As chatter continues about the prospect of a Hillary Clinton Presidency in 2016, an Inspector General report raises new questions about the former Secretary of State’s leadership abilities. The report released this week details how the State Department misplaced $6 billion in taxpayer funds due to improper filing of contracts, mostly during Clinton’s tenure as top diplomat.
The State Department’s new Inspector General Steve Linick issued a special “management alert” warning that the Department’s mismanagement of the $6 billion over the past six years, four of which were during Clinton’s tenure, “creates significant financial risk and demonstrates lack of internal control …”
The report outlines numerous examples of “poor contract file administration” that create “conditions conducive to fraud, as corrupt individuals may attempt to conceal evidence of illicit behavior by omitting key documents from the contract file.”
For example, the IG noted that contract documents related to the U.S. war in Iraq could not be located in 33 out of 115 cases.
From the report:
The value of the contracts in the 33 missing [Iraqi War] files totaled $2.1 billion. Forty-eight of the 82 contract files received did not contain all of the documentation required by FAR 4.8. The value of the contracts in the 48 incomplete files totaled an additional $2.1 billion. An ongoing OIG audit of Bureau of African Affairs contracts revealed that CORs were unable to provide complete contract administration files for any of the eight contracts that were reviewed. The value of these contracts totaled $34.8 million.
In other instances the IG report indicates that the State Department failed to follow up on contracts to ensure that funds were properly used. The report provided one example wherein a $2.5 million contract lacked status reports or a tally of the amount of funding left for the contract.
The IG suggested that the State Department put a centralized system in place to track and maintain contract files and also to implement random checkups on contracts.
Linick’s “management alert” is only the second such urgent IG report in State Department history. The first, also issued by Linick in January, outlined “significant and recurring weaknesses in the Department of State Information System Security Program.”
President Barack Obama nominated Linick for the State Department’s Office of Inspector General last summer after the position had been vacant for five years, longer than any other Federal IG vacancy in the Nation’s history and most of Clinton’s tenure at the Department.