[Congressional Record Volume 145, Number 152 (Tuesday, November 2, 1999)]
[Senate]
[Pages S13641-S13657]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
[[Page S13641]]
DOD INSPECTOR GENERAL
Mr. GRASSLEY. Mr. President, it is with a feeling of disappointment
that I come to the floor today. What's bothering me is a disturbing
report I am releasing today on the Office of the Inspector General, or
IG, at the Department of Defense, DOD.
This is about a report prepared by the Majority Staff of the
Judiciary Subcommittee on Administrative Oversight and the Courts, of
which I am the Chairman.
I have always had such great respect for the DOD IG. I have always
thought that we could rely on that office to be fair and independent
and thorough, and above all, honest.
In the past, I always felt like I could trust the DOD IG's judgment.
This report, Mr. President is disturbing.
The evidence in this report questions the credibility of the IG's
investigative process. And it raises questions about the judgment of
the Acting IG, Mr. Donald Mancuso.
It is a report on the Oversight Investigation of allegations of
misconduct at the Defense Criminal Investigative Service, or DCIS. DCIS
is the criminal investigations arm of the DOD IG.
The allegations examined by the Staff involve possible misconduct by
DCIS agents between 1993 and 1996.
The current Acting DOD IG, Mr. Mancuso, is associated with the
allegations. Mr. Mancuso was the Director of DCIS from 1988 until 1997,
when he became the Deputy DOD IG.
I also understand that Mr. Mancuso is a potential candidate for
nomination to be the next DOD IG.
In June 1999, the Staff was approached by a former DCIS agent, Mr.
William G. Steakley.
Mr. Steakley raised numerous allegations regarding prohibited
employment practices at DCIS, but these were far too extensive and
complex to be examined by my small Subcommittee staff.
However, one of Mr. Steakley's allegations caught our attention. This
was the allegation that DCIS officials had ``made false statements'' in
adverse reports on his conduct.
Mr. Steakley alleged that an agent assigned to the DCIS internal
affairs unit, Mr. Mathew A. Walinski, had a history of falsifying
investigative reports to damage the reputations of fellow agents.
Mr. Steakley further alleged that senior DCIS management, including
Mr. Mancuso, was fully aware of the allegations about this agent's
unethical practices, yet failed to take appropriate corrective action.
And Mr. Steakley claimed he had proof to back up the allegations.
The staff conducted a careful examination of these allegations and
concluded that some have merit.
To evaluate the allegations, the staff reviewed numerous documents to
include the extensive files at the Office of Special Counsel, OSC, DOD
personnel files, and DCIS investigative reports. The staff also
conducted a number of formal interviews.
A careful review of all pertinent material makes one point crystal
clear:
The evidence shows that Mr. Walinski fabricated his reported
interview of the Air Force payroll technician, Ms. Nancy Gianino, on
May 21, 1993. This reported interview was conducted in connection with
the investigation of possible tax evasion charges against Mr. Steakley.
In addition, OSC files contain numerous references to a second
internal affairs case handled by Mr. Walinski, in which he apparently
fabricated another report.
When the staff asked the DOD IG for this case file--known as the
Johanson stolen gun case, they discovered that Mr. Walinski had
apparently fabricated the reported interview of Agent Jon Clark on
March 2, 1994 and possibly others. This file contains sworn statements
by the agents involved that Walinski's reported interview with Clark
never took place.
These two cases--when taken together--show that Mr. Walinski has a
history of falsifying reports.
And more importantly, the record shows that rank and file complaints
about Mr. Walinski's unethical investigative practices went directly to
top DCIS management, including Mr. Mancuso.
The record also shows DCIS management knew about the Walinski problem
but failed to take appropriate corrective action.
Yet despite rank and file complaints, Mr. Walinski's false reports
were used by DCIS management to discredit and punish Agents Johanson
and Steakley.
In January 1999, Mr. Walinski was allowed to transfer to another
federal law enforcement agency--the Treasury IG--with no record of
punishment or accountability. In his new assignment, Mr. Walinski is
still responsible for investigating employee misconduct.
In fact, the record shows that at least 3 weeks after DCIS management
was informed that Mr. Walinski had fabricated the Clark interview, he
was given a generous cash bonus award.
Moreover, Mr. Walinski was assigned to conduct an inspection of the
field office where rank and file complaints about his false reports had
originated.
While investigating Mr. Steakley's allegations, the staff discovered
that the DCIS internal affairs unit--to which Mr. Walinski was
assigned--was directed by Mr. Larry J. Hollingsworth.
Mr. Hollingsworth was convicted of a felony in U.S. District Court in
March 1996. He was apprehended and confessed to filing a fraudulent
passport application after a fellow agent recognized his photo in a law
enforcement bulletin.
The government authorities, who investigated Mr. Hollingsworth's
criminal conduct, believe that he committed about 12 overt acts of
fraud. These overt acts of fraud were committed while Mr. Hollingsworth
was Director of the DCIS internal affairs unit--Mr. Walinski's office.
Mr. President, can you imagine that? The head of the internal affairs
unit of DOD's criminal investigative division was committing passport
fraud. That's certainly a confidence builder in that organization,
isn't it?
These authorities further believe Mr. Hollingsworth's actions were
especially disturbing since passport fraud is usually committed in
furtherance of a more serious crime, but the underlying crime was never
discovered.
Although Mr. Mancuso and Mr. Hollingsworth were considered friends by
associates, Mr. Mancuso failed to recuse himself from administrative
actions affecting Mr. Hollingsworth.
Mr. Mancuso even aided in Hollingsworth's defense during criminal
trial proceedings--even though Mr. Hollingsworth was considered
uncooperative.
What's more, Mr. Mancuso endorsed an outstanding performance rating
for Mr. Hollingsworth three weeks after he confessed to felonious
activity to U.S. State Department special agents.
Mr. Mancuso even wrote a letter on official DOD IG stationary to the
sentencing judge, Judge Ellis, on the convicted felon's behalf.
In this letter, he asked the judge to consider extenuating
circumstances. He told the judge that Mr. Hollingsworth had taken a
half day's leave to file the fraudulent passport application.
Evidently, Mr. Mancuso thought that taking leave to commit a crime was
sonehow exculpatory.
This is what Mr. Mancuso said in his letter to Judge Ellis, and I
quote: ``Mr. Hollingsworth could have come and gone as he pleased,''
but he ``took leave to commit a felony.''
Mr. Mancuso concluded with this telling remark: ``To this day, there
is no evidence that Mr. Hollingsworth has ever done anything improper
relating to his duties and responsibilities as a DCIS agent and
manager.''
Coming from a law enforcement officer like Mr. Mancuso, these words
defy understanding. The last time I checked, part of doing your job as
a law enforcement officer is not committing crimes.
Mr. Hollingsworth confessed to and was convicted of felonious
activity while employed by DCIS as a criminal investigator.
As State Department agents put it, these crimes were committed in the
furtherance of a more serious crime that was never discovered.
Unfortunately, Mr. Mancuso seems to have been completely blind to the
problem.
As a result of a series of decisions--personally approved by Mr.
Mancuso, Mr. Hollingsworth was allowed to remain in an employed status
at DCIS for 6 months after his felony conviction. He was then allowed
to retire with a full federal law enforcement annuity exactly on his
50th birthday in September 1996.
[[Page S13642]]
Had Mr. Mancuso exercised good judgement and other available legal
options, Mr. Hollingsworth could have been removed from DCIS
immediately after conviction--in March 1996. Under these circumstances,
he would have been forced to wait 12 years--until the year 2008--to
begin receiving a non-law enforcement annuity commencing at age 62. Had
Mr. Mancuso exercised this option, he would have saved the taxpayers at
least $750,000.00, which is the amount of money Mr. Hollingsworth will
collect thanks to the generous treatment he received from his friend
and colleague, Mr. Mancuso.
Think of the signal this sends to rank and file law enforcement
officers who look to their managers for leadership and fair treatment.
The office of the DOD IG demands the highest standards of integrity,
judgment, and conduct.
Does Mr. Mancuso meet those standards?
Given Mr. Mancuso's poor judgment and his irresponsible handling of
the three cases examined in the staff report, I believe it is
reasonable to question:
(1) Whether Mr. Mancuso should now be nominated and confirmed as the
DOD IG;
(2) Whether Mr. Mancuso should be allowed to remain in the post he
now occupies--Acting DOD IG;
And given the evidence that Mr. Walinski falsified several
investigative reports, it is reasonable to question whether he should
be assigned to a position at the Treasury Department in which he is
responsible for conducting criminal and administrative inquiries.
Mr. President, today I am forwarding the Majority Staff report to the
appropriate committees, the Secretaries of Defense and Treasury and
other officials.
These officials must evaluate Mr. Mancuso's fitness to serve as the
DOD IG as well as Mr. Walinski's continued assignment as a criminal
investigator.
I hope they will take the time to review this report before making a
final decision on these matters.
Mr. President, I now ask unanimous consent to have printed two
documents in the Record: (1) A letter of comment from Mr. Mancuso; and
(2) the Majority Staff report. I know it's a lengthy report, and the
GPO says it will cost $2,282.00 to print. But leaving no stone unturned
in ensuring that a person of the highest integrity occupies the key
watch dog post of DOD IG is well worth that cost, in my view.
There being no objection, the material was ordered to be printed in
the Record, as follows:
Majority Staff Report to the Chairman on the Oversight Investigation--
The Defense Criminal Investigative Service, Department of Defense
(U.S. Senate Judiciary Subcommittee on Administrative Oversight and the
Courts, October 1999, Senator Charles E. Grassley, Chairman)
Executive Summary
The Majority Staff for the Senate Judiciary Subcommittee on
Administrative Oversight and the Courts has conducted an
inquiry into the personnel practices and conduct of certain
agents within the Defense Criminal Investigative Service
(DCIS). The DCIS is an agency in the Office of the Department
of Defense (DOD) Inspector General (IG). The former Director
of DCIS--a sworn federal law enforcement officer--is now
Acting DOD IG, Mr. Donald Mancuso. Mr. Mancuso was Director
of DCIS from 1988-1997. Mr. Mancuso is currently a potential
candidate for nomination to be the next DOD IG.
This staff report contrasts DCIS personnel management
practices that condoned and encouraged maltreatment of rank
and file agents, including the use of falsified investigative
reports, while protecting and rewarding a fellow manager who
was a convicted felon. Management's favorable treatment of
the convicted felon, Mr. Larry J. Hollingsworth, will result
in his receiving substantial sums of money in federal law
enforcement retirement annuities between 1996 and the year
2008. If DCIS management had exercised good judgment and
other more reasonable options, Mr. Hollingsworth would not
have been allowed to retire on his 50th birthday and receive
the $750,000.000 in benefits. He would have had to wait 12
years to retire. In another matter, a criminal investigator,
who falsified reports. Mr. Mathew A. Walinski, also received
a cash bonus award after this misconduct was brought to the
attention of senior DCIS management.
The staff report cites three separate personnel cases
brought to the Subcommittee's attention involving DCIS. Each
of these cases involves questionable personnel practices that
were either condoned or ignored by DCIS management between
1993 and 1996.
The Subcommittee on Administrative Oversight and the Courts
has primary jurisdiction and oversight authority for
administrative practices and procedures throughout the
Federal Government. As part of the process of conducting its
oversight responsibilities, the Subcommittee has been
examining administrative procedures followed by various
inspectors general. This report reflects the Subcommittee
Majority Staff's review of questionable administrative
decisions and misconduct within the criminal investigative
branch in the DOD IG's office--DCIS, while Mr. Mancuso was
the director of the organization.
background
In June of 1999, the Subcommittee Majority Staff was
approached by a former agent of DCIS, Mr. Gary Steakley. Mr.
Steakley alleged that a DCIS internal affairs Special Agent,
Mr. Walinski, had a history of falsifying official reports to
damage the reputations of fellow agents. Mr. Steakley also
alleged that senior officials at DCIS were fully aware of
this agent's questionable practices, yet failed to take
appropriate corrective action.
It should be noted that an investigator in the Office of
Special Counsel (OSC), Mr. William Shea, also looked into Mr.
Steakley's allegations of DCIS misconduct. OSC concluded that
Mr. Steakley was not a victim of prohibited personnel
practices. While the staff examined the conduct of DCIS
supervisors in regard to several specific decisions, it did
not attempt to examine the numerous other allegations raised
by Mr. Steakley.
While investigating Mr. Steakley's allegations, the staff
learned that Mr. Walinski was supervised by Mr.
Hollingsworth--the director of internal affairs. Mr.
Hollingsworth was convicted of a felony in April 1996.
Nonetheless, management allowed him to retire with full
federal law enforcement retirement benefits six months after
his felony conviction. Federal law enforcement agencies
commonly remove an employee on criminal misconduct alone, or
at a minimum, immediately after a felony conviction. Had
management availed itself of other appropriate legal removal
options, Mr. Hollingsworth would not have been allowed to
retire on his 50th birthday, which gave him entitlement to
benefits amounting to more than three quarters of a million
dollars.
The staff reviewed numerous documents to include the above-
referenced OCS investigation, DOD personnel files, DOD
investigative reports, a Subcommittee-requested review by the
Office of Personnel Management (OPM), State Department
Diplomatic Security investigative reports, and public court
papers registered in the U.S. District Court for the Eastern
District of Virginia. The Subcommittee Majority Staff also
conducted the following formal interviews:
Former DOD personnel:
Mr. Matthew Walinski, DCIS Special Agent Internal Affairs
Mr. Larry Hollingsworth, DCIS Director of Internal Affairs
Mr. William Dupree, Deputy Director of DCIS
Ms. Eleanor Hill, Former DOD Inspector General
Current DOD personnel:
Mr. Donald Mancuso, Former Director of DCIS and Current
Acting IG for DOD
Ms. Jane Charters, DCIS Investigative Support
Ms. Donna Seracino, Director of Personnel for DCIS
Ms. Linda Martz, Employee Relations Specialist
Mr. Paul Tedesco, DCIS liaison agent in Hollingsworth
criminal case
Mr. John Keenan, Current Director of DCIS, formerly Dir.,
DCIS Operations
Mr. Thomas Bonner, Current Agent in Charge Dallas Office,
DCIS, Assist. Dir DCIS Internal Affairs
Ms. Nancy Gianino, Air Force Payroll Specialist
Lt. Col. Greg McClelland, DOD IG Administrative
Investigator
State Department Personnel:
Special Agent Robert Starnes and Special Agent Sean O'Brien
Office of Special Counsel:
Investigator William Shea
Current and former DCIS Special Agents were also
interviewed on a confidential basis. They requested
confidentiality out of fear of reprisal. This report will
show fears of such reprisal are plausible based on the facts
developed by the Subcommittee.
summary of significant findings
The case of convicted felon Mr. Hollingsworth
Mr. Hollingsworth was the Director of internal affairs for
DCIS from April 1991 to September 1996. This unit routinely
conducted investigations regarding the integrity and
conductor of agents in DCIS. As stated above, in at least two
cases, DCIS management had knowledge of false witness
statements by an internal affairs agent, Mr. Walinski.
Former Director of DCIS, Mr. Donald Mancuso, assisted Mr.
Hollingsworth in remaining in an employed status--as Director
of internal affairs--for six months after his felony
conviction in U.S. District Court. Law enforcement
authorities, who investigated Mr. Hollingsworth's criminal
activities, believe that he committed at least 12 acts of
overt fraud while head of the DCIS internal affairs unit.
Mr. Mancuso, a sworn federal law enforcement officer, aided
in the defense of this particular subordinate at his criminal
trial. At no time did Mr. Mancuso offer to recuse himself
from administrative or personnel actions
[[Page S13643]]
in regards to Mr. Hollingsworth--even though they were
considered ``close personal friends.''
Mr. Mancuso endorsed an outstanding performance evaluation
of Mr. Hollingsworth three weeks after he confessed to
felonious activity to the U.S. State Department special
agents.
Using official DOD IG stationery, with DOD IG emblem, Mr.
Mancuso wrote to the sentencing judge on the convicted
felon's behalf, even though the State Department
investigators opined Mr. Hollingsworth was an uncooperative
defendant. Mr. Mancuso signed the letter in his official
capacity as an Assistant Inspector General.
Former DOD Inspector General Eleanor Hill stated that Mr.
Mancuso did not advise her of pertinent facts in the case.
Ms. Hill had directed Mr. Mancuso to remove Mr. Hollingsworth
from his position ``as soon as legally possible.''
Mr. Mancuso directly assisted Mr. Hollingsworth in
obtaining over three quarters of a million dollars in full
federal law enforcement retirement benefits six months after
a felony conviction. OPM retirement experts, legal counsel at
DOD's Washington Headquarters Service, and Inspector General
regulations all state that Mr. Mancuso had options to remove
this employee immediately after conviction. In fact, the law,
DOD regulations, and an OPM opinion all suggest that Mr.
Hollingsworth could have been removed based on the criminal
conduct alone, and not on criminal court procedures.
The retirement benefits given to Mr. Hollingsworth were
extremely generous, since federal law enforcement officials
may retire at ago 50 instead of age 62, and computation of
their general schedule grade has law enforcement availability
pay of up to 25% added in on top of regular pay. This
resulted in a convicted felon being able to obtain
approximately $750,000.00 in additional annuity payments
(excluding cost-of-living allowances) as compared to what he
would have received had he been terminated immediately after
conviction and allowed only non-law enforcement civil service
retirement benefits commencing at age 62 in the year 2008.
Falsification of Witness Statements by Agent Walinski in
Steakley Case
There were numerous claims of misconduct made by Mr.
Steakley in regard to the conduct of the DCIS office of
internal affairs. Several of Mr. Steakley's allegations were
substantiated.
There is credible evidence that at least one agent assigned
to DCIS internal affairs, Agent Walinski, falsified a witness
statement in support of a tax evasion charge against Mr.
Steakley, and was reprimanded and reassigned for a similar
problem in another internal affairs case. Agent Walinski even
acknowledged that the tax evasion charge was ``unresolved''
and that his inconclusive findings were not made apparent in
his report to the DCIS Administrative Review Board (ARB).
