June 19, 2018
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Probe prompts VA official to resign

By Steve Vogel, The Washington Post

WASHINGTON — The top human resources official for the Department of Veterans Affairs resigned and two other employees were placed on leave after an investigation into two VA conferences in Florida found that department conference planners allowed up to $762,000 in questionable spending and accepted gifts, including spa treatments and entertainment.

The VA Office of Inspector General report released Monday found that the supervision by senior VA officials over two training conferences in Orlando last year was “weak, ineffective, and in some cases, nonexistent.” This resulted in “numerous examples of excessive costs and unnecessary and supported expenditures,” the report said.

John Sepulveda, assistant secretary for human resources and administration for the Department of Veterans Affairs, “abdicated his responsibilities when he failed to provide proper guidance and oversight to his senior executives in the operations of his organization,” the report added. Sepulveda resigned on Sunday, the VA said in a statement.

The report found that the VA spent $6.1 million on the two human resources conferences in Orlando, not $5.1 million as previously stated by the department. But investigators said the discrepancy was not because of deceit, but instead to a lack of oversight that has made it difficult even now to make a complete accounting of the costs.

Relatively low-ranking VA conference planners approved spending for the events far beyond their authority, the report found.

The investigation also found that 11 VA employees managing the conferences accepted gifts from contractors seeking to do business or already doing business with the VA.

The gifts including spa treatments, lodging, tickets for the Rockettes, a golf package and a helicopter ride.

James J. O’Neill, assistant inspector general for investigations, said there was “no obvious quid pro quo” involved with the gifts. But investigators referred one case in which they believe an unnamed VA employee solicited hotel lodging to the Department of Justice for review for possible prosecution.

The report identified $280,000 in excess of the VA contract with Orlando World Center Marriott for the conferences, including money for audiovisual services, catering, food and beverages. Other unsupported expenses include almost $154,000 in contractor travel paid by VA.

The conferences included $49,000 spent by the department to produce a parody of George C. Scott’s famed opening scene in the 1970 film about Gen. George S. Patton. The IG report called the expenditure “wasteful” and noted that the conference planner lacked authority to approve the expense.

The report said Sepulveda falsely told investigators that he had not viewed the Patton video prior to the conference. In an affidavit released with the report, Sepulveda said he had forgotten that he had seen the video over a year ago. “I was unfairly accused of making a false statement,” Sepulveda said in an interview Monday evening.

Sepulveda said that he did not closely monitor the conferences because he thought it “inappropriate” for a political appointee to oversee details on conference spending. “I relied on my career staff to do so,” he said. Sepulveda added that “I’m a man of integrity and I’m proud of my record of accomplishment in public service.”

Investigators found that the two training conferences, which included classes for about 1,800 VA human resources employees, fulfilled “valid training needs.”

The IG office did not identify other VA conferences where overspending was a problem. “At this time we don’t have any evidence this is pervasive,” O’Neill said.

Rep. Jeff Miller, R-Fla.,, chairman of the House Veterans’ Affairs Committee, said the report “demonstrates that some senior VA leaders have given little attention to how veteran funding is being spent and VA lacks an adequate system of checks and balances to ensure this type of abuse does not occur.”

Miller noted that the VA conferences cost far more than the $823,000 spent on the infamous General Services Administration conference in Las Vegas, an incident that prompted a whistleblower’s complaint about the VA conferences to the IG.

“The actions cited in the report represent serious lapses in oversight, judgment and stewardship,” VA said in a statement.

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