The Federal Emergency Management Agency (FEMA) hired employees with criminal backgrounds—which resulted in the unnecessary expenditure of nearly $350,000—allowed employees to violate overtime and compensatory time policies, and mismanaged disaster relief funds, according to a recent report by the Department of Homeland Security’s (DHS) Office of the Inspector General (OIG).
On April 8, 2014, FEMA received an anonymous complaint implicating senior level managers of FEMA’s Office of the Chief Security Officer (OCSO) of fraud, waste, abuse, and mismanagement. An inspection conducted by DHS OIG confirmed these allegations.
According to DHS OIG, “The DRF is to be used to direct, coordinate, manage, and fund eligible response and recovery efforts associated with domestic major disasters and emergencies.” However, the investigators uncovered that FEMA mismanaged the DRF by hiring employees who never performed disaster-related activities, which violated the Robert T. Stafford Disaster Relief and Emergency Act (Stafford Act) and potentially the Anti-deficiency Act.
The Anti-deficiency Act provides for the appointment of temporary employees to deliver assistance to states and localities in the event of a declared “emergency” or “major disaster.”
The DHS OIG’s investigation uncovered that the CSO had prior personal relationships with two of the employees with previous criminal offences and that the former Personnel Security Branch Chief, influenced by the CSO, disregarded the criminal backgrounds and ignored whether these individuals were qualified under the suitability standards in the Code of Federal Regulations.
As a result, OCSO spent $349,944, excluding benefits, for the salaries of the four employees.
In accordance with FEMA Manual 253-2-1, Premium Pay, “Employees working in response to a presidentially declared disaster or emergency must be compensated in paid overtime for all overtime work.” COREs have the opportunity to amass compensatory time rather than paid overtime. But once a CORE reaches 40 hours of compensatory time, they are required to use a portion of their accrued compensatory time before earning any more.
The investigation unearthed that in 2014, Fraud and Internal Investigations Division (FIID) management violated FEMA’s premium pay policy by allowing COREs to amass compensatory time in excess of 40 hours.
DHS OIG offered two recommendations to help FEMA remediate these issues:
Recommendation 1: We recommend that the FEMA Chief Security Officer enforce FEMA’s premium pay policy for compensatory time for OCSO employees.
Recommendation 2: We recommend that the DHS Chief Financial Officer conduct an investigation on whether an Anti-deficiency Act violation occurred and report its findings to DHS OIG.
FEMA officials agreed with Recommendation 1, issuing a revised overtime policy on February 11, 2014. Since establishing this revised policy, FEMA has claimed to be enforcing this policy and asked that the recommendation be closed. DHS OIG considers this recommendation resolved.
In response to Recommendation 2, FEMA officials were also compliant, agreeing that the DHS Chief Financial Officer’s (CFO) Office of Financial Management will lead an Anti-deficiency Act investigation. January 4, 2016 saw the start of a preliminary investigation that will assess the facts against Department policy and legal interpretation of FEMA’s premium pay policy in regards to the Stafford Act. DHS OIG considers this recommendation resolved and open.
“This recommendation will remain open pending our receipt of FEMA’s preliminary Anti-deficiency Act investigation and documentation of any actions taken by the DHS CFO as appropriate,” said DHS OIG.