The false tax evasion charge in which Mr. Steakley was
eventually exonerated was instigated by DCIS management, to
include Mr. Mancuso, in an area in which DCIS had no
authority or jurisdiction. The States of California and
Virginia repeatedly informed DCIS that the agency could not
obtain Mr. Steakley's tax records without a court order or
authorization from the taxpayer involved. DCIS had neither.
In an interview with the Subcommittee staff, Lt. Col. Greg
McClelland, an independent DOD IG investigator assigned to
review allegations by Mr. Steakley, characterized the conduct
of Agent Walinski in this case as ``egregious.'' The
Subcommittee staff has substantiated evidence that Agent
Walinski made false statements to Lt. Col. McClelland in
sworn testimony in 1997.
Mr. Steakley's attorney, Mr. Luciano A. Cerasi of the
Federal Law Enforcement Officers Association (FLEOA),
notified DCIS management that Agent Walinski's witness
interview of an Air Force payroll technician was falsified.
DCIS management ignored Mr. Cerasi's allegations despite the
fact that it had received another FLEOA letter alleging that
Agent Walinski had falsified witness statement in a separate
internal affairs investigation.
Falsification of Witness Statements by Agent Walinski in
Johanson Case
Prior to the adjudication of the Steakley case, Agent
Walinski had falsified witness statements against another
DCIS agent.
DCIS Agent Stephen Johanson had his undercover weapon
stolen from his residence near Los Angeles, California while
he was participating in the execution of a search warrant in
another California city. In the investigation that followed
the theft of Johanson's weapon. Agent Walinski falsified more
witness statements. His false reports resulted in a
recommendation that Agent Johanson be suspended without pay
for 8 calendar days for failing to secure and return an
issued weapon. DCIS supervisors and rank and file agents
protested to management at DCIS headquarters in Washington
that Agent Walinski's interviews were either inaccurate or
never took place.
FLEOA attorney Cerasi wrote a second letter to top DCIS
management supporting rank and file agents' complaints about
Agent Walinski's reports in the Johanson case. Mr. Cerasi
alleged that Agent Walinski has falsified his interview of
Agent Jon Clark.
DCIS officials claim that Agent Walinski was reprimanded
for ``failing to show due diligence and accuracy'' in
reporting witness interviews in the Johanson case. Agent
Walinski reported an interview of DCIS Agent Clark that never
took place. Despite these allegations, personnel records
indicate that Agent Walinski received a cash award--at least
18 days after rank and file agents had formally complained to
senior management at DCIS headquarters that Agent Walinski
falsified reports. The staff could find no evidence that DCIS
management ever attempted to determine if the allegations
about Mr. Walinski's reports had merit. In fact, immediately
following the first Johanson investigation and while the re-
investigation was in progress, Mr. Walinski was assigned a
leadership role in the inspection of the field office where
the complaints about his reports had originated. This could
be viewed as a retaliatory measure to silence the agents who
had ``blown the whistle'' on Agent Walinski.
DCIS now records all witness interviews for accuracy. Some
DCIS Agents refer to this new practice as ``the Walinski
rule.''.
report format
This report has been divided into three separate DCIS
personnel cases as follows:
--The Case of Mr. Hollingsworth
--The Case of Mr. Steakley
--The Case of Mr. Johanson
In addition, the report includes written comments from the
Acting DOD IG, Mr. Mancuso, along with an extensive list of
the source documents used in preparing the report.
On September 27, 1999, Mr. Mancuso requested that he be
given the opportunity to review this report prior to its
release and to provide written comments. In response, the
Subcommittee Chairman, Senator Charles E. Grassley, assured
Mr. Mancuso that his written response would be attached to
the staff report. Consistent with the Chairman's commitment,
Mr. Mancuso's written response, dated October 1, 1999, is
included at the end of the report.
The attachments listed at the end of each section of the
report are far too voluminous to reproduce in the printed
report. A complete set of the attachments will be maintained
in the Subcommittee files and available on Judiciary
Committee's web site along with other Committee documents.
conclusions
The three personnel cases, which the staff reviewed,
demonstrate disparate treatment given to DCIS employees by
senior management.
Mr. Hollingsworth, a high ranking DCIS official, was
convicted of a felony but protected by Mr. Mancuso and
allowed to retire 6 months later--on his 50th birthday--with
a full law enforcement annuity. Mr. Walinski falsified
reports to such a degree that several witness statements
appearing in his investigative reports never took place. He
even claimed in sworn testimony in 1997 that a DOD employee,
whom he had interviewed and reported absent from her office
due to ``extended illness,'' had ovarian cancer, despite the
fact there was no evidence that this person suffered from
such a disease. Mr. Walinski received a cash bonus award
weeks after allegations about his falsified reports reached
senior DCIS management. DCIS management never attempted to
determine whether those allegations had merit, and Mr.
Walinski was allowed to transfer to another law enforcement
agency--Treasury IG--with no record of accountability.
Two other DCIS employees were the subject of disciplinary
action by DCIS management for significantly less serious
offenses, and in one case, based on no evidence. Mr.
Steakley, repeatedly and unjustly accused of numerous
misconduct charges, is now retired with a damaged reputation
among the federal law enforcement community that was
undeserved. Similarly, Mr. Johanson was undeservedly punished
for having a gun stolen from his residence during a burglary.
This gun was issued to him by his own agency. The initial
punishment proposed for Mr. Johanson was based on false
witness interviews and a distorted interpretation of
disciplinary guidelines.
The Office of the DOD Inspector General is a position that
requires a very high standard of integrity, with equal
treatment for all departmental employees. When information is
developed on the criminal misconduct of a senior employee
such as Mr. Hollingsworth, that employee should be removed
``as soon as legally possible'' to ensure that the morale of
all employees is maintained. When allegations are made of
misconduct such as against Mr. Walinski, the IG's office
should ensure that allegations are professionally and
thoroughly investigated, and all discrepancies are resolved.
When allegations are made against employees such as Mr.
Steakley and Mr. Johanson, charges should be investigated,
witnesses should be accurately interviewed, and bias should
not interfere with the integrity or facts in the
investigation.
If DCIS--under Mr. Mancuso's management--could not
investigate its own employees honestly and fairly, then how
could the much larger Office of the DOD IG--if managed by Mr.
Mancuso--be expected by the American people to investigate
honestly and fairly misconduct and fraud within the entire
Department of Defense?
Given Mr. Mancuso's poor judgment and his irresponsible
handling of the three cases examined in this report, it is
reasonable to question: 1) Whether Mr. Mancuso should now be
nominated and confirmed as the DOD
[[Page S13644]]
IG--an office that demands the highest standards of
integrity, judgment, and conduct; and 2) Whether Mr. Mancuso
should be allowed to remain in the post of Acting DOD IG. In
addition, given the evidence that Mr. Walinski falsified
several witness interviews, it is reasonable to question
whether Mr. Walinski should be assigned to a position in
which he is responsible for conducting criminal or
administrative inquiries.
recommendations
1. The Majority Staff recommends that Members consider a
change in legislation regarding federal law enforcement
officers convicted of felonies. Consideration should be given
to whether federal law enforcement officers should be
immediately dismissed after their conviction of a felony.
Under current law, agencies have considerable discretionary
authority in determining how to handle such cases. In the
Hollingsworth case, a series of personnel actions approved by
DOD Acting Inspector General Mancuso raise serious questions
about his integrity and judgment. The proposed change in
legislation could eliminate any discretionary authority on
the part of individual law enforcement agencies in dismissing
employees convicted of felonies.
2. The Majority Staff recommends that the Chairman forward
this report to appropriate committees, the Secretaries of
Defense and the Treasury and other officials who must
evaluate Mr. Mancuso's fitness as a potential candidate to be
DOD IG, as well as Mr. Walinski's continued assignment as a
GS-1811 criminal investigator.
THE CASE OF MR. HOLLINGSWORTH
Mr. Larry J. Hollingsworth, former GS-15 Director of
internal affairs, DCIS, was convicted of a felony charge in
1996 in U.S. District Court for the Eastern District of
Virginia. Mr. Hollingsworth was never terminated by DCIS and
allowed to retire on his 50th birthday--six months after a
felony conviction. He is currently receiving full federal law
enforcement retirement benefits totaling approximately
$750,000.00 he would not otherwise have received had
management exercised other more reasonable options.
Background on felonious activity by Mr. Hollingsworth
According to State Department law enforcement agents, Mr.
Hollingsworth's criminal activity in this case commenced on
or about September, 1992, when he reviewed the local
obituaries in Florida and obtained the name of Charles W.
Drew, who was born in 1944 and died in 1948. Mr.
Hollingsworth, with a Top Secret security clearance,
requested from the State of Florida a copy of the death
certificate, representing himself as the deceased's half-
brother. Mr. Hollingsworth leased a mailbox in Springfield,
Virginia under the alias of Charles and Maureen Drew and
Harold Turner.
Mr. Hollingsworth then obtained a birth certificate for
Charles Drew from the State of Georgia and had it sent to the
mailbox in Springfield, Virginia. Mr. Hollingsworth then
leased another mailbox under the alias of Charles and Mary
Drew in Arlington, Virginia. Mr. Holingsworth submitted an
application and received a social security card under the
alias Charles Drew Jr. by posing as the applicant's father.
Mr. Hollingsworth, accompanied by his spouse, applied for and
received a Virginia Department of Motor Vehicles
identification card in the name of Charles Drew. Using the
DMV identification card in the name of Charles Drew, Mr.
Hollingsworth applied for a U.S. Passport. It should be noted
that his wife, Mrs. Jaureen Hollingsworth, a DOD IG employee
at the time, was never implicated or charged in this
felonious activity. She was not a suspect in the
investigation by the U.S. State Department. Mr. Hollingsworth
stated to State Department law enforcement agents that he
procured approximately eight to ten false identify documents,
to include an international drivers license and a priest ID,
by means of mail order.
In April of 1995, U.S. State Department law enforcement
officials placed a photo of Mr. Hollingsworth in law
enforcement bulletins as an unidentified suspect in passport
fraud. the local Philadelphia office of DCIS notified DCIS
headquarters in Washington D.C. that a photo of Mr.
Hollingsworth was found in a bulletin. Officials at DCIS in
Washington D.C. notified Mr. Mancuso who is turn immediately
notified Inspector General Eleanor Hill. Mr. Mancuso was then
ordered by DOD IG Eleanor Hill to notify the State Department
Office of Inspector General.
[See Attachment #1--Sentencing memorandum date stamped 06/
04/96]
[See Attachment #2--State Department Investigative
Timeline]
Statements made by State Department law enforcement agent
On July 16, 1999, the Subcommittee Majority Staff
interviewed Sean O'Brien, Special Agent with the State
Department Diplomatic Security Service. Agent O'Brien was one
of the agents assigned to the Hollingsworth case. Agent
O'Brien stated that there were at least 12 overt acts of
fraud perpetrated by Mr. Hollingsworth over the course of
several years. Agent O'Brien felt that the actions of Mr.
Hollingsworth were disturbing in light of the fact that
passport fraud is usually committed in furtherance of a more
serious crime, and a credible motive had never been
established.
Mr. O'Brien added that family members of the deceased boy,
Charles Drew, whose identify was used by Mr. Hollingsworth,
were very upset and prepared to testify at trial. Agent
O'Brien also opined that various motions to dismiss the case
were delaying tactics used by Mr. Hollingsworth until he
reached his 50th birthday--when he could retire with law
enforcement benefits.
The State Department Supervisor of the Hollingsworth case,
Special Agent Robert Starnes, stated that DCIS management
initially refused to let him examine the contents of Mr.
Hollingsworth's government computer under the pretense that
Mr. Hollingsworth may have had personal and/or classified
material on a government computer. Despite possessing a Top
Secret security clearance, Agent Starnes had to raise the
possibility of a search warrant with DCIS management before
they acquiesced and allowed a consent search of the computer.
DCIS management assigned DCIS Agent Paul Tedesco as the
point of contact in this case for the State Department.
Relevant information regarding Mr. Hollingsworth's criminal
conduct was provided by State Department investigators
directly to DCIS Agent Tedesco during all criminal
proceedings. Agent Tedesco also provided certified court
documents to then Director of Operations and current Director
of DCIS John Keenan. These court documents described the
criminal conduct of Mr. Hollingsworth. Agent Tedesco stated
that DCIS management was kept fully informed of the criminal
conduct of Mr. Hollingsworth from the time of his confession
through sentencing.
In the experienced opinion of State Department Case Agent
Sean O'Brien, State Department Special Agent Case Supervisor
Starnes and DCIS Case Liaison Agent Paul Tedesco, this
fraudulent activity was most probably in furtherance of
another crime that was never discovered or proven.
[See Attachment #3--Subcommittee memorandum of 07/16/99
interview with agent O'Brien]
Chronology of judicial and personnel actions in the case of
Mr. Hollingsworth
07/28/95: Larry J. Hollingsworth's home is searched by U.S.
State Department law enforcement agents and he subsequently
confesses to fraudulently applying for a U.S. Passport. [See
Attachment #4--Time line provided by DOD 7/27/95-9/20/96]
01/27/96: Larry J. Hollingsworth is indicted in U.S.
District Court on two felony counts.
03/18/96: Larry J. Hollingsworth pleads guilty and is
convicted of a felony, 18 USC 1001.
06/4/96: Convicted felon Larry J. Hollingsworth is
sentenced to 30 days imprisonment on weekends, 2 years
probation, 200 hours community service and a $5,000.00 fine.
[See Attachment #5--U.S. District Court Criminal Docket]
08/12/96: Larry J. Hollingsworth is notified by DOD DCIS of
a ``Proposed Removal'' and given thirty days to respond. [See
Attachment #6--DOD OIG notice of Proposed Removal dated 08/
12/96]
09/19/96: Larry J. Hollingsworth retires on his 50th
birthday citing a reason of ``pursuing other interests''.
[See Attachment #7--DOD Notice of Personnel Action form 50-B
dated 09/19/94]
09/20/96: Larry J. Hollingsworth's attorney notifies then
DOD Assistant Inspector General Mancuso that he waives his
right to appeal the removal. [See Attachment #8--Letter from
Hollingsworth's attorney to Mr. Mancuso dated 09/20/96]
DOD General Counsel claims conditional plea prevented removal
of Mr. Hollingsworth
On September 14, 1999, Mr. Mancuso and the Deputy General
Counsel (Inspector General), Mr. Kevin Flanagan, stated to
the Subcommittee that the reason Mr. Hollingsworth was never
removed and allowed to retire, was that his guilty plea was
``conditional'' and that he could withdraw his plea at any
time at his own initiative.
The Federal Rules of Criminal Procedure Rule 11(A)(2)
states; ``with the approval of the court and the consent of
the government, a defendant may enter a conditional plea of
guilty or nolo contendere, reserving in writing the right, on
appeal from the judgment, a review of the adverse
determination of any specified pretrial motion. A defendant
who prevails on appeal shall be allowed to withdraw the
plea.''
The plea agreement in this case acknowledges a conditional
plea by Mr. Hollingsworth reserving ``his right to appeal the
Court's adverse March 8, 1996 ruling denying defendant's
motion to suppress his statement to State Department
Agents''. The plea agreement also states; ``the defendant
knowingly waives his right to appeal any sentence.''
Therefore, Mr. Hollingsworth never had unilateral authority
to withdraw his plea at anytime, as Mr. Mancuso and DOD
General Counsel argued. Their reason for not terminating Mr.
Hollingsworth after conviction appears to be invalid.
[See Attachment #20--Rules of Criminal Procedure 11(a)(1)]
[See Attachment #21 Plea Agreement dated 03/15/96 page 3]
Mr. Hollingsworth was never removed by DOD and as stated in
the chronology, remains a convicted felon despite the
numerous motions to dismiss. Federal Law, DOD IG regulations,
legal counsel at the DOD Washington Headquarters Services
(WHS) and OPM General Counsel stated that Mr. Hollingsworth
could have been removed based on his criminal misconduct
alone. The misconduct must be proved with a ``preponderance
of the evidence'' and not ``beyond a
[[Page S13645]]
reasonable doubt.'' Preponderance of the evidence is a much
lower threshold than a criminal court procedure wherein
criminal conduct must be proved ``beyond a reasonable
doubt.''
Federal law states Mr. Hollingsworth could be dismissed
within 7 days
5 U.S.C. 7513, (b), regarding removals of federal employees
states:
1. At least 30 days advance written notice, unless there is
reasonable cause to believe the employee has committed a
crime for which a sentence of imprisonment may be imposed,
stating the specific reasons for the proposed action.
2. A reasonable time, but not less than seven days, to
answer orally and in writing and to furnish affidavits and
other documentary evidence in support of the answer. [See
Attachment #9--5 United States Code 7513]
The DOD Time Line cites this law as reason for a 60 day
delay in issuing a 30 day ``proposed removal.'' Mr.
Hollingsworth had already served a considerable amount of
time in jail before the proposed removal was issued.
DOD Inspector General Regulations state Mr. Hollingsworth
could have been terminated after Indictment.
IGDR 1400.4, Displinary and Adverse Action dated December
30, 1994, page 7, states an immediate removal can be
initiated ``when the agency has reasonable cause to believe
that an employee has committed a crime for which a sentence
of imprisonment may be imposed. Reasonable cause to believe
is not established by the mere fact either of an arrest or an
ongoing agency investigation of possible criminal misconduct.
A criminal indictment will usually constitute reasonable
cause.''
[See Attachment #10--IGDR--dated 12/30/94, Page 7]
DOD WHS Legal Counsel advises Mr. Hollingsworth may be
terminated after his guilty plea
On March 14, 1996, Gilda Goldsmith, legal counsel at the
DOD WHS, advised that ``the indefinite suspension, which
suspends Mr. Hollingsworth from duty until final disposition
of criminal charges and any administrative proceedings, does
not bar the agency from terminating him based on his guilty
plea . . . the agency could remove Mr. Hollingworth for both
the guilty plea and underlying conduct, but would have to
prove the conduct by a preponderance of the evidence if the
conviction is reversed.''
