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Archive for Saturday, July 19, 2014

Federal agencies probe alleged contracting corruption in Kansas Army National Guard

July 19, 2014

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— The Kansas Adjutant General's office confirmed this week that federal authorities are investigating allegations of corruption involving the Kansas Army National Guard's contracts with outside medical companies.

“We can't speak to specifics, except to say we were made aware of concerns of inappropriate conduct related to our medical contracts and we have referred the matter to federal authorities for further investigation,” Sharon Watson, spokeswoman for the Kansas Adjutant General's office, said in an email Friday.

Her statement came in response to questions from the Journal-World involving allegations that a captain in the Guard's Medical Detachment has received gifts, including meals and ski trips, from officials with Dentrust, a Pennsylvania company that performs dental screenings and treatment for Guard soldiers.

The captain is a designated Contracting Officer Representative, or COR, which means he has no input into the awarding of contracts, but is responsible for helping to oversee them and ensuring compliance with their terms.

Dentrust is one of three outside firms that contract with the Kansas Army National Guard for those services. In federal fiscal years 2012-2013, the company received more than $585,000 under those contracts.

Furthermore, one person has alleged that Dentrust and Guard officials attempted to quash a separate sexual harassment complaint involving a female Dentrust employee who was allegedly assaulted by an Army National Guard soldier earlier this year in order to protect their interests in the contract.

The people who spoke to the Journal-World include one former Guard officer and one current soldier in the Medical Detachment. Both asked not to be identified because they are involved in ongoing investigations. Both said they have been interviewed by multiple federal agencies, including the FBI, Defense Criminal Investigative Service and the federal National Guard Bureau.

The most recent interviews occurred last weekend, July 11, when NGB's Office of Complex Investigations interviewed at least three current Army National Guard soldiers about the sexual assault allegations, one of the people said.

Dentrust officials did not respond to requests for comment on this story.

Outside medical contracts

National Guard systems throughout the country routinely contract with medical providers for health screenings and treatment so soldiers can be cleared for their weekend duty, annual training and other kinds of active service. Those contractors supplement the Guard's own medical staff.

Before 2012, the Kansas Army National Guard contracted with one firm, Salina-based Compass Medical Provider, LLC.

But Watson said that in 2012, the Army National Guard decided to contract out for more medical services in an effort to meet U.S. Army readiness standards.

“While we do have doctors and other medical staff, we do not have enough medical personnel in the Guard to meet those standards,” Watson said.

That year, according to records, the National Guard hired two additional companies, Dentrust and ACC Health, LLC, of Albuquerque, N.M.

In federal fiscal year 2013, the most recent year for which numbers are available, the Kansas Army National Guard spent $972,000 on contracted medical services, more than triple what it had spent in fiscal year 2011, with Dentrust receiving more than half of that amount.

As a result, Watson said, Kansas rose from being in the middle of the pack to 13th in the nation in terms of readiness among the 54 state and territorial National Guard systems.

The contracts expired at the end of fiscal year 2013 but have been continuing while the Guard reviewed bids for new contracts. Late last week, the Guard awarded new, five-year contracts to four companies, but officials could not disclose the names of those firms until all of them had been notified.

Questions about favoritism

Records show that as time went on, Compass began to get a smaller and smaller share of the work. Kim Coad, who founded the company in 2009, said she didn't understand why her Kansas-based small business was losing out.

“My company has always provided a higher quality of care,” Coad said. “I was never left with the impression that I did anything below quality. I don't understand why I have lost business.”

She said all of the dentists who practice with her company are licensed in Kansas and provide treatment services in local dental offices.

However, the former guard officer said concerns about favoritism toward Dentrust, and suspicions about providing gifts and meals to National Guard officers, began emerging as far back as the summer and fall of 2013.

The former officer said those concerns were relayed up the chain of command, and to the FBI, before that officer resigned from the guard that fall.

But in March, the allegations were raised more directly, this time in connection with alleged sexual harassment against a female Dentrust employee.

Sexual harassment claim

According to people who spoke to the Journal-World, as well as sworn statements and other documents given to investigators and obtained by the Journal-World, that issue arose during a training exercise in early March, when a civilian Dentrust employee reported to two officers that she had been sexually assaulted by a National Guard sergeant.

