The downfall of a top official in the Transportation Security Administration this week came amid allegations of under-the-radar bonuses and targeted retribution at the highest levels of the agency.
One of the practices that led to Kelly Hoggan’s removal as head of the TSA’s crucial security division is common enough to have a name: smurfing.
“Smurfing is breaking specific financial transactions into something below the reporting requirement, which is what happened here,” said John Roth, inspector general for the Department of Homeland Security. “The [TSA] regulations at the time were so loose that it was technically permissible, even though clearly the intent was wrong.”
It was undercover agents from the inspector general’s office who last year were able to penetrate security checkpoints at U.S. airports while carrying illegal weapons or simulated bombs, 95 percent of the time.
Hoggan received bonuses of $10,000 on six different occasions, and three others just above or below that amount, over a 13-month period in 2013 and 2014, according to information collected by the DHS, which oversees the TSA.
The bonuses, amounting to more than $90,000, were approved internally and were in addition to Hoggan’s $181,500 salary.
“In my opinion, that’s completely unjustifiable,” said TSA Administrator Peter V. Neffenger, who took office in July.
Hoggan also was identified as one of the senior TSA officials who used forced transfers to punish agency employees who spoke out about security lapses or general mismanagement. Those allegations, first raised by TSA whistleblowers, caused considerable anger among members of Congress at three hearings held this month and last.
Three of the whistleblowers appeared before the House Committee on Oversight and Government Reform on April 27.
“Many of the people who broke our agency remain in key positions,” testified Jay Brainard, the TSA security director in Kansas. “These leaders are some of the biggest bullies in government.”
Brainard was given a forced transfer from Iowa to Maine in 2014.
Mark Livingston, a manager in the Office of the Chief Risk Officer at TSA headquarters, told the committee that his pay was reduced by two grades after he reported misconduct by TSA officials and security violations.
“If you tell the truth in TSA you will be targeted,” Livingston said.
Andrew Rhoades told the committee of an outspoken TSA executive who received a forced transfer from Florida to Iowa, a move that would have required him to abandon care of his elderly parents and pull his daughter from her senior year in high school.
“Directed reassignments have been punitively used by TSA senior leadership as a means to silence dissent, force early retirements or resignations,” said Rhoades, a TSA manager at Minneapolis-St. Paul International Airport.
Rhoades said he was told he would be transferred to Tampa after TSA officials concluded he had leaked information to a reporter, an accusation he denies. The move, which was blocked when he appealed to the U.S. Office of Special Counsel, would have cost him custody of his two daughters.
“If there is retaliation, we have a major problem with that,” said Rep. Elijah E. Cummings (Md.), the ranking Democrat on the Oversight Committee. “Some of the stuff really upsets me, because basically what they were doing was tearing up families.”
Neffenger said that employees are no longer subjected to punitive forced transfers and that all executive bonuses now require DHS approval.
“I have dramatically changed that,” he said, calling forced transfers “illegal” and “unethical.”
But as recently as May 12, Neffenger publicly defended Hoggan’s performance in the time that he has been administrator.
“I have not seen any indiscretions on his part in the time I have been in TSA,” Neffenger told the Oversight Committee that day. “I think he was carrying out orders and those orders resulted in people being reassigned, sometimes for good reasons, sometimes for ill-considered reasons.”
Rep. Mark Walker (R-N.C.) fired back, “I do think there is some responsibility on his part, even if he was carrying out orders.”
Hoggan’s ouster was announced Monday in a staff memo that did not mention him by name. When Neffenger made his third Capitol Hill appearance — this time before the House Homeland Security Committee — 48 hours after Hoggan’s removal, he again faced questions about bonus pay and forced reassignments.
Hoggan remains on the TSA payroll. After a leave of absence he is scheduled to report to a Northern Virginia command center that coordinates intelligence-gathering.
He could not be reached for comment this week, and the TSA declined to discuss any aspect of his removal.
Hoggan’s removal comes at a time when the TSA is facing sharp criticism on Capitol Hill and from travelers as lines have grown painfully long at its airport security checkpoints. The longer lines are the result of near-record airline travel this year, changes in checkpoint procedures and TSA staffing shortages.
The controversy over Hoggan predated the longer lines and is unrelated to them, though his removal was widely misreported as a TSA reaction to its airport woes.
The inspector general, in a report last year, outlined a convoluted process through which Hoggan received the bonus pay. His boss, then-TSA Deputy Administrator John Halinski, told one of Hoggan’s subordinates to recommend Hoggan for the bonus money. That subordinate, Deputy Assistant Administrator Joseph Salvator, recommended that Hoggan receive bonuses. Halinski then approved them.
Halinski resigned from the TSA in 2014. Salvator remains at the agency.