[See Attachment #11--DOD WHS Legal Counsel memo dated 03/
14/96]
OPM General Counsel cites other options available to DCIS
management
The Subcommittee Majority Staff requested the assistance of
OPM in determining whether Mr. Hollingsworth, a convicted
felon, was entitled to a federal law enforcement retirement
six months after conviction and two months after serving his
senence of jail on weekends. He received retirement credit
and remained in an employed status as Director of Internal
Affairs durng the six months in question to include two
months of jail time on weekends.
On July 20, 1999, DOD Personnel Director Donna Seracino
stated that Mr. Hollingsworth could not be immediately
removed after his guilty plea and felony conviction because
``he had rights to due process under OPM guidelines''.
On September 13, 1999, OPM General Counsel Suzanne Seiden
stated in her legal opinion: ``Instead of seeking to remove
him because of the criminal conviction, it is possible that
DCIS appropriately could have charged him with, among other
things, an action under 5 U.S.C., 7513, on grounds of general
criminal misconduct or failure to maintain his security
clearance. Further, DCIS might have chosen to expedite his
removal following Mr. Hollingsworth's guilty plea''.
[See Attachment #12--OPM General Counsel opinion dated 09/
13/99]
Outstanding evaluation for Mr. Hollingsworth endorsed by
Director of DCIS Mancuso
On August 18, 1999, approximately three weeks after Mr.
Hollingsworth's home was searched and he confessed to at
least three years of felonious activity (07/27/95), Mr.
Mancuso signed and approved an ``outstanding'' performance
evaluation for Mr. Hollingsworth. Mr. Hollingsworth replied
on the evaluation form; ``I appreciate your comments on my
appraisal, especially in light of my recent actions.''
[See Attachment #13--Employee Performance rating signed by
Mr. Mancuso 08/18/95]
Mr. Mancuso places Mr. Hollingsworth on Paid Leave
On November 22, 1995, Mr. Mancuso decided to hold
indefinite suspension of Mr. Hollingsworth in abeyance and
advised ``Mr. Hollingsworth he would be carried on sick leave
for any period of time that was supported by acceptable
medical documentation, carried on annual leave as long as he
had an annual leave balance and requested such leave, and
that the indefinite suspension would become effective when
his annual leave was exhausted and he no longer met the
requirements for sick leave.''
[See Attachment #4--Time line provided by DOD 7/27/95-9/20/
96]
Mr. Mancuso advises Mr. Hollingsworth to meet with a
physician
On November 22, 1995, ``Mr. Mancuso advises Mr.
Hollingsworth to schedule an appointment with the Independent
Medical Evaluation (IME) physician. The agency would approve
sick leave through November 30, 1995, and any request for
additional sick leave would be held in abeyance pending
receipt and review of the additional medical documentation.''
[See Attachment #4--Time line provided by DOD 7/27/95-9/20/
96]
Assistant United States Attorney opposes use of physician as
Defense Witness
On March 8, 1996, Assistant United States Attorney Thomas
G. Connolly for the Eastern District of Virginia stated in
his legal brief to the U.S. District Court in regards to the
testimony of the IME physician for the defense:
``This testimony is not relevant to a determination of any
issue to be tried in this case. It is a patent attempt at
jury nulifcation by presenting evidence in the hope of making
the defendant sympathetic to the jury. It is a backdoor
attempt to raise issues of mental condition prohibited by
law; and it is prejudicial, confusing, and misleading. This
court should exclude any proposed psychiatric testimony from
evidence at trial.''
[See Attachment #14--Government's motion to exclude
psychiatric testimony page 2]
Mr. Seldon, Attorney for Mr. Hollingsworth, contacts DOD
Employee Relations concerning retirement
On February 7, 1996, the defense attorney for Mr.
Hollingsworth contacts DOD Employee Relations Specialist
Linda Martz. She states the attorney said ``he wanted to
ensure that his client was technically on the agency rolls. I
said yes. Mr. Seldon said the U.S. Attorney wanted his client
to plead guilty to one felony count. He said he understood
that if the criminal matter ended and Mr. Hollingsworth was
convicted, removal was probable. He asked if that was
correct. I said most likely. He said his client's hope was to
stay on the agency rolls until September 1996 at which time
he would retire. I said he could retire now, but not under
law enforcement. Mr. Seldon said he understood that, but
there would be a substantial reduction.''
[See Attachment #15--Memorandum for the record of Linda
Martz dated 02/07/96]
Defendant Hollingsworth makes motion to dismiss case
On March 12, 1996, Mr. Hollingsworth's defense attorney
made a motion in U.S. District Court to dismiss the charges,
citing Mr. Mancuso's request for medical information. He said
Mr. Mancuso had ``directed him to provide sufficient medical
information which will be reviewed by the medical consultant
for the Office of Inspector General, to assist him in making
a decision on the proposed suspension.''
[See Attachment #16--Motion to dismiss indictment page 3
section 7]
Assistant United States Attorney comments on sick leave
status and use of a physician
On March 12, 1996, Assistant United States Attorney Thomas
G. Connolly for the Eastern District of Virginia stated in
his legal brief to U.S. District Court:
``The defendant's motion to dismiss the indictment is not
only untimely, it is frivolous . . . The government (in the
form of the United States Attorneys Office) was not party to
any negotiations concerning the defendants sick leave. In
fact, the first time we head about this was on March 7, 1996,
when defense counsel faxed us a letter detailing Dr.
Holland's findings.''
``The United States Attorneys Office had no opportunity,
whatsoever to be heard in the negotiations between Mr.
Hollingsworth's lawyers and the Department of Defense
concerning whether Mr. Hollingsworth should be granted sick
leave because he was allegedly suffering from depression a
year-and-a-half after he had committed the crimes and 4
months after he had been caught.''
[See Attachment #17--Opposition to Defendant's Motion to
Dismiss page 3]
Attorney for Mr. Hollingsworth contacts DOD Employee
Relations one day after motion to dismiss and complements
Mr. Mancuso for assistance.
On March 13, 1996, Linda Martz, DOD Employee Relations
Specialists took a call from Mr. Seldon, attorney for Mr.
Hollingsworth. She stated; ``Mr. Seldon wanted to know what
Larry's sick and annual leave balances were. . . . I went on
to explain that when he was indicted the situation took on
another look. He said he understood and believed Mr. Mancuso
did what he could be help Mr. Hollingsworth''.
[See Attachment #18--Linda Martz memo dated 03/13/96]
Mr. Mancuso acknowledges Mr. Hollingsworth's criminal conduct
was perpetrated in furtherance of another unknown crime
On September 14, 1999, during a Subcommittee Majority Staff
interview regarding the criminal misconduct of Mr.
Hollingsworth, Mr. Mancuso stated he now believes that
logically, the criminal misconduct of Mr. Hollingsworth
appeared to be in furtherance of another crime.
Mr. Mancuso writes letter to sentencing judge on behalf of
Mr. Hollingsworth
Mr. Mancuso wrote a letter dated April 29, 1996, to
sentencing Judge Ellis on official DOD Assistant Inspector
General stationary. Mr. Mancuso wrote this letter ``on behalf
of Mr. Hollingsworth . . . one of the few individuals in whom
I placed complete confidence and trust.'' In writing the
letter, Mr. Mancuso asked the judge to consider extenuating
circumstances. For example, he told
[[Page S13646]]
the judge that Mr. Hollingsworth took a half day's leave to
file the fraudulent passport application. Mr. Mancuso said he
was not surprised by this action. He said: ``Mr.
Hollingsworth could have come and gone as he pleased,'' but
he ``took leave to commit a felony.'' Mr. Mancuso went on to
say: ``To this day, there is no evidence that Mr.
Hollingsworth has ever done anything improper relating to his
duties and responsibilities as a DCIS agent and manager.''
In concluding the letter, Mr. Mancuso added: ``I do ask,
however, that you consider all these things as well as his
stated remorse and acceptance of responsibility for his
actions . . . it is our intention to consider removal action
against him after the conclusion of the criminal charges. In
this regard, I would ask that you consider the severity of
these administrative actions as you pronounce sentencing.''
The letter was signed; ``Sincerely, Donald Mancuso,
Director, Defense Criminal Investigative Service''.
[See Attachment #19--Letter from Mr. Mancuso to Judge Ellis
dated 04/29/96]
Mr. Mancuso comments on letter to Judge Ellis
In a Majority Staff interview on September 14, 1999, Mr.
Mancuso claimed that the stationary used in the letter to
Judge Ellis was ``personal, bought with my own money'' and
not official DOD Inspector General stationary. It was pointed
out to Mr. Mancuso that the letterhead had a government seal
which contained the words; ``Inspector General--Department of
Defense.'' In addition, Mr. Mancuso signed the letter in his
official capacity as an Assistant Inspector General. The
letter was made a part of the sentencing report by Judge
Ellis.
[See Attachment #19--Letter from Mr. Mancuso to Judge Ellis
dated 04/29/96]
[See Attachment #1--Sentencing memorandum date stamped 06/
04/96]
Assistant United States Attorney comments on lack of remorse
by Mr. Hollingsworth
On March 12, 1996, Assistant United States Attorney Thomas
G. Connolly for the Eastern District of Virginia stated in
his legal brief to U.S. District Court:
``The defendant's appreciation of the wrongfulness of his
conduct in April of 1994 has never been determined in any
hearing at which the United States Attorneys Office (or any
other government agency, including the Department of Defense)
was a party.''
[See Attachment #17--Opposition to Defendant's Motion to
Dismiss page 3]
Assistant United States Attorney comments on Mr.
Hollingsworth's mental state
``Mr. Hollingsworth's condition, whatever it is, is not
found in DSM IV, the 886-page tome that lists every
psychosis, neurosis, syndrome, and personality disorder known
to man.''
[See Attachment #14--Government's motion to exclude
psychiatric testimony page 5]
Mr. Dupree, former Deputy Director of DCIS, stated Mr.
Hollingsworth was considered a cooperative defendant by
DCIS management
On August 24, 1999, Mr. Dupree, a former Deputy Director of
DCIS, and under the direct supervision of Mr. Mancuso, was
interviewed by the Majority Staff. Mr. Dupree reviewed
proposals to remove DCIS employees for misconduct based on
internal investigations. He characterized Mr. Hollingsworth
as a ``cooperative defendant''. Mr. Dupree stated that it
would have been easier to remove Mr. Hollingsworth if he had
misused a government vehicle.
9/13/96--Mr. Hollingsworth requests extension on proposal
removal
On August 23, 1996, Mr. Hollingsworth asks Mr. Mancuso for
an extension of his proposed removal pending an oral reply to
be made on 09/13/96.
[See Attachment #4 Time line provided by DOD 7/27/95-9/20/
96]
Mr. Mancuso grants requested extension and schedules oral
response for 09/23/96, four days after Mr.
Hollingsworth's 50th Birthday
On August 26, 1996, Mr. Mancuso grants the extension
request and schedules the oral reply for September 23, 1996,
the first available date because Mr. Mancuso claimed that he
would ``be on travel much of September and will not be
available to hear Mr. Hollingsworth's oral response'' until
that date.
A review of Mr. Mancuso's travel vouchers suggests that the
projected travel conflicts--outlined in his August 26, 1996
memo--never materialized and that he would have been
available to hear the case at any point during the month of
September--with several minor exceptions. During an interview
on September 14, 1999, Mr. Mancuso was asked if he was aware
of Mr. Hollingsworth's birthday when he signed the August 26,
1996 memo. Initially, he denied having that knowledge, but
with coaching from Deputy DOD General Counsel Flanagan, he
admitted that he did, in fact, know that Mr. Hollingsworth's
50th birthday was in September 1996.
[See Attachment #4 Time line provided by DOD 7/27/95-9/20/
96]
Convicted Felon Mr. Hollingsworth retires with full federal
law enforcement retirement benefits totaling over
$750,000.00
On September 19, 1996, Mr. Hollingsworth retired on his
50th birthday and first date of eligibility for federal law
enforcement retirement, citing his desire ``to pursue other
interests.'' Mr. Hollingsworth currently receives full
federal law enforcement retirement benefits.
[See Attachment #7 notice of personnel action]
According to OPM, if Mr. Hollingsworth had been removed
immediately after his felony conviction, he would have been
entitled to an annuity commencing at age 62. Since Mr.
Hollingsworth was not removed by DOD after his conviction and
was allowed to retire six months after his conviction at age
50, Mr. Hollingsworth immediately began receiving a federal
law enforcement yearly annuity of over $60,000. Not including
cost of living adjustments, these annuities will total over
750,000.00 for 1996-2008--annuities he would not have
received had DCIS management exercised other more reasonable
options.
On September 20, 1996, Mr. Hollingsworth's attorney
``waives his right to any further proceedings in connection
with the proposed removal due to his retirement.''
[See Attachment #8--Letter from Hollingsworth Attorney
dated 09/20/96]
Mr. Mancuso characterizes State Department Investigators as
``Horse's Asses''
On September 14, 1999 the Majority Staff interviewed Mr.
Mancuso to review his role in Mr. Hollingsworth's retirement.
Mr. Mancuso claimed that State Department investigators did
not brief DCIS on the details of the criminal case against
Mr. Hollingsworth until after sentencing. The State
Department's failure to share this information in a timely
manner was another reason for delay in removal action against
Mr. Hollingsworth. Mr. Mancuso characterized State Department
investigators in this case as ``Horses' Asses.''
DCIS Agent Tedesco keeps DCIS management informed and
complements performance of State Department investigators
in the Hollingsworth case
As stated previously, DCIS Agent Tedesco provided all
relevant certified court documents to DCIS Director of
Operations John Keennan throughout the judicial proceedings
against Mr. Hollingsworth. These documents were passed to
senior DCIS management as they became available. These
documents fully described the criminal conduct for which Mr.
Hollingsworth was being prosecuted. Agent Tedesco described
his relationship with State Department investigators as
``excellent,'' resulting in a timely, accurate, and
professional flow of information between the two law
enforcement agencies. Agent Tedesco refutes any assertion
that DCIS management was not informed during any part of the
judicial process.
DOD Inspector General Eleanor Hill orders Mr. Hollingsworth
to be removed ``as soon as legally possible''
Eleanor Hill was the DOD Inspector General during the
Hollingsworth criminal procedures. On September 21, 1999,
Eleanor Hill stated to the Subcommittee Majority Staff that
shortly after Mr. Hollingsworth confessed, she had ordered IG
personnel, including Mr. Mancuso, ``to remove Hollingsworth
as soon as legally possible.''
DOD Inspector General Eleanor Hill was unaware of several
decisions by Mr. Mancuso regarding Mr. Hollingsworth
Ms. Hill stated she was unaware that DCIS management
initially refused to allow State Department investigators a
consent search of Mr. Hollingsworth's government computer.
Ms. Hill stated she was unaware that Mr. Mancuso endorsed
an outstanding evaluation of Mr. Hollingsworth after his
confession to criminal conduct.
Ms. Hill stated she was unaware that Mr. Mancuso wrote a
letter as an Assistant Inspector General on official
stationary to the sentencing judge on Mr. Hollingsworth's
behalf.
Hollingsworth Case--Attachments
1. Sentencing Memorandum filed in U.S. District Court,
dated 06/04/96
2. State Department Investigative Time line
3. Subcommittee interview of State Department Special Agent
O'Brien
4. Timeline provided by DOD 7/27/95-9/20/96
5. U.S. District Court Criminal Docket
6. DCIS Proposal for Removal
7. Notice of Personnel Action
8. Letter from Mr. Hollingsworth's attorney waiving right
to appeal removal
9. Copy of 5 U.S.C. 7513
10. DOD IG Regulations on Disciplinary and Adverse Action
Page 7
11. DOD General Counsel memo dated 3/14/96
12. OPM response to subcommittee request
13. Evaluation of Mr. Hollingsworth dated 08/18/95.
14. Government's motion to exclude Defendant's Proposed
Psychiatric Testimony
15. Memorandum of Linda Martz dated 02/07/96
16. Motion to Dismiss Indictment
17. Opposition to Defendant's Motion to dismiss
18. Memorandum of Linda Martz dated 03/13/96
19. Letter to Judge Ellis written by Mr. Mancuso on behalf
of Mr. Hollingsworth dated 04/29/96
20. Rules of Criminal Procedure 11(a)(1)
21. Plea Agreement dated 03/15/96
walinski: criminal investigator, dcis internal affairs
Mr. Matthew A. Walinski worked at the Defense Criminal
Investigative Service (DCIS) as a criminal investigator (GS-
1811) from August 1987 through 1998. Since January 1999, he
has been employed as a criminal investigator (special agent)
in the Office of
[[Page S13647]]
the Inspector General at the Department of the Treasury. His
assigned duties at the Treasury Department include
investigating employee misconduct and fraud. Although
Walinski was promoted to the grade of GS-14 at DCIS in August
1991, he accepted a reduction in grade to GS-13 at the
Treasury Department. He told the Subcommittee on September 8,
1999 that he left DCIS because he was informed by the DCIS
Director Keenan that his goal of becoming a manager was
unattainable.
DCIS Internal Affairs
In June 1999, the Subcommittee received a complaint from a
former DCIS agent that Walinski had falsified official
reports of investigation while employed at DCIS. The
complaints about the falsification of reports by Walinski
relate to investigations he conducted while assigned to DCIS'
Program Review and Analysis Directorate. This office is known
informally as ``internal affairs.'' Walinski was assigned to
internal affairs from August 1991 until July 1994.
Throughout Walinski's tour of duty in the office of
internal affairs, the unit was headed by Mr. Larry J.
Hollingsworth. As Director of internal affairs, Hollingsworth
held a key position in DCIS's organizational structure--along
with the Director (Mancuso), Deputy Director (Dupree), and
the Director of Operations (Keenan). Though important
internal affairs was a small office. It normally consisted of
three investigators (Hollingsworth, Bonnar, and Walinski).
However, the office could be augmented--as needed--with
special agents from the field.
Hollingsworth directed the DCIS office of internal affairs
from April 1991 until his retirement in September 1996,
according to a document provided by the IG's office. That
Hollingsworth was technically listed as the director of
internal affairs until his retirement in September 1996
defies understanding, since Hollingsworth was convicted of a
felony (18 USC 1001) in March 1996 and sentenced to 30 days
in jail on the weekends in June 1996.
