State Department's inspector general repeatedly thwarted investigations into fraud
Washington Post
By Glenn Kessler and Karen DeYoung
Washington Post Staff Writers
Wednesday, September 19, 2007; Page A21

Howard J. Krongard, the State Department's inspector general, has repeatedly thwarted investigations into contracting fraud in Iraq and Afghanistan, including construction of the U.S. Embassy in Baghdad, and censored reports that might prove politically embarrassing to the Bush administration, the chairman of the House Committee on Oversight and Government Reform charged yesterday in a 13-page letter.

The letter, addressed to Krongard and signed by the committee chairman, Henry A. Waxman (D-Calif.), who released it yesterday, said the allegations were based on the testimony of seven current and former officials on Krongard's staff, including two former senior officials who allowed their names to be used, and private e-mail exchanges obtained by the committee. The letter said the allegations concerned all three major divisions of Krongard's office -- investigations, audits and inspections.

Waxman demanded documents and testimony for a hearing next month into Krongard's conduct. A copy of the letter was sent to the committee's top Republican, Rep. Thomas M. Davis III (Va.).

A statement released by Krongard's office said he had just completed a visit to Afghanistan and was "en route to Baghdad for the remainder of September." In the statement, he described the allegations as "replete with inaccuracies including those made by persons with their own agendas" and said he looks forward to the opportunity to respond fully to the committee. White House spokeswoman Dana Perino referred questions to the State Department, where spokesman Sean McCormack said he had not yet seen Waxman's letter.

The letter alleges that Krongard "interfered with ongoing investigations to protect the State Department and the White House from political embarrassment." It said that "your strong affinity with State Department leadership and your partisan political ties have led you to halt investigations, censor reports and refuse to cooperate with law enforcement agencies."

The Senate confirmed President Bush's nomination of Krongard, who had no previous State Department experience, in May 2005. He previously worked for an international law firm and had been general counsel for Deloitte & Touche in the mid-1990s. Federal Election Commission records indicate he has contributed to both parties: $1,350 to the National Republican Senatorial Committee in 2000, for a "roast" of then-Michigan Gov. John Engler (R), and $1,000 to Democratic presidential candidate Bill Bradley in 1999. Krongard's brother, A.D. "Buzzy" Krongard, served as the No. 3 CIA official under then-Director George J. Tenet.

Waxman accused Howard Krongard of:

  • Refusing to send investigators to Iraq and Afghanistan to investigate $3 billion worth of State Department contracts.
  • Preventing his investigators from cooperating with a Justice Department probe into waste and fraud in the construction of the U.S. Embassy in Baghdad.
  • Using "highly irregular" procedures to personally exonerate the embassy's prime contractor of labor abuses.
  • Interfering in the investigation of a close friend of former White House adviser Karl Rove.
  • Censoring reports on embassies to prevent full disclosure to Congress.
  • Refusing to publish critical audits of State's financial statements.
  • Interfering in the investigation of a close friend of former White House adviser Karl Rove.
  • Censoring reports on embassies to prevent full disclosure to Congress.
  • Refusing to publish critical audits of State's financial statements.

Among the e-mails obtained by the committee are exchanges in which staff members discussed Krongard's decision not to cooperate with the Justice Department on the embassy investigation.

"Wow, as we all [k]now that is not the normal and proper procedure," an investigator wrote to John A. DeDona, an assistant inspector general. DeDona forwarded the e-mail to Deputy Inspector General William E. Todd, saying, "I have always viewed myself as a loyal soldier but hopefully you sense my frustration in my voicemail yesterday."

Todd wrote back: "I know you are very frustrated. John, you need to convey to the troops the truth, the IG told us both Tuesday to stand down on this and not assist, that needs to be the message."

DeDona responded: "Unfortunately, under the current regime, the view within INV [the office of investigations] is to keep working the BS cases within the beltway, and let us not rock the boat with more significant investigations."

Waxman's letter also said that Krongard's actions have resulted in a "dysfunctional office environment in which you routinely berate and belittle personnel, show contempt for the abilities of career government professionals and cause the staff to fear coming to work." The letter said high personnel turnover has left the office with many senior-level vacancies and only seven of 27 investigator positions filled.

The embassy, whose cost of more than $600 million has made it the most expensive U.S. diplomatic mission in the world, has been the subject of repeated congressional questioning and allegations of wrongdoing in both construction and hiring practices.

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