anti-terrorism operations, leaving them less time to focus on fraud and corruption. Auditors and other personnel in contracting and acquisition have also experienced workload increases, personnel cuts, and changes in job duties.
Some efforts for reform have been underway since 2006 when the Justice Department set up the National Procurement Fraud Task Force. The task force has improved coordination among government investigators, developed specialized training for agents and prosecutors on procurement fraud, and created an operations center to serve as a clearinghouse for intelligence on fraud related to the wars in Iraq and Afghanistan.
President Barack Obama and the Democrat-led Congress are focusing new attention on reforming the procurement process. On Capitol Hill, the Commission on Wartime Contracting held its first public hearing in February and Senator Claire McCaskill (D-MO) has been named chair of a new subcommittee on government contracting. In March, President Obama announced a review of government contracting rules, saying, “The days of giving defense contractors a blank check are over.”
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