# Presentation: 787535

**Office of Inspector General**
**Investigations**

## Gregory E. Picur, CPA, CFE 

**Gregory E. Picur, CPA, CFE **

**Licensed Certified Public Accountant**
**Certified Fraud Examiner**
- 8 years as a Special Agent w/ USAID/OIG
**Washington (1), Cairo (4) and Budapest (3)**
- 10 years as a Special Agent w/ IRS CID
- 3 years as a Private Sector Auditor

## Course Objectives  

**Familiarization with OIG/I**
**Introduction to investigative process**
**Awareness of Fraud Schemes**
**Benefits to Reporting Fraud to OIG/I**

## IMPORTANT PEOPLE PARTICIPATE IN FRAUD AWARENESS BRIEFINGS :

## Investigations

**Investigations**

**Regional Field Offices**

## The Mission of Investigations

- Detect and prevent fraud, waste and abuse in USAID programs and operations

## What does Investigations do?

- Conducts investigations of alleged violations of law, rules and regulations within USAID programs and operations

## What is an Investigation?

- An authorized inquiry  to gather the facts needed to resolve alleged violations of rules, regulations or laws related to USAID programs and operations

## How does the IG decide what to investigate?Most investigations are reactive:

**Hotline calls**
**Employee or contractor referrals**
**Correspondence to IG **
**Audits and inspections**

**Referrals from other agencies**
**Other investigations**
**Information given to OIG staffers**

## What are OIG’s Investigative Priorities?

- Procurement and contract *fraud* including grants & cooperative agreements
*Serious misconduct* by employees and personal services contractors

## What are OIG’s Sources of Allegations?

**USAID Employees**
**Audit**
**Contractors**
**Private Citizens**
**Confidential Informants**
**Other Sources**

## What is OIG’s Jurisdiction?

- OIG has investigative responsibilities for USAID programs and operations in the United States and countries receiving U.S. foreign assistance.

## What is the outcome of an investigation?

**If there is ****evidence of criminal wrongdoing****, the Case is referred to DOJ**
**Criminal prosecution**
**Civil suit**
**Concurrent criminal and civil action**
**Decline prosecutory action and refer for administrative  action**

## What is Administrative Action?

**Employee**
**Removal **
**Demotion**
**Suspension**
**Reprimand**
**Admonition**
**Restitution**

**Contractor**
**Termination of an award**
**Suspension/Debarment**

##  FRAUD SCHEMES & INDICATORS 

## Fraud in Development of Specs. And SOW

**Allowing firms participating in project design to obtain those same project contracts or to be subcontractors to the winning bidder**
**Release of information by firms participating in project design to contractors competing for the prime contract**
**Aggressive inquires by bidding contractors as to the participants and location of the technical review committees.**
**“****Splitting up” requirements to meet the small purchase requirements or to avoid review/approval regulations, so as to keep each segment within the authority of a favorite person or activity**

## Fraud in the Development of Specs and SOW

- (continued)
**Specifications that are so vague that reasonable comparisons of estimates would be difficult or impossible**
**Restrictive Specifications that keep competition to a minimum**
**Specifications that are not consistent with past or similar procurements**
**Specs that do not specify a site or location **

## FRAUD IN PRE-SOLICITATION PHASE

## Slide 19

## Slide 20

## FRAUD IN THE AWARD OF THE CONTRACT1. 	Disqualification of any qualified bidder2. 	Allowing a low bidder to withdraw without justification.3. 	Awards made to contractors with an apparent history of                                                               poor 		performance.

## PRODUCT SUBSTITUTION

## PHANTOM CONTRACTORS

## BRIBERY AND ILLEGAL GRATUITIES

## EMPLOYEE REFUSES PROMOTION, OR JOB CHANGES

## COMPANIES CONDUCTING BUSINESS UNDER SEVERAL NAMES

## WARNING: Signs of an Embezzler

**They thrive in an office with no segregation of duties**
**They rarely take vacation/sick days**
**They work excessive O/T especially late at night or on weekends**
**They make excessive adjusting entries/ white-outs**
**They Request excessive deadline extensions during monthly closeouts or other accounting cycles**
**They will usually exhibit a drastic change in life style**
**Will go to great extents to disguise their ill-gotten gains**
**They refuse promotions, job rotations or changes**

