VA Leader Resigns Over Lavish Conference Spending

A senior Department of Veterans Affairs official has resigned following the release Sept. 30 of an Inspector General's report that blasted the VA for leadership failure and ethical violations following lavish VA conferences at a Florida resort last year where employees took gifts from contractors.

John Sepulveda, the VA's assistant secretary for human resources, resigned over the weekend following the release of the IG's report. It's unclear if he will be the only official punished. VA officials said the agency will look into the actions of other officials linked to the conferences last July and August.

Sepulveda's official biography was removed from the VA's website by Monday. He told Federal Times he "did not want to be a distraction for the administration."

Sepulveda is hit in the IG report for failures in leadership, but is also alleged to have made a false statement to investigators about a video created for the conference.

In a statement issued Oct. 1, the VA's Inspector General's office noted "significant failures by VA and VA employees on three fronts" in planning and carrying out the conferences at the Marriott World Center in Orlando in July and August 2011. The IG estimated costs at about $6.1 million.

In addition to the costs of the conferences, the IG found that employees accepted gifts that included alcohol, gift baskets, tickets to see the Rockettes, spa treatments, stretch limo transportation and even helicopter rides.

"Beyond the individual ethical lapses, which cast all federal employees in a bad light, the management failures resulted in unnecessary costs and unauthorized commitments that diminished these legitimate training events," the IG wrote.

The IG cited a pair of 8-minute videos in which an actor portraying Army Gen. George Patton laid out the role of VA human resources personnel and exhorted employees to meet their mission. The videos cost about $52,000 to produce. The IG said Sepulveda's claim that he had not viewed the videos before they were shown at the conferences was false.

Rep. Jeff Miller, R-Fla., chairman of the House Veterans Affairs Committee, said in a statement Monday the IG's final report shows that the VA's senior leaders "took no action to stem excessive conferences costs, and in fact, endorsed and approved costs without proper oversight."

Miller said Congress has tried repeatedly to get the VA to pull back on its conference costs, but obviously to no avail. He blasted the agency's bookkeeping as "funny money accounting."

The VA said today it concurred with the IG findings and said the actions detailed by investigators "represent serious lapses in oversight, judgment, and stewardship."

The IG identified a number of VA employees in its findings, though the names of most were stricken from the redacted version of the report available to the public. The VA on Monday said that Secretary Eric Shinseki will appoint senior officials to review evidence of wrongdoing and to recommend appropriate administrative action. The agency said two employees already have been placed on administrative leave pending review.

The IG identified three officials by name in the report as having improperly accepted gifts from contractors wanting to do business with the VA or already doing business with the agency. The three identified individuals are Arthur McMahan, deputy dean of the V.A. Learning University, which supports the agency's training programs and policies, Jolisa Dudley, executive assistant to the Deputy Assistant Secretary for the Office of Human Resources Management; and Thomas Barritt, special assistant to the Deputy Assistant Secretary for the Office of Human Resources Management.

In its final report, the IG states that the VA spent $6.1 million on the conferences, $1 million more than what the VA previously said.

It also found that contract violations and lack of oversight led to illegal or wasteful expenditures, that some employees used their government purchase cards inappropriately, and that the agency spent about $98,000 on "unnecessary and wasteful" promotional items, including bags, pens, water bottles, and exercise bands.

"It is blatantly clear that VA does not know how much it spends on conferences," Miller said today.