Some Federal Informants Minted as Millionaires

November 22, 2021

Tens of thousands of informants have helped the Federal Bureau of Investigation and Drug Enforcement Administration by giving inside information about crimes— collecting $531 million to do so in recent years. In some cases, informants have continued to commit crimes while collecting this money. 

The FBI paid informants $294 million between 2012 and 2018, and the DEA paid at least $237 million between 2011 and 2015, according to federal audits scoured by OpenTheBooks.com and published at Forbes.

While the data is a several years old, it’s the most recent available.

Some informants even became millionaires, collecting taxpayer money to squeal on their colleagues.

The Department of Justice Inspector General noted that one DEA informant was an “airline employee who received more than $600,000 in less than four years, and a parcel employee who received over $1 million in five years.”

One Amtrak employee was paid $962,615 between 2010 and 2015 to be a confidential source, which the Inspector General called “a substantial waste of government funds” because the intel “could have been obtained by DEA at no cost through a joint task force with the Amtrak Police Department.”

Federal informants often commit crimes, and often do it with the permission of their handlers, according to a 2015 General Accountability Office audit.

“For example, in the appropriate circumstance, an agency could authorize an informant to purchase illegal drugs from someone who is the target of a drug-trafficking investigation,” the audit states. “Such conduct is termed ‘otherwise illegal activity.’”

Informants have been found to be involved in both the Jan. 6 U.S. Capitol Building riot and the plot to kidnap Michigan Gov. Gretchen Whitmer.

 

 

New York Taxpayers Paid $9.5M in Cuomo Legal Fees So Far

November 23, 2021

Andrew Cuomo, disgraced former governor of New York, has cost the Empire State’s taxpayers $9.5 million and will continue to reap the benefits of a law that makes taxpayers pay legal fees for elected officials.

Cuomo resigned in August over sexual harassment allegations, while various scandals have followed him, from allegedly using state staff to help him earn $5.1 million from a book deal while the state lost 56,000 people to Covid-19, to requiring nursing homes to take in Covid-positive patients and allegedly undercounting the number of people who died there.

Taxpayers have footed the bill for his legal fees, so far costing $9.5 million, and rising ever upward.

According to Politico, that figure breaks down and includes up to $5 million for lawyers who have represented Cuomo’s office, up to $3.5 million for lawyers hired by the state attorney general to investigate sexual harassment allegations against the Democrat, and at least $1 million in bills for lawyers hired by the legislature as part of an impeachment investigation.

It doesn’t include the legal fees of Cuomo’s private attorney, Rita Glavin, whose bills are being paid by his campaign committee.

While Cuomo has been charged criminally for allegedly forcibly groping a former staff member, those charges appear not to be sticking because a sheriff in upstate New York went rogue and filed charges without the knowledge of the district attorney, who was still investigating, and without a sworn statement from the alleged victim.

So, there’s another potential significant cost in play.

That’s because state law says it will reimburse public employees for their legal feeswhen they are acquitted of criminal charges, or those charges are dismissed.

Cuomo has used his campaign committees to pay for his legal defense, so the reimbursement goes to his campaign account.

“It’s a crazy law,” said state Sen. Mike Gianaris (D-Queens), who for years has sponsored a bill to repeal it.

Crazy indeed. Taxpayers shouldn’t be on the hook for legal fees, especially for someone like Cuomo, who as of July had more than $18 million in his campaign accounts.

 

 

Feds Spent $1.2B in Taxpayer Money on Films Over 14 Years

November 24, 2021

Beyond the glitz and glamour of Hollywood, the federal government has long dipped its toe in the film industry.

While the film and video market around the world reached a value of almost $235 billion in 2020, $1.2 billion in taxpayer money was spent on video production and distribution and other related filming categories between 2008 and 2021, according to our auditors at OpenTheBooks, who looked at federal spending records from that time.

The Department of Defense was responsible for the majority of it, shelling out $721 million, more than the next eight agencies combined. NASA spent $124 million, and the Department of the Interior spent $75 million, respectively.

For example, Old Post Films, Inc. collected $16 million for “Starting Strong Season II,” part two of an infomercial series to encourage young Americans to join the Army.

