Security checksSecurity check contractor defrauded U.S. of millions of dollars
The Department of Justice said Wednesday that U.S. Investigations Services (USIS), the company which conducted the background checks on Edward Snowden and Aaron Alexis, has defrauded the government of millions of dollars. The government charges that between 2008 and 2012, 650,000 background investigations – about 40 percent of the company’s investigations in that period – were submitted to the government as having been completed although, in fact, they were not. Several former and current USIS employees said the company had an incentive to rush background check work because it was paid only after a file is marked “FF,” for fieldwork finished, and sent to the government. Two senior managers said that toward the end of the month, investigations were closed in order to meet financial quotas, without a required review by the quality control department.
Falls Church, Virginia-based U.S. Investigations Services (USIS), the company which conducted the background check on Edward Snowden , fraudulently signed off on hundreds of thousands of incomplete security checks in recent years, the Justice Department said Wednesday.
DoJ said the company defrauded the government of millions of dollars by submitting more than 650,000 investigations that had not been completed. The government relies these background check reports in making hiring decisions and determining who may get access to national security secrets.
The New York Times reports that USIS also performed the background check for Aaron Alexis, a 34-year-old military contractor who killed twelve people at the Washington Navy Yard last year.
The Times notes that the charges highlight how dependent the government is on contractors to perform various national security functions, and also how the screening of contractors who perform these functions requires even more contractors.
USIS, is the largest outside investigator for government security clearances.
Senator Claire McCaskill (D-Missouri), who co-sponsored legislation aimed at reforming the security clearance process, issued a statement Thursday critical of the “stunning failures of this company — and the resulting threats to our national security.”
DoJ charges that from March 2008 to September 2012, about 40 percent of the company’s investigations were fraudulently submitted. The charges are made in a 25-page complaint filed in U.S. District Court in Montgomery, Alabama, where USIS has been the subject of a whistle-blower lawsuit since 2011. The lawsuit that the government is joining was originally filed by Blake Percival, a former director of field work services at USIS. He sued the company in 2011 under the whistleblower provisions of the False Claims Act, accusing the company of rushing cases through the system and hiding the practice from the OPM.
The Wall Street Journal first reported on Wednesday that the government has officially joined that case.
The government accuses USIS of releasing incomplete investigations in a practice referred to in court documents as “dumping.” The government quoted internal company e-mails to show that the practice was widespread.
“Have a bit of a backlog building, but fortunately, most people are off this week so no one will notice!” one USIS employee e-mailed in 2010.
USIS released this statement Thursday morning: “These allegations relate to a small group of individuals over a specific time period and are inconsistent with the strong service record we have earned since our inception in 1996. Since first learning of these allegations nearly two years ago, we have acted decisively to reinforce our processes and management to ensure the quality of our work and adherence to OPM requirements. We appointed a new leadership team, enhanced oversight procedures, and improved control protocols. From the outset, we have fully cooperated with the government’s investigation and remain focused on delivering the highest quality service under our OPM contracts.”
The Times reports that in September last year, several former and current USIS employees offered details about how the company had an incentive to rush background check work because it was paid only after a file is marked “FF,” for fieldwork finished, and sent to the government. Two senior managers said that toward the end of the month, investigations were closed in order to meet financial quotas, without a required review by the quality control department.
The Washington Post reports that the rushed work qualified the company for nearly $12 million in performance bonuses from the federal government.
The federal Office of Personnel Management (OPM) confirmed that it paid USIS on a piecework basis. “The vendor is paid upon the delivery of a completed case,” the agency said in a statement shortly after the Navy Yard shooting. OPM believed that this method of payment would give the company an incentive to be efficient.
Patrick McFarland, the inspector general of OPM, told a Senate hearing last June that “there may be some problems” with the Snowden investigation, but he did not go into details. The Post reports that congressional staffers said a classified inquiry conducted by the Office of the National Counterintelligence Executive may have revealed flaws in the background check.