The woman reported the sergeant had also sexually assaulted her in February, and that he had been sending her text messages with “inappropriate content” for some time, according to documents.

The sergeant reportedly denied any wrongdoing, and the woman expressed concern that she could be fired if the information was reported because she had been told by company officials “not to do anything to jeopardize the (Medical Detachment) contract.”

Before long, however, the current guard soldier who spoke to the Journal-World said Dentrust was notified of the allegation. That person said a company official urged the alleged victim to cooperate with the COR about the assault complaint, even though the COR was reportedly not pursuing it, because the COR was giving the company information about the contracting probe.

According to a sworn statement obtained by the Journal-World, the COR allegedly said during one conversation that it was not unusual for a guard member to have the phone number of a civilian contractor because he kept phone numbers of a Dentrust employee whom he described as “a friend.”

According to that statement, the COR also said during that conversation that he had gone out to meals with a Dentrust employee and had received ski tickets from the employee. The conversation reportedly occurred shortly after the COR returned from such a ski trip.

Watson said the Adjutant General's office, which oversees both the Kansas Army and Air National Guards, could not comment on specific allegations of sexual assault or harassment.

“In the National Guard, per Department of Defense policy, in situations involving sexual harassment/assault cases, we refer to local law enforcement with jurisdiction, and if declined for investigation by local authorities, then we are required to refer cases to National Guard Bureau Office of Complex Investigations,” Watson said in an email.

State and federal ethics rules

National Guard systems often fall into a gray area between state and federal government because, strictly speaking, they are part of both. In Kansas, the governor is commander in chief of all state guard units, but those units are also governed the U.S. Department of Defense.

At both levels, though, there are strict prohibitions on employees accepting gifts from outside entities.

Under Kansas law, all officers and employees in the executive branch are prohibited from accepting “any gift, economic opportunity, loan, gratuity, special discount or service provided because of such person's official position” unless those items have an aggregate value of less than $40.

Department of Defense regulations also prohibit its employees from accepting gifts from any person or entity that “does or seeks to do business with the employee's agency.”

Watson said she could not comment on whether an ethics counselor had been consulted about the gifts, which would be standard practice under Army regulations.

"When requested, the (Judge Advocate General's) Office provides ethics opinions on gifts received by members of the Adjutant General's Department to make sure they are in compliance with Department of Defense and State of Kansas ethical guidelines," she said. "The JAG does not investigate the matter, but ensures any instances of misconduct are appropriately handled."

Comments

Ralph Reed 5 months ago

Somebody's going to jail.

Maybe multiple somebodies.

Kate Rogge 5 months ago

And look into Rock Chalk Park next, please?

Wayne Kerr 5 months ago

Kate, you beat me to it. That's exactly what I was thinking. It's as if our city in the last couple of years has been trying to compete with Chicago for most corrupt city government.

Dorothy Hoyt-Reed 5 months ago

We just have a mindset in the US now, that is "me, me, me". Cover you behind, never take credit for a mistake, and get everything you can get, legal or not, without getting caught. And if you have a lot of money, it won't matter if you get caught. This guy doesn't have a lot of money, so he is in big trouble. This attitude has always existed, but it is much more common and no longer frowned upon. Ask yourself, if someone gave you too much change, would you correct the clerk and give back the money? I'll bet few people nowadays would. I don't mean to be cynical, but this egotistical selfishness (redundant?) is destroying us in so many ways.

Richard Heckler 5 months ago

I would think no bid contracts would raise some eyebrows where tax dollar spending is involved.

Roy Hodges 5 months ago

I see no indication these were no bid contracts. Compass first received the contract under a bid process and became a sole contract provider. Later, the Guard chose three different providers, presumably under a bid process. I would suspect that broader service coverage and a lack of reliance on a single provider entered into this contract decision.

Compass should have known/assumed for business strategy purposes that they would receive less income as compared to when they were the sole service provider, simply because they were no longer a sole contract provider. Unfortunately, if the allegations are true, there was an unequal playing field created by the COR.

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