Old Post Films did business through Ricky Schroder Productions, a company run by actor Ricky Schroder.

Reviewing federal contracts, that company billed taxpayers $756.17 per hour for senior executive producers for the series (annualized rate of $1.4 million), while junior executive producers made $347.46 hourly (annualized rate of $700,000).

Consultants on the series made $191.44 per hour (annualized rate of $382,000), while set medic/safety coordinators earned $78.83 hourly.

Makeup artists/hair stylists got $47.34 per hour (annualized rate of $94,000); craft services staff, which provided food and beverages, were paid $32.92 hourly, while drivers were paid $29.61 and a production secretary was paid $29.45 per hour.

Perhaps that $1.2 billion in taxpayer funds that was spent would be significant lower had the film industry not charged exorbitant rates in government contracts.

 

In 1970s, NASA Got $13.5M to Store Space Rocks

November 25, 2021

Throwback Thursday! 

What the National Aeronautics and Space Administration needed in the mid-1970s was more space to store its space rocks.

That’s what NASA said when it requested $2.8 million — $13.5 million in 2021 dollars — to build an addition to the existing Lunar Receiving Laboratory at the Johnson Space Center to house 100 pounds of moon rocks.

It’s also what earned it a Golden Fleece award in 1976 from Sen. William Proxmire, a Democrat from Wisconsin who gave awards for wasteful and nonsensical spending.

“The fiscal irony of NASA’a request is that it is not needed,” Proxmire said in his award announcement. “In 1971, after spending $8.7 million to house the moon rocks, NASA curator Dr. Michael Duke indicated that the existing building would be ‘the permanent facility for storage, handling and doing detailed studies of the rocks.’”

American taxpayers had already shelled out almost $15 billion then for the Lunar Exploration program and were being asked to pay another $2.8 million to build an addition to what Proxmire saw as “a perfectly adequate $8.7 million concrete structure to house a wheelbarrow full of moon rocks.”

NASA argued then that the new addition was needed “to ensure that the lunar samples are adequately protected against natural and man-made hazards for the foreseeable future.”

But the existing facility operated successfully since 1971 to support an active lunar sample research program with several hundred scientists, Proxmire argued.

“It’s still unclear what ‘hazards’ NASA has in mind,” Proxmire said. “The present building is a massive concrete structure. Most observers grant that almost nothing short of a bomb blast or massive earthquake could penetrate the maze of concrete buildings that make up the mammoth Johnson Space Center in Houston.”

 

 

Biden ‘Social Infrastructure’ Singles Out News Orgs for $1.7B in Tax Breaks

November 26, 2021

A provision in President Joe Biden’s Build Back Better bill would give payroll tax credits to local newspapers, costing $1.7 billion over the next five years.

The tax credit is justified as helping keep jobs in an industry that eliminates newsroom jobs regularly and leaves communities without access to critical information, according to the Associated Press.

About one-quarter of the country’s newspapers have closed and half of local journalism jobs have disappeared in the past 15 years, according to research from the University of North Carolina, leaving about 1,800 communities with no local newspaper, the AP reported.

The tax credit would be available for newspapers, digital news outlets, and radio and television stations – up to $25,000 the first year and $15,000 the next four years for up to 1,500 journalists.

Republicans have derided the $1.7 billion credit as a handout and even some journalists “acknowledge that it’s awkward to receive financial assistance from a government they cover independently,” the AP reported.

The credit is supposed to help small papers, but it will help some larger companies, including Gannett, one of the nation’s largest remaining newspaper chains, which could gain as much as $127.5 million over five years, according to an analysis by the AP.

“One basic question is why journalists deserve a subsidy more than, say, nurses or teachers?,” The Wall Street Journal editorial board asks. “Both of those professions make contributions to the public good, and we wouldn’t want to do without either one.”

While working off outdated information about the tax credit — initially, it was limited to publications with no more than 750 employees and would amount to $50,000 annually for each journalist on staff —the WSJ still makes a good point.

Why single out an industry less popular than Congress to receive tax credits?

The #WasteOfTheDay is presented by the forensic auditors at OpenTheBooks.com.