Department of Energy watchdog Gregory Friedman is one of the longest-serving inspectors general in the federal government. He is a methodical examiner who said he thinks of his work in terms of Venn diagrams.
In an interview with the Federal Eye last week, Friedman talked about monitoring the federal agency responsible for energy policy, the nation’s nuclear-weapons stockpile, radioactive-waste cleanup and the Navy’s nuclear propulsion systems, among other matters. Below is a transcript of the discussion, edited for length:
You’ve worked for the government for 47 years, including time as a Defense Department auditor. How did you end up with the Department of Energy?
In ’73-’74, there was an oil embargo, and I came to work for what was the predecessor to the Department of Energy. I was involved in contingency planning for another oil embargo, including the development of a gasoline-coupon rationing plan. We printed 4.8 billion rationing coupons that would be distributed to the American people, and that would be the ticket to get gasoline for their automobiles.
In retrospect, I now realize it would have forced the creation of a huge bureaucracy. It would have been very difficult to execute, and I’m not at all sure it would have been successful.
Sounds like you put your inspector general’s lense on your own past work there.
Well, I try to be realistic, and the truth is, I’m just not sure it would have worked.
What issues have raised the most concern for you lately?
The environmental cleanup work, which is a major focus of the department, there have been lots of problems in terms of project management and getting the job done on budget within schedule. We’ve seen a series of consistent problems there.
Getting the balance right in contract administration has been very difficult. It has not been easy to manage and administer very large cost-reimbursement contracts. So that’s also been a major concern of ours.
These are $1.5 billion contracts on an annualized basis. So these are huge costs that are flowing through the contracts. The government reimburses the contractor for almost all of the costs.
How much abuse do you see in that area?
We have 200 to 250 criminal investigations ongoing at any given time. Sixty percent of those deal with potential contract fraud, so that’s where we spend a lot of our time.
How often do you end up referring those cases for criminal prosecution?
A substantial number. We work with the Department of Justice on a number of cases. We currently are, we have been and we will do, so it’s a major focus.
Do you have a percentage?
I would probably say 60 to 65 percent. To be clear about it, frequently there’s a settlement when you go to the Department of Justice. There are all sorts of avenues that occur. They may choose not to prosecute, even though the case is a good case for a variety of reasons — lack of jury appeal, complexity of the case, the recovery may not be all that great. So we have a very good working relationship with U.S. attorneys around the country working these cases.
What big issues are popping up in the other areas you monitor — environmental clean-ups, cybersecurity?
We had a major [cyber] intrusion last year. The [personally identifiable information] for I think 100,000 or so DOE contractor personnel and federal personnel and in some cases their spouses was compromised. We identified a whole series of weaknesses in the system where they needed fixes. Many of them were low-hanging fruit — inappropriate passwords, allowing other individuals to have access to your password, a whole variety of issues in the cyber area. Mainly the things that have been the topics around town at a number of agencies.
Those sound like cybersecurity basics.
A lot of it is low-hanging fruit and stuff that we can take care of. There are always people trying to ping our network. We have pings every day. Some of them are kids who are simply brilliant in many respects, just the challenge of getting into the network is worth it. Some is industrial espionage — it’s foreign governments. So there’s a range of people trying to ping the network. Some are people trying to get [personally identifiable information] and perhaps use it to compromise credit cards, so there are a range of issues, and there are a lot of them, unfortunately.
Do you know whether DOE is targeted more than other agencies?
I don’t know the answer to that. I do talk with my colleagues about these issues, and the pings throughout the government and to a large extent in the private sector, apropos to what’s happened recently with Target or whichever it is. It’s sort of ingrained in our capitalistic way of doing business, I’m afraid. It’s a big problem. I don’t think we’re unique. Of course, when you maintain highly classified information, you may be a target of unique opportunity by those who may want to compromise those aspects of your operation.
Solyndra was a big issue, especially during the 2012 presidential election. How did your office become involved in that case, and what were the challenges there?
