IGs Seek More Powers to Oversee Federal Contracting

By Ed O'Keefe
Washington Post Staff Writer
Wednesday, April 22, 2009

A new Senate subcommittee responsible for tracking government contracting heard yesterday from federal watchdogs seeking greater investigatory and enforcement powers and more staffing to try to keep up with the expansion in federal spending.

Federal spending on contracting ballooned to more than $500 billion last year, one of the reasons that lawmakers established the Senate Homeland Security and Governmental Affairs subcommittee on contracting oversight in late January.

The panel is likely to focus on the use of foreign contracting firms, on how government contractors and the military plan to withdraw troops and equipment from Iraq and expand operations in Afghanistan, and on the suspension and debarment of contracting companies, a spokeswoman said.

The subcommittee's chairman, Sen. Claire McCaskill (D-Mo.), a former prosecutor and state auditor, is a close friend of President Obama and has devoted much of her relatively brief Senate tenure to government oversight and management issues.

She has kept close watch on economic recovery funds in recent months and supports the expansion of the efforts of inspectors general, the investigatory arm of federal agencies.

"This isn't about partisanship, and it isn't about denigrating government contractors or the federal government," McCaskill said at the hearing. "Our subcommittee has an important responsibility to make government contracting as honest, transparent and accountable as possible."

To do so, inspectors general said yesterday, they need subpoena powers on a par with those afforded to grand juries.

Currently, inspectors general must notify subjects of an investigation before they can obtain financial records, an impediment to comprehensive and timely investigations, said Brian D. Miller, inspector general for the General Services Administration.

He suggested that the restrictions could help suspects destroy evidence, intimidate witnesses or flee the country.

"As an illustration, telling someone like Bernie Madoff that he's under investigation would only give him an opportunity to hide or transfer ill-gotten gains before the government had an opportunity to understand the full extent of his crimes," said Miller, referring to the financier convicted of defrauding his clients of almost $65 billion.

Watchdogs also generally support legislation that would compel federal employees and others to show up for interviews with inspector general special agents, actions not currently required in all cases, said J. Anthony Ogden, inspector general for the Government Printing Office.

"The issue is about access," he said, noting that inspectors general need complete access to contractor employees, former employees and subcontractors to fully complete investigations. Part of the reason inspectors general lack such powers is that most of the laws authorizing their existence were written more than three decades ago.

"The contracting workforce has expanded significantly since many of these laws and rules were put in place, so in order to kind of catch up with the times we have to look at the entire scope of the issue and realize that the reach now for IGs has to be to contractors and subcontractors," Ogden said.

The subcommittee plans to hold hearings at least once every six weeks, said Maria Speiser, a spokeswoman for McCaskill.

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