Recovery Blog

Training Equals Taxpayer Savings

Posted in From the Recovery Board Chair by on March 22, 2012

During the three-year history of the $840 billion economic stimulus program, the Recovery Board and its oversight partners in the Inspector General community have trained nearly 150,000 people in federal, state, and local governments. Participants learn about contracts and grant management, the requirements of the Recovery Act, and the elements of fraud both in the civil and criminal areas.

This rigorous effort to keep close tabs on the Recovery program has paid off, as demonstrated in a recent investigation at the Department of Education where I serve as the Inspector General.  Because of the quick thinking of an Education grant officer who went through an IG training course, a crook won’t be feasting on taxpayer dollars; instead, he’ll be dining on prison food for the next 30 months.

Take a step back to late 2009. William Hamel, the Assistant Inspector General for Investigation, and Marta Erceg, the Counsel to the Inspector General, put their heads together and developed a fraud awareness training program for more than 500 grant officers in the Education Department. The training, offered six different times to ensure all grant officers would be able to attend, focused on the elements of civil and criminal fraud, red flags and vulnerabilities in grant programs, and regulations on how federal funds can be spent.

“We decided we wanted people to have a better understanding of what constitutes fraud,’’ Hamel says. “About two or three days after one of the sessions, I got a call from a grant officer who said, ‘I really don’t know if there is anything there, but I just had the training session and I want to tell you about something that doesn’t look right.’”

Reviewing a purported grant award notification, the grant officer noticed that the paperwork contained a program number that did not exist in federal government files.  According to Hamel, the grant officer suspected that the paperwork was fraudulent and recommended a “further investigation.’’

As it turned out, the information provided by the grant officer led investigators to uncover what can only be described as a bizarre scheme to defraud the federal government.  In the end, the investigation undertaken by Education IG investigators in New York saved taxpayers at least $3.4 million.

The case involved a man named Robert Friedland, who was an instructor with the Prep for Success program administered by the City University of New York Research Foundation. The program prepares low-income high school students for college. According to investigators, Friedland forged a grant award notification indicating that that the Department of Education had awarded approximately $3.4 million to him.

The Education investigation also discovered that the ever creative Friedland had earlier falsified a document to get his job as an instructor. When he applied for the job in 2008, investigators said, the university’s foundation did a background check revealing he had previously been convicted of a crime. However, Friedland presented the foundation with a fraudulent court order that claimed he had been the victim of identity theft.

Friedland was convicted on three counts of fraud in June 2011. In mid-March, a federal judge in New York sentenced him to 30 months in prison.

“I think training heightens the awareness and acuity of the people we rely on to serve as our fiduciaries for the United States government,’’ Hamel says. “We train thousands of financial aid administrators every year and we get a lot of referrals from training. The Friedland case helps demonstrate the validity of our training program.’’

Kathleen S. Tighe, Chair, Recovery Board

2 Responses

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  1. The New Yorker said, on March 22, 2012 at 10:18 pm

    Good Job!!!

  2. jimbo1132001 said, on April 5, 2012 at 9:57 am

    So much for transparency. We have by my calculations a Recovery Act that is corrupt to the core. So far, our government has spent 800 BILLION with a B, to create 200,000 jobs. That’s it, or about $4,000,000 it cost the taxpayer per job. This shows either gross incompetence or corruption at the highest level, as no one else could pull this grand theft off. It is the board that needs to be investigated. If you scour where this money went, SURPRISE it went back to government giving raises to senior officials and administrators. The rest has gone to government related organizations and finally the rest of the money went to companies doing business with the government. Transparency? PLEASE! This board and the above Director will not even list themselves on this site! How can they call themselves transparent. Furthermore, none of the board members is an entrepreneur, so they are clueless about what it takes to start a company, create jobs, help an industry, working from the grass roots or having to apply for a loan or grant. Just to give this some relativity, the amount of money spent brings a tax burden of an extra $100,000 per American – This is unacceptable -

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