Watchdogs fired a double-barrel shot at the Trump administration for ethical lapses last week, ruling the Health and Human Services Department should have stopped its former secretary’s lavish travel plans, and that current Commerce Secretary Wilbur L. Ross Jr. is financially entangled with businesses he shouldn’t be.
The HHS inspector general said the agency flouted federal regulations when it let former Secretary Tom Price, who departed in September, use chartered planes instead of looking for cheaper options, squandering $341,000 in federal funds.
Most notably, HHS failed to compare the cost of a dozen chartered plane trips to commercial alternatives, and it did not properly authorize the use of exclusive travel.
The U.S. Office of Government Ethics, meanwhile, took issue with a current Cabinet member — Mr. Ross — for failing to divest himself of certain holdings and “various omissions and inaccurate statements” in forms he submitted to the office, prompting the commerce secretary to pledge he’d take action.
Mr. Ross has been under scrutiny for holdings related to a shipping company with ties to Russian interests, and his decision to “short” the stock so that he’d benefit if the stock’s value decreased.
“Your failure to divest created the potential for a serious criminal violation on your part and undermined public confidence,” wrote David J. Apol, acting director and general counsel of the ethics office.
The scoldings arrived one week after Scott Pruitt resigned as administrator of the Environmental Protection Agency amid a torrent of reports of ethical lapses and questionable spending.
Mr. Price, a former congressman, flew around the country during his short tenure as health secretary to trumpet efforts to reverse the opioid epidemic and to highlight issues such as obesity and mental health.
Besides chartered planes, he used the military and presidential fleets or commercial airlines for nine trips.
Yet a series of Politico reports about his chartered travel raised eyebrows, ultimately leading to the secretary’s resignation and decision to reimburse taxpayers nearly $60,000 for the price of his seat and, in some cases, a seat his wife used.
The inspector general said it reviewed contracts with two vendors totaling about $480,000 for Mr. Price’s 12 trips on chartered planes.
In each case, HHS couldn’t prove that it compared chartered trips to commercial flights, even though it is supposed to find the options most advantageous to the government and taxpayers.
The IG report provided some examples:
• In June, HHS reserved a chartered flight to Nashville for business events because the secretary was poised to head to the White House for a meeting. The agency didn’t bother to cancel the $17,760 flight and find a cheaper option when the White House meeting was called off two days prior to the trip.
• Later in June, Mr. Price flew to California and then to Aspen, Colorado, and to Salt Lake City, Utah, chalking up $50,000 in chartered flight costs for 3 1/2 hours of official engagements.
The inspector general said in both instances, it was impossible to check the availability of commercial airline seats for those days, but flights that would have accommodated his schedule did exist
• In September, Mr. Price flew to Philadelphia at the cost of about $15,000 for an opioids roundtable and tour of an addiction center in the morning, before returning to the capital for a meeting with Vice President Mike Pence. The IG reports says HHS could have arranged his meeting so that commercial rail or car travel was feasible, while still making his appointment with Mr. Pence.
The IG report also says HHS didn’t always select the lowest-quoted price on charter flights, nor were the trade-offs of selecting the higher price justified.
One such flight, a one-way trip from Seattle to D.C. cost $121,500 and accounted for about a quarter of the costs racked up by Mr. Price’s chartered flights overall.
The report says there was another chartered flight quoted at $75,000, plus commercial flights around the same time on Aug. 25 that would have gotten the secretary back to D.C. in time to prepare for a conference call on a looming hurricane in Texas.
A big part of the problem, the IG report said, is that Mr. Price’s scheduling team would select events before figuring out how he’d get there.
“Without making the mode of transportation a primary consideration during the scheduling process, the team limited the available transportation options that were most advantageous to the government and that would enable former Secretary Price to arrive at scheduled events on time,” the report said.
Investigators said in some cases, chartered flights were authorized during or after the trip, instead of ahead of time, and three trips either started or ended in his home state of Georgia, rather than an official post, resulting in unnecessary costs.
The IG report says the agency should find a way to recoup $333,000 related to the authorization and use of chartered aircraft, nearly $5,000 related to travel that started or ended in places other than Mr. Price’s duty station and nearly $3,000 in other excess travel costs.
Nicholas Peters, a spokesman for Mr. Price, said the inspector general did not attempt to interview the former secretary, and there is “no indication in the IG report that the paperwork and regulatory issues of department staff were anything other than good faith mistakes.”
“The department understands the auditor’s concern that the processes and record keeping regarding travel could have been more comprehensive, and, since the period examined by the audit, HHS has instituted new travel review procedures applicable to all political appointees,” he said. “It must be noted, though, that the work of an audit is to review compliance with procedures, not make legal conclusions. As a matter of law, none of the travel at issue was unauthorized.”
Mr. Ross said his ethics agreement allowed him to retain some private equity holdings, though to “maintain the public trust,” he asked that his equity holdings be sold and the proceeds placed in U.S. Treasury securities.
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