Obama’s firing of watchdog stirs controversy

Tuesday, June 23, 2009

WASHINGTON — A controversy has developed over President Barack Obama's firing of the internal watchdog for the federal AmeriCorps program.

The Sacramento Bee reported June 19 that Rep. Darrell Issa, R-Calif., the ranking Republican on the House Committee on Oversight and Government Reform, had asked acting U.S. Attorney Lawrence G. Brown to explain the legal basis for a complaint he filed against Gerald Walpin to the oversight council for inspectors general on April 29.

Walpin, the national service agency's inspector general, was dismissed over his handling of an investigation of the mayor of Sacramento, Calif., Kevin Johnson, an Obama supporter during the presidential campaign. The FBI, although it has criticized Walpin’s work, is investigating allegations that an executive at a nonprofit founded by Johnson obstructed a federal inquiry into the group's spending practices.

In a letter to Congress on June 11, Obama said he had lost confidence in Walpin and was removing him from the position.

Obama's move followed an investigation by Walpin finding misuse of federal grants by a nonprofit education group, St. HOPE Academy, led by Johnson. Johnson and a nonprofit education academy he founded ultimately agreed to repay half of $847,000 in grants it had received from AmeriCorps.

Walpin was criticized by the acting U.S. attorney in Sacramento for the way he handled the investigation of Johnson and St. HOPE Academy. Prosecutors declined to file criminal charges in the AmeriCorps investigation. When the settlement was announced in April, Brown said prosecutors determined there was no fraud. Rather, they found a culture of “sloppiness” in St. HOPE's record-keeping.

Brown also criticized Walpin, for overstating information he had gathered, which prompted the criminal investigation.

The inspector general had said Johnson, a former All-Star point guard for the Phoenix Suns, used AmeriCorps grants to pay volunteers to engage in political activities, run personal errands and even wash his car.

“The allegations that form the basis for your complaint seem very ordinary, which makes the fact that you pursued sanctions against Mr. Walpin seem extraordinary by contrast,” Issa wrote to Brown, according to the Bee.

Walpin said last week that he acted “with the highest integrity” in investigating AmeriCorps and other government-funded national service programs. He said in an interview with the Associated Press that he reported facts and conclusions “in an honest and full way” while serving as inspector general at the Corporation for National and Community Service. “I know that I and my office acted with the highest integrity as an independent inspector general should act,” he said.

“It is vital that I have the fullest confidence in the appointees serving as inspectors general,” Obama said in the letter to House Speaker Nancy Pelosi, D-Calif., and Vice President Joe Biden, who also serves as president of the Senate. “That is no longer the case with regard to this inspector general.”

The president didn't offer any more explanation, but White House Counsel Gregory Craig, in a letter June 18 to Sen. Charles Grassley, R-Iowa, cited the U.S. attorney's criticism of Walpin to an integrity committee for inspectors general.

“We are aware of the circumstances leading to that referral and of Mr. Walpin's conduct throughout his tenure and can assure you that the president's decision was carefully considered,” Craig wrote.

Walpin said he gave the integrity committee “a full and complete response” that was also signed by several people who worked on the case. “I have no question but that we acted totally properly,” he said in the interview.

Grassley had written Obama a letter pointing to a law requiring that Congress be given the reasons an inspector general is fired. He cited a Senate report saying the requirement was designed to ensure that inspectors general are not removed for political reasons. Grassley said Walpin had identified millions of dollars in AmeriCorps funds that were wasted or misspent and “it appears he has been doing a good job.”

In August 2008, Walpin referred his findings in the matter to the local U.S. attorney's office, which said the watchdog's conclusions seemed overstated and did not accurately reflect all the information gathered in the investigation.

“We also highlighted numerous questions and further investigation they needed to conduct, including the fact that they had not done an audit to establish how much AmeriCorps money was actually misspent,” Brown said in his April 29 letter to the federal counsel of inspectors general.

Walpin's office made repeated public comments just before the Sacramento mayoral election, prompting the U.S. attorney's office to inform the news media that it did not intend to file any criminal charges.

In settling the case, the government agreed to lift its suspension of any future grants to the academy and Johnson agreed to immediately repay $73,000 in past grants. The academy was given 10 years to repay the remaining $350,000.

Kevin Hiestand, chairman of the board of St. HOPE Academy, said in a statement it was “about time” Walpin was removed. “Mr. Walpin's allegations were meritless and clearly motivated by matters beyond an honest assessment of our program,” he said.

Walpin, a New York attorney, was appointed by then-President George W. Bush and sworn into office in January 2007 after being confirmed by the Senate, according to a news release on AmeriCorps' Web site. Walpin graduated from College of the City of New York in 1952 and received a law degree in 1955 from Yale Law School. He was a partner with the New York City law firm Katten Muchin and Rosenman LLP for more than 40 years.

Alan Solomont, a Democrat and the board chairman of the government-run corporation, and Stephen Goldsmith, a Republican and the board's vice chair, said they strongly endorsed Obama's decision.

On June 17 Walpin disputed claims from the White House that he was “confused” and “disoriented” at an agency meeting.

In a letter sent to lawmakers June 16, Obama's special counsel Norman Eisen described Walpin as “confused, disoriented, unable to answer questions” during a May 20 meeting of the board of the Corporation for National and Community Service.

Eisen said the behavior led board members to question Walpin's capacity to serve as the internal watchdog of the government-run corporation, which oversees programs like AmeriCorps.

“To say that I'm disoriented is wild,” Walpin said in an interview with the Associated Press. “The whole thing is idiotic.”

On June 16, Sen. Claire McCaskill, D-Mo., became the first Democrat to question the administration's firing of Walpin, contending the White House failed to follow a law requiring an explanation of the reason for the dismissal. Several Republicans had previously complained. McCaskill later said she accepted Obama's explanation.

Eisen said in his letter to McCaskill, Sen. Joseph Lieberman, I-Conn., and Sen. Susan Collins, R-Maine, that Walpin was removed after a review was requested by the corporation's bipartisan board. Among other reasons, Eisen cited Walpin's absence from the corporation's headquarters in Washington.

“Mr. Walpin had become unduly disruptive to agency operations, impairing his effectiveness” and lost the confidence of the board, Eisen wrote.

Walpin said in the AP interview that when the White House asked for his resignation, the conduct at the meeting was not mentioned. “There was nothing like this that came up,” he said.

Acting U.S. Attorney Brown said he asked the FBI's Sacramento division to determine whether e-mails written by Johnson were deleted during the earlier investigation. Brown said his office learned last month that e-mails may have been destroyed. Those allegations were disclosed in an April resignation letter from the group's former executive director, which was obtained by The Sacramento Bee.

“The FBI has, in fact, opened an investigation of the circumstances surrounding the alleged destruction of e-mails, and is working with criminal prosecutors in this office,” Brown said in a statement June 17 to the Associated Press.

Brown said he would not discuss the details of the investigation.

Johnson said none of his e-mails had been lost, although he could not say if any of them had been deleted and then recovered. “Every e-mail that I had has been preserved,” Johnson told Sacramento television station KXTV. “I think the investigation will run its course, and I feel this will be behind us in the not-too-distant future.”

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