Secretary of Veterans Affairs Bob McDonald, at a September, 2014 press conference. (Joe Gromelski/Stars and Stripes)
WASHINGTON — The head of procurement at the Department of Veterans Affairs said Thursday that Secretary Bob McDonald never contacted him after a warning in March that the agency is misspending billions of dollars each year.
Jan Frye, deputy assistant secretary for acquisition and logistics, detailed to House lawmakers how he blew the whistle on the agency’s questionable credit card purchases and how VA officials testifying along with him planned in advance to hide the wrongdoing.
The VA was hit with its newest scandal just before the hearing Thursday when a March letter written by Frye to McDonald was made public. It unveiled that at least $5 billion and as much as $10 billion each year in employee credit card purchases were made without contracts and in violate of federal procurement rules.
“I have not had any response from the secretary’s office,” Frye testified to a Veterans Affairs subcommittee. He said an assistant to McDonald and Deputy Secretary Sloan Gibson confirmed both had received the letter.
Frye also told members of a House Armed Services subcommittee that VA leadership, including its chief financial officer and its chief procurement officer for the department’s health care system, were testifying Thursday in hopes of obscuring the purchase practices.
“We hope you won’t ask us any questions that will force us to tell you about the important pieces we’ve premeditatedly left out,” he testified. “If you happen to ask us about what we’ve failed to tell you, we hope we can answer your questions in such a way as to quickly extinguish potential follow-on questions. In short, obfuscation is our game.”
About 23,000 VA employees have credit cards designed to streamline smaller purchases, but the cards were also used to buy health care and medical devices such as prosthetics without required contracts, which opens the agency up to overpayments, defective products and fraud, according to Frye.
Frye said he wrote to McDonald in March after years of pressing the agency to clean up purchases. The secretary was confirmed by Congress last summer to revive the VA from its biggest scandal — the manipulation of patient wait times at veterans hospitals across the country — and has often spoke publicly about the value of whistleblowers.
Edward Murray, acting VA assistant secretary for management and the interim CFO, testified to the House subcommittee that he had never seen Frye’s letter to McDonald before Thursday.
“I just found out about this letter this morning,” he testified.
Some of Frye’s claims had recently been discussed by a working group within the VA, Murray said.
He agreed that the VA needs to do more and said that McDonald is also working to change the culture in the agency, which is one of the federal government’s largest bureaucracies.
“I believe I am working with him, and me and my staff are working our very utmost to make the staff more accountable and transparent,” Murray said.
He said the agency has made “tremendous strides” in fixing its long-troubled purchase card program, including a list of improvements after a scathing audit by the VA inspector general last year that found 15,600 potentially unauthorized card purchases worth $85.6 million.
The testimony raised the ire of some lawmakers.
“I guess I’m dumbfounded,” said Rep. Tim Huelskamp, R-Kan. “You’re here to speak for the VA … and you’ve never seen the allegations” in Frye’s letter.
Rep. Mike Coffman, R-Colo., chairman of the House subcommittee, said the VA attempted to block Frye from testifying in “yet another attempt to avoid responding in a fully open and candid manner” but relented at the last moment.
Coffman said the agency wanted to only send Murray, who has been in his position for about two months and does not have a full grasp of the long-term purchase card problems.
The VA purchase card program has been troubled by a lack of oversight since the 1990s, according to various audits, but the claims by Frye would be a massive increase in misuse over the past five years, a period when agency purchases more than doubled.
“I hope VA is embarrassed and ashamed about the way they treat people who try to bring problems forward,” said Rep. Jeff Miller, R-Fla., chairman of the full Veterans Affairs Committee. “I am tired of hearing the same thing over and over and over again. Nothing is changing regardless of what leadership is telling this committee.”