The authorities, who conducted the investigation (Bureau of
Diplomatic Security) of Hollingsworth's criminal activities,
believe Hollingsworth committed about 12 overt acts of fraud
between October 1992 and April 1994. The 12 alleged overt
acts of fraud committed by Hollingsworth were perpetrated
while he was the director of DCIS' office of internal
affairs. Hollingsworth's criminal conduct while director of
internal affairs must inevitably raise questions about the
overall integrity of the work performed by this office while
Hollingsworth was director.
Mr. Thomas J. Bonnar was the Assistant Director of Program
Review. Bonnar was Mr. Walinski's immediate supervisor.
While Hollingsworth was in charge of the day-to-day
operations of the office of internal review, the DCIS
Director, Mr. Donald Mancuso, exercised overall management
control of all internal investigations. As DCIS Director,
Mancuso was the person chiefly responsible for the conduct of
internal inquiries. His position description (DDES0466)
states under ``Major Duties,'' paragraph (1): Mancuso
``provides staffing and direction for the conduct of internal
investigations, as needed.'' Once allegations were received
about potential misconduct by DCIS agents, Mancuso and the
Deputy DCIS Director, Mr. William Dupree, would usually
decide if an inquiry would be conducted, and what its scope
would be. As a rule, those decisions were reached in
consultation with Hollingsworth.
Mancuso and Dupree would normally receive periodic
briefings or status reports on each internal investigation
still in progress. If a problem arose during an inquiry,
Mancuso and Dupree would know about it. When Walinski
completed his report of investigation, it would usually be
forwarded up the chain of command by Hollingsworth to an
Administrative Review Board (ARB). The ARB then made
recommendations. Either Mancuso or Dupree would review those
recommendations and make the final decision on what--if any--
disciplinary action was needed.
While assigned to DCIS' office of internal review, Walinski
was tasked to complete about 30 ``administrative inquiries''
concerning allegations of misconduct by DCIS agents. The
complaints about the falsification of his reports pertain to
two ``administrative inquiries'' conducted by Walinski in
1993 and 1994 as follows: (1) the tax fraud case involving
Special Agent (SA) William G. Steakley--Administrative
Inquiry 91; and (2) Stolen gun case involving Special Agent
(SA) Stephen J. Johanson--Administrative Inquiry 108.
The purpose of this portion of our review was to assess the
validity of the allegations against Walinski and to search
for the answers to three questions: (1) Did Walinski falsify
his reports on the Steakley and Johanson cases? (2) If
Walinski falsified reports, did senior management at DCIS
know about it? And (3) If DCIS management knew about it, did
management take appropriate corrective action?
To answer the three questions, the Majority Staff examined
all pertinent General Counsel, IG, and U.S. Office of Special
Counsel (OSC) files, including reports of investigations and
E-mails. The staff also conducted a number of separate
interviews.
The Case of Mr. Steakley
On May 11, 1993, Walinski opened the tax evasion case
against Steakley. This was Administrative Inquiry 91. It was
opened ``based on information that SA Steakley made
misleading statements to the DCIS payroll support activity
regarding his actual place of residence in an apparent effort
to circumvent his state income tax obligations.''
[See Attachment 1--page 1 of Report of Investigation (ROI)]
The foundation for Walinski's ROI on the Steakley tax fraud
case was his interview with a payroll specialist at Bolling
AFB, Washington, D.C.--Mrs. Nancy Gianino. At the time,
Gianino was responsible for handling all DCIS payroll
matters. Walinski's official witness interview report, dated
June 1, 1993, states that Gianino was interviewed at Bolling
AFB on May 21, 1993 ``concerning her knowledge of the payroll
deductions of SA Steakley.''
Gianino Interview
Since the Gianino interview is such a crucial piece of
evidence in evaluating the accuracy of Walinski's reports, it
is quoted here in its entirety:
``Mrs. Gianino said that sometime in late November 1991 she
received a letter from SA Steakley which instructed her to
discontinue payroll withholding on SA Steakley's salary by
the Commonwealth of Virginia. After receiving the letter,
which is appended as attachment 1, she contacted SA Steakley
via telephone and he informed her that he was being
transferred and had, in conjunction with his transfer,
established residency in the State of Tennessee. At the time
she thought it was strange that an employee who lived and
worked in Virginia could move his residency to another state,
but because SA Steakley told her he was being transferred in
December 1991 she was not concerned. On December 11, 1991,
Mrs. Gianino changed SA Steakley's state tax code from
Virginia to Tennessee. Mrs. Gianino stated that very shortly
after her discussions with SA Steakley she became very ill
and was off work for an extended period of time. Because of
her illness she was unable to follow-up concerning SA
Steakley and his move as would be her normal practice.
Normally, Mrs. Gianino makes sure that state income taxes are
withheld from the state where the individual's duty
assignment is located, especially a state as strict as
California.
In the Spring of 1993, after her return from the extended
illness, Mrs. Gianino started to reconcile the payroll
records for the Defense Criminal Investigative Service.
During this reconciliation she reviewed and compared the
permanent duty station location for each employee from their
Notification of Personnel Action Standard Form 50; the state
code of each employee utilized by the Air Force for
deductions for state income taxes; and the current mailing
address for each employee. She then discovered that SA
Steakley was permanently assigned to California, had a state
tax code for Tennessee, and a mailing address in Virginia.
Mrs. Gianino stated that she brought this discrepancy to the
attention of DCIS management as the Air Force considers this
situation to be unacceptable under applicable payroll
guidelines.
Mrs. Gianino said that in retrospect she felt that both SA
Steakley's letter and the subsequent telephone call were
vague and very misleading.''
[See Amendment 1, Witness Interview/Gianino]
DCIS Contacts State Tax Authorities
Based on the information provided by Gianino, DCIS
officials, including Walinski and Hollingsworth, contacted
the departments of taxation in the states of California and
Virginia to determine whether Steakley had unpaid income tax
liabilities in either state. In addition, they contacted the
State of Tennessee to determine whether Steakley was a
resident of that state.
DCIS made repeated attempts to obtain information on
Steakley's tax obligations in California and Virginia.
Letters were sent to the tax authorities in both states on
July 27, 1993, July 30, 1993 and December 2, 1993. The
letters were followed up by telephone calls.
Access To Tax Records Blocked
In a memo dated December 23, 1993, Walinski reported that
he was unable to obtain any information from Virginia on
Steakley's tax liabilities. Walinski reported:
On December 22, 1993, an official in Virginia's Department
of Taxation informed DCIS: The Commonwealth of Virginia will
not acknowledge or provide documentation to generic tax
liability issues unless the writer of the correspondence is
the Commonwealth of Virginia taxpayer . . . . . Per
Commonwealth of Virginia Statute the information in question
could not be released to DCIS because DCIS was not the
taxpayer in question.''
[See Amendment 1, Contact Report with Department of
Taxation, Commonwealth of Virginia]
In an E-mail message to his supervisor, Bonnar, on July 8,
1994, Walinski reported that identical restrictions applied
to access on individual tax liability data in California.
Walinski reported:
On May 5, 1994, California tax authorities informed DCIS:
By law, California can not release any information concerning
an individual taxpayer without a court order or a release
from the individual in question.''
[See Attachment 1, Contact Report with California Franchise
Tax Board]
DCIS Continues to Pursue Tax Data
Even though DCIS was prohibited by state law from obtaining
information on Steakley's state tax liabilities, DCIS
Director Mancuso and Hollingsworth pressed
[[Page S13648]]
Walinski to find a way to obtain that information.
During an interview on August 24, 1999, Hollingsworth
reacted strongly to the suggestion that DCIS lacks authority
to obtain information on Steakley's unpaid state tax
liabilities. He insisted that DCIS had all the authority it
needed to get the job done. He said: ``I could have done that
investigation.'' Both Mancuso and Hollingsworth were formerly
employed criminal investigators at the Internal Revenue
Service.
Mancuso's E-mail to Hollingsworth on July 7, 1994
demonstrates something more than a passing interest in the
Steakley tax evasion case. Mancuso's message conveys a sense
of urgency on the need to obtain Steakley's state tax data.
It also seems to suggest that DOD legal counsel may have
advised DCIS not to pursue tax fraud charges against
Steakley. Mancuso made this request:
``Please copy me on all transmittals between our office and
the states of California and Virginia relative to Mr.
Steakley's taxes. It has been a ridiculous amount of time
since you told me that we were waiting to hear back from
them. At the time of our last discussion I directed you to
document your contacts so that I could refer to them if some
quick action did not ensue. I've spoken to OGC [Office of the
General Counsel] and I think I can get their support despite
Perkul [Deputy General Counsel, Washington Headquarters
Services] and crew.''
``I'd also like to start making phone calls to the two
states and finding out what they're doing with our
information.''
[See Attachment 1, E-mail from Mancuso to Bonnar and
Hollingsworth]
When asked by an independent DOD investigator, Mr. Greg
McClelland, why DCIS would pursue tax charges against
Steakley when prohibited by state law from obtaining that
information, Mancuso replied: ``We'll pursue anything that
goes to the integrity of the agent.''
[See Attachment 2, Greg McClelland interview, March 13,
1997, p. 35]
Mancuso's reply to McClelland's question in March 1997
suggests that he may have known that DCIS lacked authority to
gain access to Steakley state tax records. During an
interview on September 14, 1999, Mancuso provided a
completely different answer to essentially the same question.
He was asked why DCIS would pursue charges against Steakley
in an area--individual state tax obligations--where it had no
authority or jurisdiction to operate. He claimed ignorance.
He replied: ``I did not know that DCIS was not authorized
access to individual state income tax data.''
Walinski Complains about Pressure on Tax Data
One day after Mancuso's E-mail to Hollingsworth--July 8,
1994, Walinski complained about the pressure from Mancuso to
his supervisor, Bonnar. In this E-mail, Walinski stated:
``I do not understand what he [Mancuso] wants us to do. . .
. Without a release from Steakley, which both he and his
attorney(s) stated will not be provided or a court order of
some kind there is nothing else that I can do. I am sorry!''
[See Attachment 1, Walinski E-Mail to Bonnar]
Steakley's Tax Attorney Responds
DCIS attempted to interview SA Steakley's tax accountant/
lawyer, Mr. John T. Ambrose, but Steakley refused to waive
attorney-client privilege, and Mr. Ambrose refused to be
interviewed. However, after further discussion, Steakley's
tax attorney provided DCIS with a letter addressing various
tax issues bearing on the potential charges against his
client. The letter was dated February 22, 1994 and hand
delivered to Dupree. Mr. Ambrose stated:
``For tax year 1992, based on a determination that Mr.
Steakley was a resident of Tennessee, I prepared three (3)
state income tax returns for the Steakleys, one resident
state income tax return for Virginia and two (2) nonresident
state income tax returns for Virginia and California. In
determining how to complete those returns, I reviewed the tax
instructions published by the respective state tax agencies
and consulted with personnel at those agencies.''
[See Attachment 3]
Tennessee Residency
A DCIS records check in Tennessee did show that SA Steakley
owned two homes in the state; was registered to vote there
and, in fact, voted in the November 1992 general elections;
and applied for and received a state driver's license. Mr.
Walinski's report of investigation contains the general
guidelines in Tennessee tax law that are used as the standard
for determining whether a person can claim they are a
resident of the state. According to the information contained
in Walinski's report, Steakley appears to meet most of the
state residency requirements.
No Proof of Tax Fraud
At the conclusion of Walinski's investigation, DCIS had no
credible evidence or proof that Steakley had unpaid tax
liabilities in either California or Virginia.
In our interview on September 8, 1999, Walinski
acknowledged that his report of investigation on the tax
evasion case against Steakley was inconclusive and
unsubstantiated.
Walinski characterized the tax fraud case against Steakley
as ``an unresolved case.'' The investigation had serious
shortcomings: ``We couldn't nail him,'' Walinski said.
Walinski's inconclusive findings are not apparent in his
report. In fact, the report suggests DCIS had an airtight
case against Steakley. Walinski also claims Mancuso and
Dupree were aware of the flaw. Despite these known
deficiencies, Walinski said that he was ``not surprised''
to learn that the ARB Board had subsequently recommended
that Steakley ``be removed from his position at DCIS'' for
failing to meet his state tax obligations--a
recommendation based on Walinski's incomplete report.
``That's just the way DCIS did things,'' he said.
In our interview on September 14, 1999, Mancuso
contradicted Walinski's assertion that management knew the
tax case against Steakley was weak. Mancuso insisted that he
was not aware of the lack of credible evidence to support tax
evasion charges that were eventually brought against
Steakley. He said: ``I didn't know about that.''
Decisions on Tax Investigation Questioned
The staff does not understand why Mancuso and Dupree
decided to pursue the tax evasion charges given the
prohibitions in place that effectively blocked access to
Steakley's state tax records. If DCIS believed that this
matter needed further investigation, it should have referred
the matter to an external organization that had the authority
and jurisdiction to examine those records and determine if
Steakley had unpaid tax liabilities. In the absence of that
information, the tax evasion charge would be unjustified.
ARB Board Recommends Removal
The DCIS ARB met on February 7, 1994 to consider the
Steakley tax evasion case.
In a memo dated March 7, 1994, the ARB recommended that SA
Steakley ``be removed from his position with DCIS for
violating Executive Order 12674.'' The Board concluded that
``SA Steakley has a tax liability to the State of California
and he took overt steps to avoid paying this tax from
December 1991 through February 1993.'' The Board's report was
signed by James J. Hagen, Special Agent in Charge.
[See Attachment 4, page 2]
Tax Fraud Charges
On August 4, 1994, after reviewing the ARB's
recommendations, DCIS management issued Steakley a ``Notice
of Proposed Suspension.'' The notice was signed by Mr. John
F. Keenan, Director of Investigative Operations. Mr. Keenan
was also previously employed by the Internal Revenue Service
as a special agent. He is the Director of DCIS today.
Mr. Keenan rejected the ARB's recommendation to remove
Steakley. Instead, he proposed that SA Steakley be
``suspended without pay for fourteen (14) calendar days.''
The proposed suspension was based on: (1) SA Steakley's
failure to pay income taxes in the states of California and
Virginia; and (2) SA Steakley's failure to comply with
Executive Order 12730 [Section 101, paragraph (1)] that
requires employees to pay federal, state, and local taxes--
``that are imposed by law.''
[See Attachment 5, page 1]
In presenting their case against Steakley, both Mr. Keenan
and the ARB relied heavily on Walinski's reported interview
of Gianino. Key portions of that interview were incorporated
in both memos. For example, after reviewing the
communications between Steakley and Gianino in 1991 about
payroll deductions--as summarized in Walinski's report,
Keenan's memo cites her alleged reconciliation of DCIS
payroll records as the event that triggered the whole
investigation:
``In the spring of 1993, during a reconciliation of payroll
records for DCIS, it was discovered that you were permanently
assigned to California, had a state tax code for Tennessee,
and a mailing address in Virginia. This discrepancy was
brought to the attention of DCIS management as the Air Force
considers this situation to be unacceptable under applicable
payroll guidelines.
[See Attachment 5, page 2]
Adjudication--Charges Dropped
On October 25, 1994, Mancuso's deputy, Dupree, informed
Steakley that the tax fraud charges against him would be
dropped.
In a memo addressed to Steakley, Mr. Dupree attempted to
provide an explanation for his decision to drop the charges:
``I have considered the written response submitted by your
representative, Mr. Luciano Cerasi, as well as the oral
response presented by you and Mr. Cerasi on October 20, 1994.
Based on the information you provided concerning the filing
date of October 15 for the state of California, I have
decided that the charges are not substantiated. Therefore, it
is my decision to overturn the proposal to suspend you for 14
days.''
[See Attachment 6]
Dupree's explanation seems to suggest that the charges were
dropped because the California's state tax filing deadline
had not yet arrived. His explanation is difficult to
comprehend. Senior DCIS officials had consistently claimed
that Steakley's misconduct was ``an integrity issue.'' For
example, in his memo dated August 4, 1994, Keenan told
Steakley:
``I find you have violated the trust placed in you as a
employee of the OIG [Office of the Inspector General].''
[See Attachment 5, page 3]
It very difficult to reconcile Dupree's explanation for
dropping the charges with the questions raised about
Steakley's integrity--particularly since Dupree's memo was
signed ten days after the California filing deadline had
passed.
[[Page S13649]]
FLEOA's Allegations Against Walinski
During the adjudication process on tax fraud charges,
Steakley was represented by an attorney with the Federal Law
Enforcement Officers Association (FLEOA), Mr. Luciano A.
Cerasi.
As Steakley's defense counsel, Cerasi directed a 10-page
letter to Dupree in response to the proposed notice of
suspension issued to Steakley in August 1994. Cerasi's letter
was hand-delivered to Dupree on September 15, 1994. Cerasi
argued that ``the proposed adverse action against SA Steakley
must be rescinded due to a lack of preponderant evidence to
support the charges.''
In offering a spirited defense of his client, Cerasi, who
represents rank and file agents, also raised explosive
allegations about the accuracy of the investigative report
underlying the tax evasion charges. He alleged that
Walinski's report contained ``false, misleading, and
fabricated investigative material.''
Cerasi alleged that Walinski had ``fabricated the interview
in another [Johanson] case.'' He alleged that Walinski
``completely fabricated the results of his interview with
Mrs. Nancy Gianino.'' He referred to Walinski as
``management's pit bull.'' He said Walinski was ``willing to
fabricate investigative information to destroy the career of
a subject of an investigation.'' Cerasi urged Dupree to re-
open the case and re-investigate the entire matter.
[See Attachment 7, pages 2 and 3]
Cerasi's allegations about Walinski's report on the
Steakley case in September 1994 followed allegations and
complaints, which surfaced two months earlier, about
Walinski's report on the Johanson stolen gun case. The
Johanson case is discussed in the next section of this
report.
Steakley's Request for Re-Investigation
On October 20, 1994, both Cerasi and Steakley were given an
opportunity to present an oral response to the tax evasion
charges. During the oral rebuttal session in Dupree's office,
Steakley followed up on Cerasi's written request for a
``reinvestigation of this whole Walinski file.'' Steakley
requested ``an internal investigation of SA Walinski's
actions.'' Steakley stated once again ``he had proof that SA
Walinski had fabricated the results of the administrative
inquiry involving his state income taxes.''