The Justice Department has acknowledged that Solyndra is an active matter, so I really can’t talk about it.
But how do you approach cases that are politically sensitive like that one?
It’s interesting. I’ve been an IG here since 1998, and certainly we have been involved in a number of highly sensitive matters, including the Wen Ho Lee matter at Los Alamos, and certainly Solyndra and a number of high-profile cases. And never have efforts been made by either Republican administrations or Democratic administrations to thwart my work.
We really address all of them in a very similar fashion — methodically, objectively, fair, trying to make sure we have all sides of the story. We have done that without a great deal of outside pressure, so maybe I’ve been very fortunate. Probably some of my colleagues may not be able to say the same thing, but it’s worked well here.
I figure a lot of the information you deal with is classified. How do you feel about the level of access that the Department of Energy has given you?
We have the clearances we need — on an individual basis, on a need-to-know basis — to go almost everywhere and do almost everything. That’s not a problem.
Is there anything you need from Congress to help you do your job?
It’s interesting you ask. As you know, 48 IGs signed a letter to the Congress and to others complaining about access-to-records problems and independence. I have not had those problems. We’re dealing with one issue right now concerning access to records and attorney-client privilege, which is a little tricky. But I have very broad authority, and I’m comfortable with where we’re at. I have subpoena authority. My investigators carry weapons. We have long-guns. We do searches and seizures. We can arrest people.
On the audit side, we just haven’t had a problem, and I issue about 75 or a hundred audit inspection reports every year.They’re not cleared by OMB. They’re not cleared by the secretary. I sign them or my deputy signs them.
Why did you ultimately decide not to sign onto that letter?
Look, in terms of the principle, which is independence and access to records, I agree with the principles in the letter. But my concern was with tactics and strategies, not a concern with the principles that were outlined in the letter.
What differences have you noticed between the three administrations that you’ve worked with?
It’s not so much differences in the administrations; it’s differences with the secretaries. They were very different personalities. You know, they may have been the right person for the time.
Secretary Chu was a brilliant scientist who has very, very definite ideas on the question of solar and renewables and the actions we need to take as a nation to wean ourselves off fossil fuels. That was clearly different from the philosophy of the prior administrations. It was a new era. I don’t know whether the times make the person or the person makes the times. Sometimes it’s hard to figure.
Secretary Moniz is an advocate for renewables and solar and different technologies, but he has advocated for a balanced approach, recognizing that fossil fuels will be in our energy makeup for years to come. It’s just an unavoidable reality. So, sure there have been differences in personalities, differences in management styles.
Sam Bodman, who was the secretary in the second half of the Bush administration, came as a venture capitalist, successful business man. So he had definite ideas about structure and organization and what works, how you treat people. Which is not to say that the others didn’t. They bring a different philosophy.
There’s a lot of debate about renewables and alternative energy versus fossil fuels. Is there a role for you in that debate?
We don’t get involved in the policy questions. As individuals, everyone has views, but we check those personal policy views at the door. What we do do is evaluate whether programs are working and the payoff is right, and whether they’re meeting expectations and whether performance metrics are being satisfied.
Nonetheless, does anyone ask you to weigh in on policy a little bit?
We do. We get it primarily, frankly, from the Congress periodically.
How do you deal with that?
Well, look, we get a lot of requests from the Congress. We accept most of them. We don’t get involved in some of them, but we tell them upfront that we won’t get involved in the policy issues. If it happens that a congressman or a senator or a chairman of a committee or ranking member of a committee or subcommittee will use our work to buttress their view on the policy, that’s something I can’t control. And that sometimes happens.
How often do you receive tips that you can act on?
We get about 2,000 tips a year on our hotline. A lot of them are very valid, and they’re substantive. They have details, they have names, they have dates — things that we can act on. Some of them do not. They’re simply broad, general, you know — there’s widespread fraud at Los Alamos. Well, we can’t do much with that.