Investigative Reports

An Amtrak coach cleaner based in Chicago, Illinois, was terminated from employment on June 10, 2021, following his administrative hearing. Our investigation found that the former employee violated company policy by failing to report his arrest and conviction for driving under the influence and failing to report two other criminal convictions while employed by the company.

A former Amtrak electrician in Chicago pleaded guilty in the Circuit Court of Cook County, Illinois, to Financial Institution Fraud on June 9, 2021. The former employee was sentenced on the same date to one year probation and paid $11,944.44 in restitution to US Bank. Our investigation found that the former employee established a business and used it to engage in fraudulent credit card schemes.

Joshua Pearson, a marketer from St. George, Utah, was sentenced on June 3, 2021, in U.S. District Court, Central District of California, to three years probation, six months home confinement, and was ordered to forfeit $1,250,000. Pearson previously pleaded guilty to receipt of illegal kickbacks related to a health care fraud scheme after our joint investigation found that he received kickbacks from Sheridan Medical for patient referrals for compounded drugs—drugs that were medically unnecessary. A marketer from Sheridan Medical and the owner of Fusion Rx Compounding Pharmacy, both in Los Angeles, were also charged for their role in the scheme. Amtrak’s health insurance plan was fraudulently billed $17,000 as a result of the scheme. Criminal judicial proceedings for the other defendants are pending.

Lamont Brown, of Brooklyn, New York, was sentenced in U.S. District Court, Eastern District of New York, on June 2, 2021, to a prison term of time served, probation for 36-months and was ordered to pay restitution of $97,210 to Amtrak. Brown previously pleaded guilty to conspiracy to commit wire fraud for his involvement in an Amtrak eVoucher scheme. Our investigation found that Brown and his co-conspirators used stolen credit card information to make unauthorized purchases of Amtrak tickets, canceled or exchanged those tickets for eVouchers, and then sold the fraudulently obtained eVouchers on the internet.

A procurement manager was terminated from employment on May 21, 2021, after our investigation found she violated Amtrak policies by repeatedly mischaracterizing the relationship with and misrepresenting actions by our office to intimidate and coerce Amtrak employees and vendors from taking certain actions or into conducting certain actions on multiple occasions. Although the employee admitted to her misconduct, she was also evasive and provided inconsistent responses to our agents during her interview with us.

The investigation substantiated that a TVA employee negotiated employment with a contractor for whom he approved invoices; however, he did so with the knowledge and apparent support of TVA management. After becoming an employee of the contractor, he continued to approve invoices for the contractor (now his employer) as he had done while employed by TVA. While working for the Contractor, the subject potentially had direct access to the sensitive business information of vendors in direct competition with the employing contractor.The employee did not consult TVA Ethics for guidance on this matter while still employed by TVA.

The purpose of this report is to share with the U.S. Department of Education (Department) observations made by the Office of Inspector General (OIG) concerning institutions of higher education (IHE) that ceased to provide educational instruction in all programs of study (closed) and received or had access to coronavirus response and relief aid through the Higher Education Emergency Relief Fund (HEERF). We found that 17 IHEs that closed on or before December 31, 2020, applied for and were awarded a total of $4,912,675 of HEERF grants by OPE. Of these 17 IHEs, 14 drew down HEERF funds and 3 did not draw down any of their awards. Of the 14 IHEs that drew down their HEERF awards, 8 made drawdowns after the IHE closure date listed in the Postsecondary Education Participants System (PEPS). The total of these post-closure drawdowns was $1,261,329. In addition, 1 of the 14 closed IHEs that drew down funds made a draw of $364,715 one day before closing.

We investigated allegations that a National Park Service (NPS) supervisor took Government property for personal use and misused her official position. The NPS subsequently notified us that one of the supervisor’s subordinate employees also took Government computer equipment for personal use.We found that the NPS supervisor and two subordinate employees took Government property for personal use. We also found that the NPS supervisor misused two subordinates’ official time by directing them to perform work on her personal property for her personal benefit. Lastly, we found that park officials did not ensure that the subordinate employees received mandatory property disposal training.The NPS supervisor admitted guilt of felony theft and was accepted into a diversion program that, if successfully completed, would lead to dismissal of a felony theft charge. Based on that charge and an interim report of our findings, the NPS subsequently issued the supervisor a 14 calendar-day suspension without pay. She paid the NPS $3,964 in restitution.

We investigated allegations that an oil and gas production company claimed improper allowances for offshore Federal mineral leases in the Pacific Ocean. The company submitted royalty refund requests to the Office of Natural Resources Revenue (ONRR) for previously unclaimed oil and gas transportation allowances and gas processing allowances. The royalty refund requests raised suspicion at ONRR because the company had not claimed such allowances previously and because the royalty refund requests covered the regulatory maximum allowable period of 6 years.We found the company’s royalty refund requests were incorrect and poorly documented; however, we found no evidence the company intended to deceive or defraud ONRR. We found the company submitted claims on incorrect forms, improperly designated expenses associated with a pipeline it owned, and failed to provide ONRR with source documents that fully supported its royalty refund requests.We also found that the company owes unpaid mineral royalties to ONRR. The company reduced current Federal mineral royalty payments submitted to ONRR in an attempt to recoup funds included in its prior requests in anticipation that ONRR would eventually approve its claims for payment. As of April 2021, ONRR had denied the company’s royalty refund requests pending further review, and ONRR is continuing to work with the company to either approve the refund claims or recover any unpaid Federal mineral royalties.