[See Attachments 8, page 1]
Steakley's ``Proof''
The ``proof'' referred to by Steakley was a taped telephone
conversation he had with Gianino on September 8, 1994 about
Walinski's reported interview of her on May 21, 1993. This
tape was subsequently provided to and transcribed by the DOD
IG, and a copy of the transcription is located in the files
of the U.S. Office of Special Counsel (OSC).
The Majority Staff reviewed the tape transcription in the
OSC files.
Gianino's statements on this tape appear to indicate that
Walinski fabricated the entire Gianino interview. Steakley
read her Walinski's report of interview. She said that every
statement in Walinski's report, which was attributed to her,
was ``not true.'' She never had an extended illness, and her
leave records would prove it. She said Walinski made several
visits to her office to examine Steakley's file. She gave him
the file, and he took notes from the file. [Walinski probably
made these visits in March or April 1993 when checking
Steakley's time and attendance records during the
investigation of Steakley's accident with a government
vehicle in Administrative Inquiry 86]. At the conclusion of
the tape, Gianino said: ``Walinski came over here with his
badge and puts false accusations in his report. How am I ever
going to trust anybody coming over here [from that office]
again.''
[See Attachment 2, Telephone Conversation between William
G. Steakley and Nancy Gianino, September 8, 1994--Tape
Transcription, page 78]
DCIS Rejects Request for Re-Investigation
Except for what appears to be an exchange of perfunctory
phone calls in 1995, requests for an independent review of
Walinski's report were largely ignored--and finally
dismissed--by senior DCIS management. Another three years
would pass before Steakley's allegations about Walinski would
be subjected to an independent review.
IG Request for Independent Review
The independent review was triggered by a series of letters
from Steakley to Ms. Eleanor Hill, DOD IG, and to Senator
Fred Thompson. These letters were dated February 9, 1996 and
March 12, 1996. In these letters, Steakley renewed his
allegations that ``Walinski and Hollingsworth had ``prepared
fabricated reports.'' They had ``falsely accused him of tax
fraud,'' he alleged. These letters also put a new twist on
the allegations. Steakley now alleged that ``Walinski stated
directly that the entire matter was directed by Mancuso and
Dupree.''
[See Attachment 9, Steakley letters to Hill and Sen.
Thompson multiple pages]
DOD IG Refers Case to PCIE
Since Steakley's allegations were ``long-standing in nature
and involve a number of individuals in various parts of the
IG organization,'' Hill concluded that her office was not
capable of conducting ``an objective internal investigation
of the allegations.'' She said it simply was ``not
feasible.'' Consequently, on May 23, 1996, she referred the
entire matter to the President's Council on Integrity and
Efficiency (PCIE) for further review.
[See Attachment 10, Hill's letters to PCIE and Senator
Thompson, May 23, 1996, page 1]
PCIE Response
On October 16, 1996--five months after Hill's request was
made, the PCIE returned the case to the DOD IG ``for
appropriate handling,'' because Steakley's complaints
concerned IG employees--not the IG herself. [Attachment 10,
PCIE letter to Hill, page 2] Following another request from
the DOD IG on February 20, 1997, the Integrity Committee of
the PCIE agreed to review Steakley's allegations. In her
final request, Hill again expressed frustration over her
inability to conduct an independent review: ``Our attempts to
conduct an impartial internal inquiry have been hampered by
the increasing number of senior managers who have recused
themselves as a result of the growing allegations, including
the Director [Mancuso] of the office which would be
investigating this matter internally.''
[See Attachment 10, PCIE letter to Hill, October 16, 1996]
Case Referred to OSC
On June 3, 1997, the case was finally referred to OSC for
investigation.
[See Attachment 10, Hill memo to PCIE, February 20, 1997;
OSC letter to DOD IG, June 3, 1997; IC letter to PCIE,
January 8, 1999, page 2]
OSC Report and Conclusions
On July 21, 1998, the OSC completed a report on Steakley's
allegations about senior DCIS officials. The OSC report
focused primarily on prohibited employment practices and not
whether Walinski had falsified official reports on
investigation.
Despite a mountain of evidence pointing to a number of
unresolved issues, the OSC notified DOD in December 1998 that
Steakley's allegations ``were without merit,'' and the case
was closed in January 1999.
[See Attahcment 10, IC letter to PCIE, January 8, 1999.
page 2.]
McClelland's Investigation
On March 27, 1996--two months before Hill initially
referred the matter to the PCIE, she attempted to launch an
investigation of Steakley's allegations. This investigation
continued while Hill worked with PCIE/OSC to assume
responsibility for the investigation.
The job was assigned to the IG's Office of Departmental
Inquiries--an organization that is separate from DCIS--and
more independent, though both offices report to the same
boss--the DOD IG. Mr. Dennis Cullen was initially assigned as
the case action officer on April 2, 1996, but Mr. Greg
McClelland was placed in charge of the internal inquiry on
December 12, 1996.
Between January and June 1997, McClelland conducted a very
extensive set of interviews. The staff has examined the
transcripts of McClelland's interviews and believes that
McClelland conducted a very thorough and credible
investigation. He gathered all pertinent information needed
to prepare an independent report on Steakley's allegations.
While McClelland actually began drafting a report, it was
never finalized. Once the OSC agreed to assume jurisdiction
over the case on June 3, 1997, McClelland was directed to
terminate his effort and transfer all materials to the OSC.
Even though McClelland's report was never finalized, his
files contain important information bearing on the
allegations against Walinski--information that was completely
ignored by OSC.
McClelland's Investigative Plan
The guidance given to McClelland was clear. He was to
investigate all the allegations raised by Steakley, including
``alleged false statements'' by a DCIS investigator. On the
tax fraud inquiry, he intended to address this issue: ``Did
DCIS fabricate an ethics violation [suspected tax fraud]
against Mr. Steakley?'' He planned to ``review applicable
regulations'' to determine whether ``officials acted within
the scope of their authority.'' His investigative plan called
for questioning Gianino first. If warranted--based on
information obtained from Gianino, he would then interview
other DCIS officials as follows: Walinski, Hollingsworth,
Dupree, and Mancuso.
[See Attachment 11, page 3]
Gianino
On January 28, 1997, McClelland interviewed the key
witness--Gianino--regarding the contents of Walinski's
reported interview of her on May 21, 1993. In this interview,
Gianino disputes and contradicts virtually every point raised
in Walinski's report.
Walinski's report declares that the interview took place at
Gianino's Bolling AFB office on May 21, 1993. Gianino, by
comparison, testified that she had just one telephone
conversation with Walinski; that he called her; but she was
unable to remember when the call took place.
McClelland questioned Gianino about each individual part of
Walinski's report of interview. McClelland read her each
sentence in Walinski's report. In each case, he asked
Gianino: ``Is that accurate?'' And in each case, Gianino
replied: ``I did not call him.'' Or ``that's not a true
statement.'' Or ``that's not true.'' Or ``I did not do
that.'' On the question of sick leave between 1991 and 1993,
Gianino testified: ``I had maybe a couple of hours of sick
leave. But I was not out for a long extended period of time
due to illness.''
[See Attachment 2, Gianino interview, 1/28/97, pages 4-12]
Gianino's Leave Records
The staff examined Gianino's leave records for 1991 through
1993.
[[Page S13650]]
In his report of investigation, Walinski states: ``Very
shortly after her discussions with Steakley [in late 1991],
she [Gianino] became very ill and was off work for an
extended period of time. Because of her illness she was
unable to follow-up concerning Steakley. . . . In the Spring
of 1993, after her return from the extended illness, Mrs.
Gianino. . . .''
Walinski's assertions about Gianino's absence from her
Bolling AFB office due to an extended illness are
inconsistent with her official leave records.
Those records show: (1) Gianino used 54.5 hours of sick
leave in 1992; and (2) she used .5 hours in the first half of
1993 and a total of 15 hours of sick leave for the balance of
the year.
[See Attachment 12]
Walinski
McClelland then interviewed Walinski--first on February 14,
1997--and then again on June 6, 1997. After questioning
Walinski at length about other parts of his report of
investigation on the Steakley tax fraud case, McClelland
confronts him with the conflict between his report and
Gianino's sworn testimony:
``Okay. Well, Mr. Walinski, we have a problem. And the
problem is that Ms. Gianino controverts almost everything you
say about her in here [Walinski's report], under oath, on
tape.''
[See Attachment 2, Walinski interview, 2/14/97, page 62]
Walinski replies: ``Okay, Well,--In here somewhere we will
find the information that she provided to me, and it will be
in her handwriting.''
[See Attachment 2, Walinski interview, 2/14/97, page 62]
Walinski never produced any documentation from Gianino that
had a bearing on the contents or accuracy of his May 21, 1993
report of interview.
Then McClelland moved to the key question about sick leave.
Walinski's report contains a number of references to how
Gianino ``became very ill and was off work for an extended
period of time.'' McClelland asked this question:
``Okay. Ms. Gianino states that she was not out sick from
December 1991 to spring 1993, and the records substantiate
that.''
[See Attachment 2, Walinski interview, 2/14/97, page 65]
McClelland asked Walinski to explain the discrepancy
between his report and Gianino's official leave records. Here
is Walinski's response:
``Well,--well, the remembrance that I have is, folks, is
that she was out sick, and I remember everybody at
headquarters telling me that . . . I think she had cancer
really bad, ovarian cancer, and she would come into work and
work a couple of hours, and then she would go home.
[See Attachment 2, Walinski interview, 2/14/97, pages 14
and 65]
Under intense probing, Walinski admitted that the Gianino
interview may not have taken place on May 21, 1993--as stated
in his official report. He told McClelland: ``I interviewed
her [Gianino], like, two or three times.'' McClelland
responded to this revelation with another question: ``Why
isn't that reflected in the ROI [report of investigation]?''
Walinski's response helps to shed light on his investigative
methods. He told McClelland that his reports do not
necessarily reflect the way he conducted the investigation:
``Well, because one day I went over there and she told me
this information. Another day I went over there and I
interviewed her and I was interviewing her about another,
you, something else.''
[See Attachment 2, Walinski interview, 2/14/97, pages 63-
65]
During the second interview on June 6, 1997, McClelland
attempted to determine if there was any concrete linkage
between Walinski's handwritten notes of the Gianino interview
and the final version of the interview that accompanied his
report of investigation. McClelland determined that there was
essentially no linkage. Not one important fact contained in
the final report could be traced back to Walinski's
handwritten notes. And Walinski agreed with McClelland's
assessment. The Majority Staff examined those notes and
agreed with McClelland's assessment. Walinski's notes are
undated and cannot be considered proof that the interview
took place. McClelland asked Walinski about the disconnect.
Walinski replied:
``I don't write down verbatim what people tell me, so I
remember she just said she was out . . . I just write down
highlights in my notes . . . Just enough that jogs my memory
so I can remember what people said.''
[See Attachment 2, Walinski interview, 6/6/97, pages 28,
37, 69]
Staff Interviews Gianino
Gianino was interviewed on June 30, 1999 regarding her
knowledge of Walinski's May 21, 1993 witness interview
report.
At the beginning of the interview, the Majority Staff gave
her an opportunity to examine Walinski's report. She had
never seen it. She re-confirmed all the facts previously
developed by McClelland. Point-by-point, she characterized
Walinski's report as completely false. She stated that she
was never interviewed by Walinski but may have spoken to him
briefly on the telephone. She noted that he was even mistaken
about her GS grade. Walinski reported that she was a ``GS-12
Payroll Specialist'' at the top of the witness interview
form. In fact, Gianino was a GS-7 Payroll technician on the
date of the interview. When asked why she thought Walinski
fabricated his report of interview, she offered this opinion:
``DCIS was out to get Steakley. They wanted to destroy
him''
On August 20, 1999, the staff conducted a follow-up
interview with Gianino. At that time, she was shown portions
of Walinski's sworn testimony to McClelland on February 14,
1997 where he attempted to explain the discrepancy between
his report and her leave records. In this testimony, Walinski
fabricated a new reason for his May 1993 report about her
extended absences from the office. He suggested that ``she
had cancer really bad, ovarian cancer.'' Gianino was shocked
that Walinski had made such a statement under oath. She said:
``that statement is not true. I have never had ovarian
cancer.''
Staff Interviews Walinski
On September 8, 1999, the Majority Staff questioned
Walinski about the accuracy of his May 21, 1993 interview of
Gianino. During the meeting, he attempted to offer evidence
that his reported interview of Gianino did, in fact, take
place.
This is the explanation offered by Walinski:
Since Steakley had refused to cooperate with the
investigation and provide his state income tax returns, DCIS
could not prove that Steakley had failed to meet his state
tax obligations. This shortcoming was painfully evident when
the ARB Board met to review the Steakley case. Walinski's
report did not answer the key question: What were Steakley's
total unpaid tax liabilities? Exactly how much did he owe
Virginia and California?
The ARB wanted that question answered. So Walinski was
called into the ARB Board meeting and directed to get the
missing information. Walinski claims he contacted Gianino on
the telephone and then went over to her office at Bolling
AFB. At this meeting, she provided the earnings data that he
needed to calculate Steakley's unpaid state taxes for the
Board. He said there were detailed notes containing the tax
calculations. He further stated that some of those notes were
in Gianino's handwriting, and they prove that the Gianino
interview actually took place as he reported.
[See Attachment 14]
Walinski offered essentially the same explanation to
McClelland in testimony on February 14, 1997, and June 6,
1997.
Walinski's explanation does not stand up to scrutiny for
three reasons:
First, Walinski's handwritten notes that he purportedly
took during his interview of Gianino on May 21, 1993 do not
contain tax calculations or references to them.
Second, The final version of Walinski's report of interview
with Gianino on May 21, 1993 contains no reference to income
tax calculations.
Third, since the ARB Board did not meet on the Steakley tax
evasion case until February 17, 1994--nine months after the
reported Gianino interview, and since Walinski claims the tax
calculations were prepared in response to a question that
arose during the Board meeting, the notes on tax
calculations--if they ever existed--could not constitute
proof that the Gianino interview took place as reported by
Walinski.
McClelland's Evaluation of Walinski
McClelland was interviewed on August 4, 1999 to elicit his
impressions on the irreconcilable differences between the
testimony of Walinski and Gianino. This is what McClelland
stated:
``While he was unable to document willful intent on the
part of Walinski, he characterized Walinski's conduct and
reporting in the Steakley tax fraud case as egregious.
Walinski was a sloppy investigator. His report contained
widespread discrepancies and inaccuracies.''
Response by Management
This portion of the reports addresses the question of how
DCIS management responded to allegations that Walinski had
fabricated his official report on the Steakley investigation:
Did DCIS management make an honest attempt to review the
allegations about Walinski's report?
The Majority Staff was unable to find any evidence to
suggest that DCIS management attempted to evaluate complaints
that Walinski had falsified his report on the Steakley tax
fraud case.
Examples of how DCIS management responded to the
allegations are cited below.
Bonnar
In a memo dated November 15, 1994, Bonnar--Walinski's
immediate supervisor--reported that he had received a
telephone call from Steakley the previous day--November 14,
1994. Bonnar reported that Steakley asked if Dupree had
launched an investigation into Mr. Walinski's actions.
Steakley had requested the investigation during his meeting
with Dupree on October 20, 1994. Bonnar told Steakley:
``there are no pending internal administrative inquiries
involving your case.''
In the memo, Bonnar also reported on Steakley's overall
impressions of DCIS' commitment to reviewing Walinski's
actions:
``It was clear to him [Steakley] that Mr. Dupree had
decided not to act on his request for an investigation.
[See Attachment 8, page 2]
Hollingsworth
According to the OSC report, Dupree asked Hollingsworth to
be certain that Walinski's
[[Page S13651]]
report was consistent with the facts, and Hollingsworth
assured him that there was no truth to Steakley's
allegations:
``Dupree asked Hollingsworth to look into the [Walinski]
matter and recalled that he was assured by Hollingsworth that
the documents were in support of the information . . . and
found the allegation was not correct.''
[See Attachment 15, pages 15 and 22]
OSC's assessment does not seem to square with the facts.
First, there is no evidence to suggest that Hollingsworth
investigated the accuracy of Walinski's report. Quite to the
contrary, a memo signed by Hollingsworth on November 23, 1994
suggests that he had no plan to do it--unless Steakley
provided more specific information Hollingsworth stated:
``Based on a review of the allegations made by SA Steakley,
no action will be taken until he provides written
documentation.''
[See Attachment 16]
Use of the words ``written documentation'' seems important,
since Steakley had taped a conversation with Gianino on
September 8, 1994 suggesting that Walinski had falsified the
interview. Testimony by Dupree, which is cited in the next
section of this report, indicates that management knew about
the tape but refused to consider it as a useful piece of
evidence.
Secondly, it seems like Hollingsworth thought he knew the
answer to the key question surrounding the accuracy of
Walinski's report--Gianino's leave status. In his November
23, 1994 memo, Hollingsworth indicated that he had already
made up his mind on this core issue:
``The one issue that can be readily resolved is the issue
of Mrs. Nancy Gianino's leave status. Contrary to SA
Steakley's allegations, her lengthy leave was well known at
DCIS since she handles the payroll at Bolling AFB for DCIS.''
[See Attachment 16]
An independent interview of Gianino and review of her leave
records would have quickly resolved all the issues
surrounding Walinski's report of investigation. However,
Hollingsworth failed to pursue this line of inquiry.
Dupree
On March 13, 1997, McClelland interviewed Mancuso's Deputy,
Mr. William Dupree, about his knowledge of and reactions to
allegations that Walinski had falsified his report on the
Steakley tax evasion case.
Initially, Dupree flatly denied having any knowledge about
Walinski's fabricated reports. For example, McClelland asked:
``Were you aware of factual inaccuracies in the [Walinski]
ROI [report of investigation]?'' Dupree's answer: ``No.''
McClelland's follow-up question: ``You weren't?'' Dupree:
``No.''
[See Attachment 2, Dupree interview 3/13/97, page 37]
Fortunately, McClelland pressed Dupree about the issue and
succeeded in making Dupree admit he was aware of the problem.
From his response, it seems very clear that he never had any
intention of examining the accuracy of Walinski's reports.
