Federal prosecutors and the Department of Energy’s Office of Inspector General have netted five convictions and recouped approximately $2 million of taxpayer funds – including $700,000 of Recovery money – following investigations into fraudulent claims for per diem payments at the Savannah River Site in South Carolina.
The indictments and convictions, announced by U.S. Attorney Bill Nettles in Columbia, South Carolina, are the IG’s first involving Recovery Act funding. DOE Inspector General and Recovery Board member Gregory H. Friedman lauded his special agents and Justice Department prosecutors, saying they worked “aggressively to ensure that Recovery Act money was spent appropriately.’’ Friedman also commended the cooperation of federal and contractor officials at the site.
Since the early 1980s, DOE has been working to clean up contamination left over from production of nuclear weapons dating back to the 1950s. In 2009, the agency allocated a total $1.6 billion in Recovery funds to accelerate efforts specifically at the Savannah River Site.
In early 2010, the DOE OIG received information from on-site agency officials about fraudulent claims being submitted for per diem expenses on Recovery-funded projects. Per diem payments are made to subcontractors’ employees who have been temporarily assigned to a site more than 100 miles from an employee's permanent residence. The payments are meant to offset costs associated with temporary assignments.
The IG, which had initially assembled a team of investigators in 2008 to review potential fraudulent per diem payments at the site, expanded its efforts and worked closely with Justice Department prosecutors and DOE attorneys to look into the allegations involving Recovery funds. The team obtained and analyzed per diem claims and supporting documentation, including individual bank records and public records. The investigations confirmed the existence of fraudulent per diem claims involving Recovery and non-Recovery funds.
On August 2, U.S. Attorney Nettles announced the criminal convictions resulting from the investigations.
Additionally, ten employees of subcontractors have been terminated at the site.
U.S. Attorney Bill Nettles’s statement
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