## Anti-Trust, Collusive Bidding & Price FixingWARNING SIGNS

**All Bids are much higher than the govt. estimates**
**Qualified Contractor/Bidders who regularly bid on such contracts show no interest and/or fail to bid.**
**Losing bidders are hired as subcontractors **
**Bidders exchange price information (price lists, etc)**
**Competitors regularly socialize or are seen together**
**Similarity in bids : such as identical spelling errors, miscalculations, or one firm handling several bidders**

## Cynic’s Corner

**Q: As a Contractor or Grantee...**** **
**Why would I ever call the OIG to report Fraud, Waste or Abuse in my Company?**
**What possible benefit could I derive from reporting Fraud, Waste or Abuse ?**

## A:  The Benefits of Contacting OIG/I are :

- Safeguard of assets and Reputation
- Leniency (in Anti-Trust Cases)
- Participation in Qui-Tam
- Mitigation of damages under the FCPA

## Anti-Trust Division

- Corporate Leniency Policy

- Sherman Anti-Trust Act
- Title 15

## DIVISION LENIENCY  POLICY

- HEAD LINES :

**A- ****LENIENCY *****BEFORE***
***        *****AN INVESTIGATION HAS**
**             ****BEGUN.**

**B- ****ALTERNATIVE**** ****	****	****       REQUIREMENTS FOR ****	****         ****	****       LENIENCY.**

**C- ****LENIENCY FOR****	****  ****	****  ****	****               ****	****       CORPORATE DIRECTORS, ****	****         ****	****       ****	****       OFFICERS, AND EMPLOYEES.**

## DIVISION LENIENCY  POLICY

**Corporations reporting illegal antitrust activity at an early stage, can receive leniency if certain conditions are met.**
**Whether or not the corporation receives leniency the directors, officers and employees can receive leniency if certain conditions are met.**

_***CONCLUSION***_

## Title 31

*Title 31*

- USC Sec. 3730:

- Civil Actions for False Claims

- Q  U  I    T  A  M

## Qui Tam Plaintiff Protection

**Qui Tam Plaintiff Protection**

**Any Employee who is **_**discharged**_**, **_**demoted**_**, **_**suspended**_**, **_**threatened**_**,  **_**harassed**_**, or in any other manner discriminated **_**against**_** in the terms and conditions of employment by his or her employer because of lawful acts done .  .  . in furtherance of an action under this section, shall be entitled to **_**all**_** **_**relief**_** **_**necessary**_** to make the employee whole.  Such relief shall include:**
**    ****REINSTATEMENT with the same seniority status such**
**     ****	****employee would have had but for the discrimination.  **
**    **_**2 TIMES the amount of back pay**_**,  including interest on**
**       ****the back pay.**
**    ****COMPENSATION for any special damages sustained as a**
**     ****	****result of the discrimination, including litigation costs**
**              ****and reasonable attorneys’ fees. **

## Will I be subject to retaliation for giving information to the IG?

**Federal law prohibits reprisal for making a complaint or giving information to an IG provided that the employee acts in good faith**
**If you believe that you are the subject of a reprisal, report to the IG or to the Special Counsel for the Merit Systems Protection Board**
**The IG can request and the Special Counsel can direct that adverse personnel action be delayed until investigation determines whether or not a reprisal has occurred. If it has, the action can be voided and sanctions imposed on the initiator.**

## What is the OIG Hotline?

**A toll-free telephone number to report directly to the OIG**
**Monitored by trained investigators**
**Can provide information anonymously or request confidentiality**
**800-230-6539 or 202-712-1023**
**or call the nearest OIG office in **
**Budapest: 36-1-475-4611**
**IVG : 990-4629**
**Email:  gpicur@usaid.gov**

## Hotline Do’s and Don’ts

**DO:**
**Provide as much detail as possible**
**Don’t:**
**Use the hotline for personal gripes that should be handled through established personnel procedures**

## What if I request confidentiality?

**The OIG will do everything possible to protect your confidentiality but there may be circumstances under which you name may be disclosed, such as during prosecution of a court case**
**There is no absolute guarantee**

## Are There Any .....

**Questions ???**
**Comments ??**
**Complaints ??**
**Shameless Flattery ....**

## The End