Question
McClelland asked him if he remembered if the subject of
``false information in Walinski's ROI [report of
investigation] came up at a meeting in his office [Meeting
with Steakley and Cerasi in October 20, 1994].''
[See Attachment 2, Dupree interview, 3/13 97, page 38]
This was Dupree's response:
Response
``Oh, Gary [Steakley] was making all kinds of statements
about things. Yeah. The falseness, you know, allegedly there
are false statements. But you know, he didn't provide any
facts or information.''
[See Attachment 2, Page 38]
Question
McClelland then began questioning Dupree about his response
to allegations that Walinski had falsified the Gianino
interview. McClelland asked this question: ``Did you take any
action to look into that?''
Response
``Other than to assure Larry [Hollingsworth], `Let's make
sure that what we're doing is something we can support and
back it up and everything. But Gary didn't offer anything. He
said he had a tape [interview with Gianino on September 8,
1994]. And I'm saying, Gary, you know, I need more than
that.''
[See Attachment 2, Page 39]
Question
McClelland turned to the crucial follow-up question: ``Did
anybody call Gianino and find out, find out what she had
actually said?''
Response
Dupree's response is very revealing. It suggests he never
had any intention of checking out the questions about the
inaccuracy of Walinski's report. He said:
``I have no reason to question the statement that she
provided to Walinski, an agent, no different than the
statement I provide to you.''
Question
McClelland responded with this question: ``Well, you have
an allegation from Gary [Steakley]?''
Response
``Allegation. With what? He is the person that's being
investigated. I had reason to believe Gary [Steakley] was
making a speculative allegation without any evidence other
than he doesn't like Matt Walinski.''
Final Exchange
McClelland closed this segment of the interview with
another question:
``If you were to find out that there were inaccuracies in
the ROI [report of investigation] with regard to--.''
However, before McClelland could complete the sentence,
Depuree jumped in with this assertion: ``I would do the
similar thing we previously did.'' So McClelland asked: And
what's that? Dupree's response: ``Investigate it.''
[See attachment 2, page 41]
The Majority Staff's puzzled by Dupree's response to the
last question. He had allegations--from FLEOA and Steakley--
about inaccuracies in Walinski's investigation report. Why
did he fail to investigate them?
Hollingsworth provided a partial answer to this question
during an interview on August 24, 1999. Hollingsworth
asserted:
``DCIS gave absolutely no credence to Steakley's
allegations.''
Mancuso
McClelland also interviewed DCIS Director Mancuso on March
13, 1997.
Mancuso's responses to McClelland's questions clearly
indicate that he was aware of the allegations about
Walinski's report.
This is Mancuso's response to McClelland's question about
his knowledge of inaccuracies in Walinski's report of
investigation and the Gianino interview:
``I know that there was a question that Gary [Steakley] had
as to where Matt [Walinski] had gotten the information. I
remember something on that * * * * But it was--what I heard
of complaints, I heard from Gary. I'm not aware from Bill
[Dupree] or from anyone else that there was anything
inaccurate in Matt's report.''
[See Attachment 2, Mancuso interview, 3/13/97, page 27]
McClelland then asked Mancuso: ``What did you hear from
Gary [Steakley] on that [inaccuracies in Walinski's report]?
In replying to this question, Mancuso indicates that
Steakley's allegations about Walinski's report were coming
into his office and being relayed to him through secondary
sources:
``I would walk down the hall and somebody would say
Steakley called me up last night, and he was saying that Matt
Walinski had not attributed remarks properly in some way and
that kind of thing.''
[See Attachment 2, Mancuso interview, 3/13/97, page 26]
McClelland follow up by asking: Did he [Steakley] tell you
anything about a woman over at payroll called Nancy Gianino?
Mancuso's reply suggests that he was not only familiar with
Gianino's name, but more importantly, he heard about her from
sources other than Steakley. It also suggests that Mancuso
had knowledge of the core problem with Walinski's report.
This is Mancuso's reply: ``I've heard that from other people.
I did not hear it from Gary.'' Mancuso's response to that
question prompted McClelland to suggest that Mancuso had
``some idea of the allegations that Steakley was making with
regard to Gianino?'' Mancuso admitted that he did but again
claimed that it was coming from Steakley.
[See Attachment 2, Mancuso interview, 3/13/97, pages 26-27]
Mancuso's response to these questions is consistent with
the assessment presented by the OSC in its report of July 21,
1998 on the Steakley case, OSC concluded:
``Mancuso was aware of the conflict between the Walinski
interview of Gianino and Steakley's version of the interview.
However, Mancuso was not aware of any manufactured
information relating to Steakley.''
[See Attachment 15, page 22]
Mancuso Ignored Walinski Problem
To summarize, Mancuso admits that he knew about Steakley's
allegation that Walinski had fabricated the Gianino
interview, but no one in DCIS, including Dupree, had ever
suggested to him that there was any truth to those
allegations. Clearly, management did not give the allegations
much credibility. As Hollingworth put it: ``DCIS gave
absolutely no credence to Steakley's allegations.''
It seems very clear from Mancuso's testimony that he never
considered the need to investigate the allegations. The
apparent lack of curiosity on the part of the most senior
criminal investigator at the DOD IG is astonishing. As a
result, the allegations about Walinski were never examined,
and no corrective action was taken.
the case of mr. Johanson
Walinski initiated this inquiry--Administrative Inquiry
108--on February 23, 1994 after DCIS headquarters, including
Bonnar, Hollingsworth, and Nancuso, were officially notified
that a DCIS-issued weapon was stolen from the home of Special
Agent Stephen Johanson, who was assigned to the Van Nuys
Resident Agency office in California.
Stolen Gun
DCIS had issued Johanson two weapons: (1) a 9mm Sig Sauer
that he normally carried; and (2) a smaller Smith and Wesson
revolver for undercover work.
Sometime between February 14 and February 16, 1994, while
Johanson was participating in the execution of a search
warrant in San Diego, his home in Palmdale was burglarized.
The burglars stole a number of items valued at about
$10,000.00, including jewelry and the loaded Smith and Wesson
revolver. The stolen revolver was issued to Johanson because
of his involvement in an
[[Page S13652]]
undercover operation the previous year. Since an earthquake
had severely damaged the Van Nuys Resident Agency office and
made it insecure--and no Class-5 safe was available there,
Johanson kept this weapon stored on the top shelf of his
bedroom closet under a pile of clothing. When he returned
from San Diego on February 16th and discovered the burglary,
he immediately notified the local police authorities and DCIS
management of the break-in and loss of the service weapon.
Walinski's Report
Walinski reported that he conducted the following
interviews of DCIS officials assigned to the Los Angeles
Field Office: (1) Richard Smith, Special Agent in Charge
(SAC)--March 4, 1994; (2) Robert Young, Assistant Special
Agent in Charge (ASAC)--March 2, 1994; (3); Jon Clark, Group
Manager--March 2, 1994; (4) Michael R. Shiohama (RAC)--March
2, 1994; (5) Michael D. Litterelle, Firearms Coordinator--
March 3, 1994; and (6) Stephen J. Johanson, Special Agent--
March 3, 1994. While all the interviews were conducted during
a 3-day period, March 2-4, it took Walinski more than five
weeks to sign, date, and finalize these interviews. They are
actually dated April 12-13, 1994.
Based on these interviews, Walinski reached four important
conclusions. These conclusions are contained in his report of
investigation: First, Johanson's supervisors--RAC, SAC, and
ASAC--never authorized Johanson to have the undercover weapon
issued to him. Second, has supervisors did not know that
Johanson had the undercover weapon until it was reported as
stolen. Third, Johanson informed the Group Manager (Clark) on
February 10, 1994 that he had the undercover weapon, and the
Group Manager ``immediately'' instructed him to turn it in at
the next firearms range training session scheduled for March
7, 1994. And fourth, neither Johanson nor the Firearms
Coordinator could remember who authorized Johanson to have
the undercover weapon.
[See Attachment 1, Report of Investigation, Synopsis]
Walinski completed this inquiry on April 15, 1994. On that
date, Hollingsworth forwarded Walinski's report of
investigation and appended interviews to Dupree ``for
whatever action you deem appropriate.''
[See Attachment 1, letter of transmittal]
ARB Recommendation
The Administrative Review Board (ARB) met on April 21, 1993
to consider Walinski's report on the Johanson case.
After reviewing Walinski's report, the ARB reached these
conclusions: (1) Johanson stored a government-issued weapon
at his residence while on ``extended leave or non-duty status
for 5 or more consecutive days'' in violation of Section
3807.4 of the DCIS Special Agent's Manual; and (2) Johanson
was not authorized to posses two issued weapons. The ARB also
concluded that Johanson failed to return the weapon at the
conclusion of the undercover operation and failed to sign the
proper forms when the weapon was issued to him.
The ARB recommended that Johanson be suspended for 10 days
without pay. The ARB's report, dated May 9, 1994, was
forwarded to the SAC, Los Angeles Field Office, Richard R.
Smith, for consideration.
[See Attachment 2, page 1]
Charges
On June 24, 1994, Smith issued a Notice of Proposed
Suspension to Johanson. Smith recommended that Johanson be
suspended without pay for 8 calendar days: for failing ``to
sign for, properly secure, and return a weapon issued to you
for an undercover assignment.''
Smith's memo to Johanson recited many facts taken directly
from Walinski's report of investigation and accompanying
interviews. These same facts were subsequently disputed--and
formally challenged--by many of the agents involved.
Smith's decision to discipline Johanson seemed to hinge on
one piece of disputed information developed by Walinski. This
was a meeting that allegedly occurred in the Van Nuys
Resident Agency office on February 10, 1994. At this meeting,
Walinski claimed that Group Manager Jon Clark informed
Johanson that he would not be assigned to an ongoing
undercover operation known as ``Skyworthy.'' According to
Walinski, Johanson then informed Clark that he still had an
undercover weapon. At this point, Walinski states, Clark told
Johanson to bring the weapon to the next firearms
qualification session to be held on March 7, 1994. This
particular assertion appears in Walinski's interviews of
Young, Clark and Johanson as well as in his report of
investigation. The February 10, 1994 meeting is the
centerpiece of Smith's Notice of Proposed Suspension. Smith
used this piece of information as the basis for charging
Johanson with failing to return a weapon issued to him for
undercover work. This is what Smith said about the alleged
February 10, 1994 meeting attended by Clark:
``On February 10, 1994, you [Johanson] were informed by
Group Manager Clark that you would not be part of the
undercover operation relocated from 50PX [Phoenix]. When you
told Group Manager Clark that you still had a second weapon
in your possession he instructed you to bring it to the next
50LA range qualification on March 7, 1994. Before you could
return the weapon, your home was burglarized and the gun was
stolen.''
[See Attachment 3, page 1]
Rank and File Challenge Walinski's Report
The first formal complaint about Walinski's report on the
stolen gun case was initiated on the day Johanson received
Smith's Notice of Proposed Suspension--July 6, 1994--and saw
the erroneous information about the February 10th meeting.
The first complaint was embodied in a sworn statement
signed jointly by Supervisory Special Agent Jon Clark and Mr.
Thomas J. Bonnar--Walinski's immediate supervisor at DCIS
Headquarters in Washington. While this statement was signed
on July 19, 1994, it concerned a telephone conversation
between Johanson and Clark on July 6, 1994. The joint Clark/
Bonnar statement clearly suggests that Walinski falsified
information in this report of investigation on the stolen gun
case.
Portions of the joint statement are summarized below.
After receiving Smith's Notice of Proposed Suspension on
July 6, 1994, Johanson called Jon Clark on the telephone to
express alarm and confusion over a statement in Smith's memo
that was attributed to Clark. Johanson read the following
statement to Clark:
``That he [Johanson] was instructed by Group Manager Jon
Clark on February 10, 1994, that he was not going to be
participating in the undercover operation at LAFO [Los
Angeles Field Office] and that he should return the
undercover weapon he had at the next firearms
qualification.''
[See Attachment 4, page 1]
Johanson informed Clark that he had no recollection of
receiving this instruction from Clark and asked Clark if he
could recall giving it. This is how Clark responded to the
news:
``I was astonished and confounded by this statement. I
asked him to re-read the statement. I said I have no idea how
or why that statement was in the letter. I said I had no
recollection of providing him those instructions nor had I
any recollection of saying that to anyone. Moreover, I was
not aware of the fact that he had an undercover weapon.''
[See Attachment 4, page 1]
Clark told Johanson that he would check his calendar for
the date of February 10, 1994 to verify whether he was at the
meeting in the Van Nuys Resident Agency office as reported by
Walinski. In checking his calendar, he discovered that he was
not in the Van Nuys office that day. Instead, he spent that
entire day at the El Segundo Resident Agency office on other
business with both Young and Smith [Smith and Young later
confirm the fact. Smith and Young were the SAC and ASAC in
the Los Angeles Field Office].
Following the phone conversation with Johanson, Clark
contacted Smith and Young in the Los Angeles Field Office to
inquire about the origins of the assertions in Smith's letter
to Johanson. Smith advised Clark that the information on the
February 10, 1994 meeting was extracted for Walinski's
``internal'' report of investigation (ROI). At that point,
Clark assured Smith that ``he had not provided a statement on
this investigation.'' Clark asked Smith to double-check the
ROI ``to be sure that was no mistake.'' Smith re-checked the
ROI and ``advised me that there was a DCIS Form 1, Report of
Interview of me.''
Clark denied again that he was ever interviewed by
Walinski. This is what he said to Smith:
``I was perplexed. I advised SAC Smith that I had no
recollection of this report being taken and asked that I be
permitted to read it to refresh my recollection. He said no.
. . . I informed SAC Smith that these were facts that I not
only did not say--but information I did not know. . . . I
could not corroborate the statement attributed to me in SAC
Smith's letter to Johanson. . . . I cannot believe I made
those statements since I had no specific knowledge of those
facts. The statements appear to be factually inaccurate, and
therefore would not have been stated by me.''
[See Attachment 4, page 1-2]
About a week later--on July 5, 1994--Mr. Michael D.
Litterelle [Firearms Coordinator] informed Clark that he had
a copy of Walinski's ROI, and Litterelle actually gave Clark
a copy of Walinski's form 1 Witness Interview of Clark. After
reading it, Clark stated:
``I read the interview and found it contained statements
that were attributed to me that I knew were untrue. . . . I
never made this statement.''
[See Attachment 4, page 3]
The exact distribution of the joint Bonner-Clark statement
is unknown. However, since it was ``solicited'' by Bonner,
the Assistant Director of internal affairs, it would not be
unreasonable to assume that Hollingsworth--the director--and
other DCIS managers knew about it and actually saw it.
Supervisor Challenges Walinski's Report
Several weeks after the Bonnar/Clark complaint, another
formal complaint about Walinski's report was submitted to
Hollingsworth's office. This one was signed on August 4, 1994
by ASAC Young in the Los Angeles Field Office. It contained a
detailed, line-by-line commentary on inaccuracies in
Walinski's interview of Young along with highly critical
comments on Walinski's interviews of Clark and Shiohama on
the same date [March 2, 1994].
Young stated that he was ``somewhat shocked'' after reading
Walinski's report. He stated that Walinski's report contained
statement that were misleading, ``wrong''
[[Page S13653]]
and ``inaccurate.'' He said that Walinski attributed
statements to him that he never made.
After alluding to the ``significant discrepancies'' in
Walinski's interview of Clark, Young reports that Shiohama
had advised him that ``there were subject areas in the report
or statements that he had not discussed with SA Walinski.
Shiohama stated that the last paragraph of his interview was
totally inaccurate.'' However, both Young and Shiohama
insisted that portions of their interviews appeared to
accurately reflect what they had said to Walinski.
Appeal to Management About Walinski's Reports
In asking Hollingsworth to examine the discrepancies in
Walinski's report, Young makes an appeal to senior management
on behalf of rank and file agents:
``I am not trying to cause you or Matt [Walinski] problems.
But in this situation I am caught in the middle. I have
agents that are in the process of being disciplined and based
on what I know now the recommended disciplinary actions may
be based on incomplete and inaccurate information. The agents
throughout the Field Office know this and are now finding
fault with management for not taking some type of action to
have this situation re-evaluated.''
[See Attachment 5, Note from Young to Hollingsworth]
Young's report was officially moved up the chain of
command--to the top. Young forwarded it to Bonnar who, in
turn, submitted it to Hollingsworth, and Dupree--Mr.
Mancuso's Deputy. However, during an interview on September
14, 1999, Mancuso denied having knowledge of the allegation
that the Clark interview was fabricated until recently or
August 1999.
FLEOA Letter
Young's formal complaint to Hollingsworth about Walinski's
inaccurate reports was followed almost immediately by a
formal complaint from another source.
During the adjudication phase of the stolen gun case,
Johnson was represented by an attorney with the Federal Law
Enforcement Officers Association (FLEOA), Luciano A. Cerasi--
the same lawyer who represented Steakley in the tax evasion
case.
In a letter to Dupree, dated August 8, 1994, regarding the
Johanson case, Cerasi raised the possibility that Walinski
had falsified his report of investigation. Cerasi's letter
contains this explosive allegation:
``It is questionable whether SA Walinski even interviewed
SA Clark.''
Cerasi also raised questions about why five weeks elapsed
between the dates on which Walinski conducted the disputed
interviews and the final dates on the interview reports.
Cerasi suggested that this delay violated DCIS policy
requiring that witness reports be completed and finalized
within 3 working days of the investigative activity. Cerasi
characterized Walinski's report as a ``shabby investigative
effort'' that would only serve to demonstrate to other agents
that in DCIS ``justice is unattainable.''
[See Attachment 6, pages 3-4]
Attempted DCIS Coverup Possible
Initially, DCIS management may have tried to put a lid on
the groundswell of adverse information on Walinski's reports
that began to surface in mid-1994. First, there were
complaints from rank and file agents--Clark, Young, and
Shiohama--in July and August 1994. Those were followed
immediately by the FLEOA letter. A month later--in September
1994--FLEOA filed a second complaint with management. This
one concerned allegations that Walinski had fabricated the
Gianino interview.
