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VA illegally shifted funds to pay for new project — in Frank Underwood fashion

Kevin Spacey, left, and Michael Kelly appear in a scene from “House of Cards.” (AP/Netflix)

In a case of life imitating art, officials at the Department of Veterans Affairs illegally steered agency funding from its intended purpose to pay for an unrelated program.

A review by the VA inspector general’s office found that two former heads of the department’s Chief Business Office shifted $92.5 million in medical-support money toward the development of a new claims-processing system, violating federal appropriations laws. The officials wanted to avoid asking Congress for funding, according to a report on the findings released this week.

(Warning: A “House of Cards” spoiler comes next).

Fans of the Netflix series “House of Cards” will remember a similar stunt from Frank Underwood, the fictional U.S. president who raided and drained the nation’s disaster-relief fund in Season 3 to launch a massive jobs program without congressional approval.

In the VA’s real-life case, two officials tapped into the agency’s medical-support funds to avoid competing with other IT programs and “in hopes of achieving a faster delivery” of the new claims-processing system, according to the report.

Federal law requires agencies to use appropriations for their congressionally designated purposes. Every government-wide appropriations act since 2010 has tied the funding in question to “necessary expenses in the administration of medical, hospital, nursing home, domiciliary, construction, supply and research activities,” the report said.

One of the VA officials involved in the money-shifting scheme has a history of alleged transgressions with the department. The employee retired in May 2012, about one month after an inspector general’s investigation found that the individual engaged in improper contracting activities, including failing to maintain an arm’s-length relationship with two VA contractors.

The other official retired in November 2014, according to the report this week.

The VA has already spent $73.8 million of the funds that were inappropriately transferred, and the remaining $18.7 million was still slated for the claims-processing system as of August, the review found.

The VA agreed with all of the watchdog’s recommendations, which called for the agency to return the misused funds for their intended purpose, obtain money to finish the claims-processing system through appropriate channels and establish a stronger program for ensuring compliance with appropriations laws.