WASHINGTON — The General Services Administration inspector general said Monday that he’s investigating possible bribery and kickbacks, as a central figure in a GSA spending scandal asserted his right to remain silent at a congressional hearing.
Members of the House Oversight and Government Reform Committee voiced outrage at the scandal ignited by disclosure of a 2010 conference at a Las Vegas resort that cost taxpayers more than $800,000.
The former GSA chief who resigned because of it apologized, saying, “I will mourn for the rest of my life the loss of my appointment.” Martha Johnson said the conference “had evolved into a raucous, extravagant, arrogant, self-congratulatory event.” But she approved a $9,000 job-performance bonus for its organizer last year, against the recommendation of a deputy director, while the conference was being investigated.
Jeffrey Neely, who set up the conference and took the Fifth Amendment before the committee Monday, has been placed on leave as a regional executive in Western states.
Toward the end of the three-and-a-half hour hearing, GSA chief of staff Michael Robertson said he had informed the White House of the inspector general’s preliminary findings last year. Robertson testified that he told a White House lawyer, Kim Harris, about the report shortly after May 2011 “when I became aware that the IG had briefed (then-GSA administrator Martha) Johnson.”
The White House had no immediate comment.
Committee Chairman Darrell Issa, R-Calif. said the panel hoped to learn why it took GSA bosses 11 months to alert the White House to the scandal and why they approved a bonus last year for Neely.
Rep. Elijah Cummings, D-Md., the panel’s ranking member, called the situation “indefensible” and “intolerable. It’s not your money, it’s the taxpayers’ money,” Cummings said as he scolded agency officials seated at a witness table. He said he hopes at least some of the money spent might be recouped from officials involved.
GSA officials later confirmed that the agency has sent letters to former Public Building Services director Robert Peck, Neely, and Robert Shepard, another official in GSA’s western region, naming them as responsible for the unacceptable expenditures. Peck is slated to testify today at the House Transportation and Infrastructure Committee, one of the three other committees also looking at the conference spending and waste at the agency in charge of federal buildings and supplies.
Inspector general Brian Miller, responding to a question at Monday’s hearing, said, “We do have other ongoing investigations, including all sorts of improprieties, including bribes, including possible kickbacks.”
Neely could face a criminal investigation by the Justice Department.
The Las Vegas conference cost $$823,000 and taxpayers picked up the tab for a clown, a mind-reader, bicycles for a team-building exercise.
Johnson, whom lawmakers accused of sitting on the findings for 11 months after receiving an interim briefing from the inspector general, apologized “to the American people for the entire situation. ... As the head of the agency, I am responsible. I deeply regret that the exceedingly good work of GSA has been besmirched,” she said.
Previously, Neely had told inspector general investigators that a $2,700 party he threw in his Las Vegas hotel suite was an employee-awards event, according to a transcript of the interview.
The investigator confronted Neely with his email saying that he and his wife “are hosting a party in our loft room. There will be wine and beer and some munchies.” There was no mention of awards.
“I get it that it looks funny,” Neely said.
The Oversight Committees released internal memos that showed GSA officials debated last year, when they knew the inspector general was investigating the conference spending, whether to give Neely a bonus for his job performance.
Johnson granted him a $9,000 bonus over the objection of Deputy Administrator Susan Brita. Brita wrote in a November 2011 email, “based on what we know already” about the conference and a questionable awards program, “I would not recommend a bonus.”
Johnson wrote in an email, “yes on a bonus” in part because Neely had to serve in an acting capacity “forever and a day.”
The Associated Press and Washington Post contributed to this article.
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