The sworn statement signed jointly by Bonnar and Clark
alludes to a possible attempt by DCIS management to keep a
lid on all the complaints about Walinski's reports:
``On July 8, 1994, ASAC Young advised me that HQ [DCIS
Headquarters] had decided that they would wait and not raise
the issue regarding my discrepant interview unless it was
raised by SA Johanson. I [Clark] expressed concern that this
may be released to agents and that they may conclude that I
fabricated this story and it would therefore discredit me. I
was informed that the information was controlled in its
release.''
[See Attachment 4, pages 2-3]
On August 9, 1999, the staff contacted the DOD IG with this
question: ``Who at DCIS made this decision?'' The following
answer was provided on September 30, 1999: ``We have not been
able to determine who, if anyone, made this alleged
decision.''
Re-Investigation
As a result of all the complaints. DCIS management
eventually made a decision to launch a re-investigation of
the Johanson stolen gun case. The re-investigation was
conducted by SA Timothy L. Shroeder from August 10, 1994
until October 5, 1994.
Unfortunately, the re-investigation was conducted in a
complete vacuum--as if the entire matter had never been
investigated by Walinski.
It is easy to understand why DCIS needed to go back to
square one and re-examine all the facts bearing on the stolen
weapon. The second investigation had to be impartial and
independent after Walinski was accused of falsifying
information contained in the original investigation. At the
same time, DCIS management had a responsibility and an
obligation to determine whether Walinski had falsified his
report--as alleged by rank and file agents. Unfortunately,
there was no attempt to reconcile the facts contained in
Walinski's report of investigation with the facts developed
in the re-investigation. In fact, the agent in charge of the
re-investigation--Shroeder--received specific instructions to
steer clear of the disputed interviews. Hollingsworth gave
him these instructions: The ``new investigation should be
conducted without reviewing the results of the previous
interviews.''
[See Attachment 7]
Clearly, Shroeder needed to avoid the pitfalls created in
first investigation, but management should have assigned
another agent to examine the allegations made about
Walinski's report. If Walinski bungled his investigation and
the case had to be re-investigated, then DCIS management
should have determined exactly where and how Walinski's
investigation deviated from accepted standards. All the
complaints from rank and file agents and the FLEOA attorney
required nothing less than that.
New Charges
Based on the re-investigation, Smith recommended that
Johanson be suspended without pay for 10 calendar days.
Smith's second Notice of Proposed Suspension was dated
November 23, 1994. Smith charged Johanson with violating two
sections of the Special Agents' Manual: (1) Failing to
exercise ``utmost caution'' in storing a firearm at his
residence; and (2) Storing a weapon at his residence while
away from his assigned office for an extended time.
[See attachment 8, pages 1-2]
In the final notice on suspension, dated February 9, 1995,
Durpee suspended Johanson for 3 calendar days, beginning on
February 15, 1995.
[See attachment 9]
Need for Investigation Questioned
It's difficult to understand why DCIS would suspend an
agent for losing a gun that was stolen from his home during a
burglary. The staff checked with other federal law
enforcement authorities to determine how similar cases have
been handled in the past. Under normal circumstances, they
suggested that a routine administrative inquiry would be
conducted. Once it was determined that the firearm was stolen
during a burglary and the theft was duly reported to the
proper authorities, the entire matter would be dropped.
Walinsky ``Disciplined'' for Bungled Investigation
On July 20, 1999 and again on August 4, 1999, Ms. Jane
Charters was interviewed regarding her knowledge of personnel
actions taken against Walinski in the wake of the bungled
Johanson investigation.
Ms. Charters is currently the Director of the Investigative
Support Branch at DCIS--the same position she occupied in
1994 during the Johanson and Steakley investigations. She
exercises personnel responsibilities in DCIS.
During the first interview of July 20, 1994, Charters
stated that as a result of mistakes in stolen gun case
investigations, DCIS ``lost confidence'' in Walinski and
transferred him out of internal affairs and into her office.
In the new position, Walinski was no longer conducting
internal investigations. Instead, he was to be responsible
for DCIS training, physical fitness and security. Charters
also reported that Walinski was issued a letter of reprimand
that was placed in his file--a fact that was confirmed by
Bonnar during an interview on July 12, 1999.
Walinski's Personnel File
On two occasions in July--July 7th and again on July 23,
1999, the Majority Staff examined Walinski personnel file to
determine if the disciplinary actions taken against him for
his mistakes in Johanson investigation--as described by
Charters and others--were accurately reflected in performance
ratings and other personnel actions in his file.
The Majority Staff found no evidence that Walinski was ever
disciplined for the failed Johanson gun case. Quite to the
contrary, the available evidence suggests Walinski was
actually rewarded for what happened.
Here is what the Majority Staff found in his file:
Employee Performance Rating--1993/94
For the rating period August 26, 1993 to March 31, 1994,
Walinski received an ``outstanding'' rating.
The outstanding rating applied to the period of time when
Walinski conducted two investigations--Steakley and
Johanson--where the accuracy of his reports were later
questioned. In fact, the rating period included the date--
March 2, 1994--on Walinski claims he conducted interviews
with Young, Clark, and Shiohama. Those reports of interview
were later characterized as false, misleading and inaccurate
by the agents involved and the FLEOA attorney. The Gianino
interview occurred on May 21, 1993--just prior to the
beginning of the rating period, but considerable
investigative activity on the Steakley case occurred during
his rating period.
The rating officials offered this comment: ``Walinski
continues to excel in every aspect of his job. He is a very
valued employee of DCIS.'' The outstanding rating was
approved by Bonnar and the Director of internal affairs,
Hollingsworth, on April 15, 1994--the exact same day that
Hollingsworth forwarded Walinski's completed report of
investigation on the Johanson case to Dupree.
[See attachment 10]
Incentive Award Nomination--Recommendation
On April 25, 1994, Hollingsworth recommended that Walinski
receive a performance award of $1,200.00 to accompany the
[[Page S13654]]
``outstanding'' rating he received for the period August 1993
to March 1994--the same period when he conducted witness
interviews in the Johanson case that were later characterized
as false, inaccurate and misleading.
[See attachment 11]
Previous Cash Award--1993
The form used to recommend the $1,200.00 performance award
also noted that Walinski had not received any other
performance awards in the preceding 52 weeks. His personnel
file indicates otherwise. He received a ``Special Act or
Service Award'' of $2,000.00 on May 2, 1993--several weeks
before his fabricated interview with Gianino on May 21, 1993.
[See Attachments 11 & 12]
Special Performance Rating--1994
This a special rating given to Walinski immediately before
his sudden transfer out of internal affairs and into the
Investigative Support Directorate. It was the last rating he
received for his work in internal affairs and covered a
``shortened rating period'' of April 1, 1994 through July 2,
1994. This rating period includes the date on which Walinski
finalized the report of investigation on the Johanson case--
April 15, 1994. The closing date for this reporting period--
July 2, 1994--came one day before his move to Charters'
office and just four days before the first known written
complaint about Walinski's false and inaccurate reports
reached DCIS Headquarters in Washington.
Bonnar and Hollingsworth gave him a ``fully successful''
rating, but for unexplained reasons, took over three months
to approve it. It was finally signed on October 12, 1994.
Walinski's other ratings were approved quickly--within two
weeks of the end of the rating period.
[See Attachment 12].
DCIS says the delay was due to ``an administrative
oversight.''
Walinski stated August 2, 1999 that this is the rating
where ``he took a hit'' for his mistakes in the Johanson
case. The language in the performance rating documents seemed
to support Walinski's assessment:
``Unfortunately, during this rating period he failed to
show due diligence and accuracy in reporting the results of
some interviews with regard to one administrative inquiry.
This one shortfall in SA Walinski's performance is not
typical of the otherwise high quality and professional level
of his work.''
[See Attachment 13, pages 3-4]
when Bonnar and Hollingsworth signed this document in
October 1994, they had already received the allegations about
Walinski's false reports on the Steakley tax evasion case.
For that reason, the reference to ``accuracy of reporting''
in just one internal investigation does not appear to square
with the facts.
Reassignment
Walinski's personnel records indicate that his transfer
from internal affairs to the Investigative Support Branch
became effective on July 3, 1994.
[See Attachment 14]
As previously reported, Charters suggested during two
interviews that DCIS management ``had lost confidence in
Walinski'' as an investigator ``and moved him into her
office'' as a disciplinary measure. Charters' description of
the reasons behind Walinksi's transfer are consistent with
those provided by Mancuso during an interview on September
14, 1999.
Hollingsworth and Walinski, by comparison, provided a
completely different set of reasons behind the July 1994
move.
During an interview on August 24, 1994, Holllingsworth
suggested that the move was not taken for disciplinary
reasons: ``It was for his health.'' He said Walinki ``blew''
the Johnason case because ``he was totally stressed out.''
Hollingsworth feared he might ``have a heart attack.''
Walinski meaintains that the transfer was driven by routine
considerations.
During an interview on September 8, 1999, he gave the
following reasons for the move: (1) There was an attractive
opening in Charters' organization; (2) The opening offered
him some growth potential into a management position in the
future; (3) He had completed his planned 3-year tour of duty
in internal affairs; and (4) He had a plan for addressing the
training deficiencies in Charters' Directorate. When asked if
there was any other reasons for the move, he said ``No.''
[See Attachment 15, pages 1-2]
Walinski Assigned Inspection Duties
A personnel document, signed by Bonnar and Hollingsworth on
October 12, 1994 suggests that Walinski conduct inspections
long after he was reassigned to ``training'' in Charters'
office. Along with inquiries of employee misconduct,
inspections are the main responsibility of the internal
affairs office. This document suggests that Walinski continue
to perform, work for the internal affairs office--despite his
removal from that office. This document shows that Walinski
played a leadership role in various inspections as follows:
``He also worked on the preparation for the Los Angeles FO
[field office] inspection. Although the Los Angeles FO
inspection was conducted after the end of this special rating
period when SA Walinski reported to his new assignment in the
Investigative Support Directorate, he returned to assist with
the LA inspection and played a significant role by leading
inspection efforts in the DCIS offices in Phoenix, Tuscon,
Albuquerque, and Honolulu as well as Los Angeles. He worked
independently on these inspections without the need for any
close supervision.''
[See Attachment 13, page 3]
During an interview on September 14, 1999, Mancuso
expressed surprise that Walinski led the inspection of the
Los Angeles field office after his reassignment:
Mancuso said he had no knowledge of Walinski's involvement
in the inspection of the LA Field Office after his transfer.
He would be surprised and concerned if true, and said he
would be checking on the accuracy of that information.
Decision on Inspection Duties Questioned
In an information paper provided on September 30, 1999,
Mancuso admitted that Walinski was involved in the inspection
of the Los Angeles Field Office. However, Mancuso maintains
Walinski was kept on the team only ``to train his
replacement'' and ``did not participate in the actual
inspection.'' Mancuso's statement conflicts with the
personnel document signed by Bonnar, Hollingsworth, and
Walinski in 1994 referenced above.
It is very difficult to understand why Walinski would have
been assigned to prepare the inspection report on the Los
Angeles Field Office in the wake of all the allegations and
complaints flowing from the Johanson case. The re-
investigation of the Johanson case, which began in August
1944 and was concluded in October 1994, was in progress while
Walinski conducted the inspection of the Los Angeles Field
Office. That re-investigation was specifically triggered by
his disputed interviews of at least three agents assigned to
the Los Angeles field Office. Those agents made formal
complaints to management about the quality of Walinski's
reports. In effect, these agents ``blew the whistle'' on
Walinski. Assigning Walinski a leadership role in the Los
Angeles Field Office inspection could be viewed as a
retaliatory measure, and as such, a very questionable
management decision.
Performance Award--1994
On July 24, 1994--exactly three weeks after his transfer
from internal affairs into training, Walinski received a cash
award of $1,200.00.
[See Attachment 16]
At our meeting with Charters on August 4, 1997, she offered
an explanation for the $1,200.00 cash award--in light of
Walinski's mistakes on the Johanson case. She suggested that
it was given for the rating period August 26, 1993 through
March 31, 1994--``before the problem arose over the Johanson
gun case.''
Charters' explanation is not supported by the facts. The
facts cited below clearly indicate that DCIS management was
aware of the complaints about Walinski's report at least
three weeks before Walinski received the cash award:
--The rating period for which the cash award was given
included the date--March 2, 1994--on which Walinski conducted
interviews of agents that were later characterized as false,
misleading and inaccurate in rank and file complaints to
management;
--Management claims that Walinski was transferred from
internal affairs into training on July 3, 1994 as a
disciplinary measure for the mistakes he made in the Johanson
case. This indicates that management knew about the
allegations prior to that date;
--Walinski admitted that he received a reprimand for making
``administrative errors'' in his report on the Johanson case
while still assigned to internal affairs--or prior to July 3,
1999;
--Clark informed DCIS management, beginning on July 6,
1994, that Walinski's March 2, 1994 interview of Clark was
completely false;
The facts show that the $1,200.00 cash award given to
Walinski on July 24, 1994 came at least three weeks after
DCIS management had knowledge that Walinski had falsified
reports on the Johanson case.
Reprimand
The staff was never able to locate the letter of reprimand
that was placed in Walinski's file, nor was the staff able to
establish the exact date on which the reprimand was given.
During an interview on July 12, 1999, Walinski's immediate
supervisor, Tom Bonnar, stated that he was ``furious'' with
Walinski about the Johanson interview statements. He said
Walinski ``was verbally and officially reprimanded and a
letter was placed in his file.'' Bonnar doubted the reprimand
would still be in his personnel file, since it's customary to
remove them after a brief period of time.
[See Attachment 17, page 2]
On September 8, 1999, Walinski confirmed that Bonnar had
indeed ``handed him'' a ``letter of caution'' for making
``administrative errors'' on the Johanson case, but he could
not remember if he kept it for 30, 60, or 90 days. In a
telephone conversation on August 2, 1999, Walinski claimed
that ``Bonnar told him to destroy it in the shredder after 30
days.''
Walinski also seemed somewhat confused about the actual
date of the reprimand. Initially, he suggested that it was
dated October 12, 1994. However when it was pointed out that
date was the exact day Bonnar and Hollingsworth approved his
last performance evaluation for internal affairs, he
suggested that October 12, 1994 might have seen the day he
destroyed the letter of reprimand. Mr. Walinski seemed
certain of one fact: he received the reprimand while still in
internal
[[Page S13655]]
affairs. This statement is consistent with statements by
Charters and Mancuso that the reprimand was issued before
July 3, 1994.
[See Attachment 15, page 2]
Walinski's Rebuttal
Walinski has a simple explanation for the inaccuracies in
his report of investigation on the Johanson stolen gun case.
His explanation was given during testimony to McClelland on
February 14, 1997 and confirmed in a telephone conversation
on August 2, 1999.
He claims it was a clerical error. In a nutshell, this is
his explanation:
``The headers got switched. The wrong headers ended up on
the Form 1 interview sheet. I said that one guy said one
thing when I said another guy said another thing. This
happened when the interviews got typed up. We had a secretary
that wasn't a top quality individual. She typed them up
wrong. . . . But it was my mistake.''
[See Attachment 18, interview, 2/14/97, pages 74-75, and
telephone interview 8/2/99]
During an interview on September 8, 1999, Walinski offered
a similar explanation:
``It was an administrative error. I roughed out the form 1
interview reports on my computer and gave my write up to a
secretary. The secretary got the headers mixed up and
switched some paragraphs.''
[See Attachment 15, page 2]
Walinski's explanation is highly questionable for two
reasons: 1) if the Clark interview never took place--as Clark
stated, then how could Clark's name end up on a Form 1
``header'' that was only inadvertently ``switched''? Clark's
name not should not have appeared on the radar screen; And 2)
Both Young and Shiohama contend that portions of their
interviews were true and accurate. If portions of the Young
and Shiohama interviews were true and accurate, then how
could the incorrect portions of their interviews involved
``switched headers''?
Furthermore, Walinski states that he prepared his write-ups
of the interviews on a computer and transferred them to a
clerk typist to be finalized. That being the case, a mix up
of headers seems improbable.
Walinski rule
Following the Johanson investigation, DCIS management
instituted investigative reforms, including the so-called
``Walinski rule.'' Under this rule, all interviews have to be
recorded and transcripts reviewed and verified by witnesses.
Management Backs Up Walinski
During an official DOD IG interview by McClelland on March
13, 1997, both Dupree and Mancuso attempted to diminish the
significance of the allegations that Walinski had falsified
his reports on the Johanson case. They seemed to accept the
`'wrong headers'' excuse used by Walinski.
McClelland questioned Dupree on March 13, 1997 about
``Walinski's ability as an investigator'' and problems with
regard to ``factual inaccuracies'' in his reports. During the
course of that interview, Dupree offered Walinski's ``wrong
header'' excuse. This is what Dupree said:
``Matt's [Walinski] probably one of the most capable
investigators I know. It wasn't factual inaccuracies. It was
in the deliberation of putting a lot of statements together.
Unfortunately, some of the comments that were made by
individuals were transposed to other individuals. The
statements and the facts were absolutely correct. They were
just attributed to the wrong person.''
[See Attachment 18, interview, 3/13/97, pages 45-46]
During an interview on March 13, 1997, McClelland asked
Mancuso if he ever got ``any word from Bill Dupree about
inaccuracies in the report of investigation that Walinski
prepared.'' Although McClelland appeared to be asking about
the Steakley report, Mancuso's response seems to address the
Johanson case. Mancuso also accepted the ``switched headers''
excuse:
``No. Again, I'm a little bit fuzzy because we had one or
two instances where Matt [Walinski] on different cases which
were in the same area, where Matt had inaccurately attributed
certain remarks--had confused witnesses' names in his notes.
But I don't recall any inaccuracies involving Steakley. . . .
Gary [Steakley] was saying Walinski's responsible for other
cases that are now suspect because of inaccuracies. . . .''
[See Attachment 18, interview, 3/13/97, pages 25-46]
Management's Knowledge of Allegations
The testimony given by Dupree and Mancuso to McClelland on
March 13, 1997 clearly indicates that senior management at
DCIS was aware of the allegations about Walinski's falsified
report on the Johanson case.
Rank and file complaints about Walinski's false and
misleading reports went right to the top at Headquarters as
follows:
--On July 19, 1994, Agent Clark signed a sworn statement,
alleging that Walinski had falsified his report [based on
complaints received from Johanson on July 6, 1994]; Clark's
statement was ``solicited'' and witnessed by Bonnar, the
Assistant Director of Internal Affairs and Walinski's
immediate supervisor; A document indicates that DCIS
headquarters was aware of this complaint on or about July 8,
1994;
--On August 4, 1994, ASAC Young in the Los Angeles Field
Office formally complained to Hollingsworth about Walinski's
false and inaccurate reports of interview with agents Young,
Clark, and Shiohama; Young reports that rank and file agents
are ``finding fault with management for not taking some type
of action to have this situation re-evaluated;''
Hollingsworth forwarded Young's formal complaint to Mancuso's
Deputy, Dupree;
--On August 8, 1994, FLEOA addressed a formal complaint to
Dupree, alleging that Walinski falsified his report of
investigation;
--On August 10, 1994, management launched a re-
investigation of the Johanson case based on rank and file
complaints about Walinski's reports;
Mancuso's Knowledge of Allegations
Mancuso's broad responsibilities for internal
investigations suggest that he would have been informed
immediately of rank and file complaints about the integrity
of an ongoing inquiry. Testimony and statements indicate that
Mancuso was kept up-to-date on the progress of all ongoing
internal investigations. Mancuso's responsibilities as DCIS
Director--and the DCIS person chiefly responsible ``for
staffing and direction for the conduct of internal
investigations''--meant that he would have been informed
about the controversy over the Walinski report on the
Johanson case and would have been involved in the decision to
re-investigate the case and reassign Walinski to Charters'
office.
During an interview on September 14, 1999, Mancuso was
questioned about his knowledge and awareness of the
allegations about Walinski's reports. This is what Mancuso
said:
Mancuso admitted that he knew about ``the problems of
Walinski's reporting'' on the Johanson case back in 1994, but
he contends that he was unaware of the allegations that
Walinski had fabricated the Clark interview in its entirety
``until a few weeks ago'' or in August 1999.
Mancuso said that Walinski was given a reprimand and
transferred [in July 1994] because of rank and file
complaints, of which he was aware, about the credibility of
the work being performed by the internal affairs office. He
said the ``transfer and reprimand were the culmination of
several negative reports on Walinski.'' As a result of these
complaints, policy changes--like the need to record and
verify interviews--were put in place--and the Johanson case
was re-investigated.
Mancuso insisted that he ``did not know about the extent of
Walinski's mistakes.'' He claims that as DCIS Director, he
normally ``did not get beyond that level of detail,'' though
he admitted he got deeply involved with the Steakley case
because of the lack of progress in the investigation.
[See attachment 19, page 1]
Decision to Re-Open Case
The directive that re-opened the Johanson case was dated
September 23, 1994. This memo suggests that DCIS managers
were aware of rank and file complaints about Walinski's
report.
The memo states that the Johanson case was re-opened
``after allegations of discrepancies were made concerning the
original interviews.'' It also states that Charters and
Hollingsworth directed the assigned agent [Schroeder] ``to
conduct an independent inquiry concerning the circumstances
surrounding'' Johanson's stolen firearm.
[See attachment 7]
Legal Questions about Walinski's Reports
There seems to be a consensus within DCIS that Walinski's
reports on the Steakley and Johanson were ``inaccurate.''
DCIS thinking seems to suggest that Walinski's reports might
have carelessly deviated from the facts, or he may have
misinterpreted a statement. He was just mistaken or careless.
Or as Walinski put it, he just made ``administrative
errors.''
During an interview on July 12, 1999, Bonnar characterized
Walinski's reports this way:
``The statements in Walinski's reports were inaccurate and
not falsified.''
[See attachment 17, page 2]
Mr. John Kennan, the current Director of DCIS, was
interviewed on August 4, 1999. He indicated that he was well
aware of all the adverse information on Walinski's reports in
August 1994, but he attempted to minimize the significance of
the problem. He said those reports were not a concern
because:
``Walinski's inaccurate reports did not affect the outcome
of the investigation.''
McClelland offered a similar view in an interview with OSC
on November 5, 1997:
``Walinski had been inconsistent and inaccurate in his
report on the tax issue (regarding Gianino's testimony) but
that it was not harmful. Walinski was just a sloppy
investigator.''
[See Attachment 20]
The staff believes that Walinski's reports of interview
with Gianino and Clark and his sworn testimony to McClelland
regarding these matters in 1997 went far beyond simple
factual inaccuracies. The staff believes that Walinski
invited or fabricated information contained in those reports
for the following reasons:
First, both Gianino and Clark deny that they were ever
interviewed by Walinski; they deny making the statements
attributed to them by Walinski; and both deny any knowledge
of the facts attributed to them by Walinski.
Second, it is possible to independently verify certain
inaccuracies in Walinski's reports.
--In Gianino's case, Walinski stated ``very shortly after
her [Gianino's] discussions with Steakley she became very ill
and was off
[[Page S13656]]
work for an extended period of time.'' Walinski later
explained that ``she had cancer really bad, ovarian cancer.''
Gianino's official leave records clearly indicate that she
had no ``extended illness'' as reported by Walinski. In fact,
she was shocked when told that Walinski had testified in
1997--under oath--that she had ovarian cancer. She stated:
``That statement is not true.''
--In Clark's case, Walinski stated that Clark had made
statements, which Clark said he never made, at a meeting,
which Clark said he never attended. Clark's appointment
calendar shows that he did not attend the meeting at the DCIS
office identified by Walinski. Instead, he spent that entire
day at another DCIS office with two other supervisory
agents--Young and Smith--who both subsequently confirmed that
fact.
DCIS officials also contend that even if Walinski's reports
contained false information, that information was ``not
harmful.'' For example, what difference does it make if
Gianino did not have an ``extended illness' as reported by
Walinski. They argued that the questionable facts generated
by Walinski did not affect the outcome of the investigation.
The level of danger or harm caused by a false statement is
not a valid standard for determining whether the law was
violated.
Under the law--18 USC 1001--a person who deliberately makes
false statements could be convicted of a felony and sent to
prison for up to five years. The law does not make exceptions
for the extent of damage or harm caused by a false statement.
In fact, a court decision specifically suggests the false
statements need not involve loss or damage to the government
[U.S. v. Fern, C.A. 11 (Fla.) 1983, 696 F.2d 1269].
Furthermore, the staff would argue that Walinski's false
reports did, in fact, cause damage.
First, Walinski's reports undermined the integrity and
credibility of the investigative process at DCIS--the Defense
Department's criminal investigative arm.
Second, Walinski's reports damage the reputations of two
fellow agents--Steakley and Johanson. Walinski's false
reports formed the foundation for charges that were
eventually made against both individuals. According to
Steakley, those reports caused Steakley and Johanson and
their families to incur considerable legal expenses and
mental anguish.
Other Cases
During the course of the inquiry into the Steakley and
Johanson cases, the majority Staff received allegations from
a current and a former DCIS agent that Walinski had falsified
reports during two other internal investigations, but the
staff was unable to investigate and substantiate those
allegations.
Conclusion
Based on a thorough review of all documents bearing on the
Steakley and Johanson cases, it is crystal clear that senior
DCIS management, including Mancuso, were aware of the
allegations about Walinski's witness reports. Although
management made certain administrative adjustments in the
wake of rank and file complaints about Walinski's reports,
management never attempted to determine if those allegations
had merit. Management never attempted to reconcile Walinski's
reports with the facts. Independent interviews of Gianino and
Clark would have quickly established the fact that Walinski
had fabricated at least two witness interviews. This very
simple step would have led to appropriate corrective action.
Instead, the record shows that Walinski was never
disciplined. In fact, the record shows that Walinski actually
was given a cash award--at least three weeks after management
began receiving rank and file complaints about the accuracy
of his reports.
Stealkey Case--Attachments
(1) Report of Investigation--Administrative Inquiry 91, May
1993, with witness interviews and other documents
(2) McClelland interviews located in Subcommittee and OSC
files; Testimony dates and pages cited; Including tape
transcriptions
(3) Letter from Steakley's tax attorney, John T. Ambrose,
February 22, 1994
(4) Recommendation of the Administrative Review Board on
Steakley case, March 7, 1994
(5) Notice of Proposed Suspension, Memo from Keenan to
Steakley, August 4, 1994
(6) Final Decision on Proposed Suspension, Memo from Dupree
to Steakley, October 25, 1994
(7) Letter from Steakley's attorney, Luciano A. Cerasi, to
Dupree, Received by DCIS ON September 15, 1994
(8) Memo from Bonnar to Hollingsworth on telephone call
from Steakley, November 15, 1994
(9) Letters from Steakley to DOD IG Eleanor Hill and
Senator Fred Thompson, March 9 & 12, 1996
(10) Exchange of letters between DOD IG Hill and
President's Council on Integrity & Efficiency, May 23, 1996
and October 16, 1996; Hill's letter to Sen. Thompson, May 23,
1996; Hill's memo to PCIE, February 20, 1997; OSC letter to
Hill, June 3, 1997; IC letter to PCIE, January 8, 1999
(11) Investigative Plan Into Allegations by William G.
Steakley, March 27, 1996
(12) Gianino's official leave records for 1991-1993
(13) Memo of interview with Gianino, June 30, 1999
(14) Memo of interview with Walinski, September 8, 1999
(15) OSC Report on Steakley case, No. MA-97-1477, July 21,
1999--Located in Subcommittee files]
(16) Hollingsworth memo for the record, November 23, 1994
Johanson Cast--Attachments
(1) Report of Investigation--Administrative Inquiry 108,
April 15, 1994, including witness interviews and other
documents
(2) Recommendation of the Administrative Review Board on
the Johnson case, May 9, 1994
(3) Notice of Proposed Suspension, Memo from Smith to
Johnson, June 24, 1994; acknowledged and signed by Johnson on
July 6, 1994
(4) Formal Statement ``signed and sworn'' jointly by Clark
and Bonnar, July 19, 1994
(5) Memo from Bonnar to Dupree and Hollingsworth, dated
August 9, 1994 transmitting Young's signed statement, dated
August 4, 1994, to Johnson
(6) Letter from Johnson's attorney, Luciano A. Cerasi, to
Dupree, August 8, 1994
(7) Case Re-Initiation, Memo signed by SA Timothy L.
Schroeder, September 23, 1994
(8) Notice of Proposed Suspension, Memo from Smith to
Johanson, November 23, 1994
(9) Amendment to Final Decision on Proposed Suspension,
Memo from Dupree to Johnson, February 9, 1995
(10) Employee Performance Rating, IG Form 1400.430-2 for 8/
26/93 thru 3/31/94
(11) Incentive Award Nomination and Action, IG Form
1400.430-3, for 8/26/93 thru 3/31/94
(12) Notification of Personnel Action, Form 50-B, Special
Act or Service Award, 5/2/93
(13) Employee Performance Rating, IG FORM 1400.430-2, for
4/1/94 thru 7/2/94
(14) Notification of Personnel Action, Form 50-B,
Reassignment, 7/3/94
(15) Memo of interview with Walinski, September 8, 1999
(16) Notification of Personnel Action, Form 50-B,
Performance Award, 7/24/94
(17) Memo of interview with Bonnar, July 12, 1999
(18) McClelland interviews located in Subcommittee and OSC
files combined with Subcommittee interview on August 2, 1999
(19) Memo of interview with Mancuso, September 14, 1999
(20) OSC (Shea) interview, November 5, 1997
____
Inspector General,
Department of Defense,
Arlington, VA, October 1, 1999.
Hon. Charles E. Grassley,
Chairman, Subcommittee on Administrative Oversight and the
Courts, Committee on the Judiciary, United States Senate,
Washington, DC.
Dear Mr. Chairman: I am writing regarding the inquiry of
your Subcommittee into certain personnel cases in the Defense
Criminal Investigative Service (DCIS). Your letter of
September 27, 1999, invited the Office of Inspector General
(OIG) to provide a written response based on my interview by
your staff on September 14, 1999. I understand that this
response will be attached to any final report that you may
issue.
In your letter you state that I was allowed the opportunity
to review the factual findings of your staff. I respectfully
disagree with that assertion. I have not been given an
opportunity to review any written work product, nor did your
staff orally share any draft findings. Rather, our meeting
consisted of an interview in which I responded to a lengthy
series of questions. In light of these facts, the OIG would
again request the opportunity to review your final written
report and provide comments prior to its release.
During my nine-year tenure as Director, DCIS, I supervised
approximately 500 investigative personnel at any given time
and the conduct of nearly 10,000 defense fraud
investigations. I have devoted my life to public service and
have proudly served for over 27 years. I am committed to
integrity in leadership within the Inspector General
community and proud of my investigative and management
record.
Given my limited understanding of the scope of the inquiry
of your Subcommittee, I will in this letter attempt to
furnish you with further insight as to the matters in
question. My objective in this matter is to provide you with
the information you need to accurately assess these cases.
Specifically, I will address actions with respect to the
handling of DCIS internal review matters involving Special
Agents (SA) Hollingsworth, Steakley and Walinski.
SA Larry Hollingsworth: SA Hollingsworth was employed by
the DCIS from November 1983 until his retirement in September
1996. I first met SA Hollingsworth some time after his hiring
during which time we were peers, I as Special Agent in Charge
(SAC) of the New York Field Office and he as SAC of the
Chicago Field Office.
In July 1995, I identified a photograph in a law
enforcement journal as possibly that of SA Hollingsworth. The
unidentified individual was being sought by the Department of
State (DoS) relative to the filing of a false passport
application. I immediately contacted the DoS and reported my
suspicions to them and later assisted the DoS in arranging a
surveillance of SA Hollingsworth in anticipation of a search
of his home. Following the search, he was immediately barred
from the worksite and kept from any active service with this
organization. Although he was arrested in July 1995, he was
not indicted until January 1996. During those seven months,
while the DoS investigation was ongoing, SA Hollingsworth was
allowed to use sick leave to the extent verifiable by
[[Page S13657]]
medical authorities and accumulated annual leave. Subsequent
to his indictment, he was suspended without pay and denied
further use of leave. He entered a conditional guilty plea in
March 1996 and was sentenced in June 1996.
During this time period I was involved in a variety of
administrative matters in which SA Hollingsworth contested
actions proposed by his supervisor. I, as Director, DCIS, at
the time was his second level supervisor and acted as
deciding official in each of these matters. These
administrative actions were separate and distinct from the
investigation by the DoS and prosecution by the Department of
Justice.
My next involvement with this matter began when SA
Hollingsworth appealed a Notice of Proposed Removal issued by
his supervisor. On August 23, 1996, his attorney requested an
extension until September 13, 1996, to file a written
response and notified us of his intent to make a subsequent
oral presentation. As deciding official, I granted this
request consistent with past DCIS practice and, to
preclude further delay, I simultaneously scheduled the
oral presentation for September 23, 1996. However, four
days prior to his scheduled oral presentation, SA
Hollingsworth retired.
SA Hollingsworth was provided the same due process afforded
to all other DCIS special agents in the form of a review by
the Special Agents Administrative Review Board and reasonable
time to prepare a written and oral response to a Notice of
Proposed Removal. Variation from past practice would have
been unwarranted and inconsistent with my experience as a
deciding official in dozens of disciplinary proceedings.
SA Hollingsworth's criminal conduct was both inexcusable
and inexplicable. His violation of law was totally out of
character and inconsistent with his job performance and
lengthy career. I noted this same observation in a letter to
the sentencing judge as I went on record describing SA
Hollingsworth's job performance.
Throughout this process, the OIG was provided advice by
personnel and legal experts. The course of action taken in
this case was one of the several available options permitted
by Federal personnel guidelines.
SA Gary Steakley: SA Steakley began his employment with
DCIS in December 1987. From that time until he entered the
Worker's Compensation program in February 1993 as a result of
a traffic accident involving a Government vehicle, he worked
in a variety of positions within DCIS. As Director, DCIS, I
selected him for several positions and promoted him to his
last job as manager of a DCIS investigative office in
California.
Subsequent to his vehicle accident, SA Steakley was the
subject of several adverse personnel and disciplinary
actions. With the exception of ensuring that internal reviews
proceeded in due course, my actions with respect to SA
Steakley were taken as the deciding official in these cases.
In addition, as Director, I proposed to involuntarily
transfer him in order to ``backfill'' his management billet
after his accident. In this case, the then Deputy Inspector
General acted as deciding official.
SA Steakley was treated fairly by DCIS, although he has
repeatedly alleged that he was subjected to prohibited
personnel practices. His allegations have been reviewed in
various venues, including the Office of Special Counsel who,
in December 1998, closed their file and declined to pursue
the case further.
SA Matthew Walinski: SA Walinski held a variety of
positions in DCIS from his initial hiring in August 1987,
until his transfer to the Office of Inspector General,
Department of the Treasury, earlier this year. Your staff has
questioned the accuracy of several reports of interview
prepared by SA Walinski to include a report dealing with SA
Steakley. It is my understanding that your staff perceives
that allegations concerning SA Walinski were not pursued with
the same tenacity shown in the SA Steakley investigations.
I was not aware of many of the facts alleged in this matter
until reviewing documents in response to the inquiry of your
Subcommittee. I did, however, have a general concern at the
time regarding the handling of internal investigations. As a
result, I directed that the internal review process be
restructured so as to ensure that all future interviews be
taped and transcribed to preclude any further dispute as to
reporting. I was also appraised by my deputy that SA Walinski
was being transferred from his duties to a position in the
DCIS Training Branch. It is my understanding that SA Walinski
received a downgraded appraisal as a result of his poor
performance as well as a written letter cautioning him as to
the importance of accuracy in his reporting.
In closing, I hope that my insights have provided you the
information you need to accurately assess these cases. I
appreciate your assurance that this letter will be included
in any report that may be issued on this topic and look
forward to an opportunity to review your draft report.
Sincerely,
Donald Mancuso,
Acting Inspector General.
Mr. GRASSLEY. Mr. President, I think it is imperative that Congress
continue to send the strongest possible signal only that the highest
standards and integrity are acceptable among our law enforcement and
watchdog communities, the more we will ensure that outcome. I yield the
floor.
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