VA OIG: Waste and Abuse by the Former Assistant Secretary for Human Resources and Administration

“In July 2018, the VA Office of Inspector General (OIG) received allegations that Peter Shelby, while serving as VA’s Assistant Secretary for Human Resources and Administration (HR&A), had improperly steered a $5 million contract for leadership development and training services to a company owned by a friend. The allegations related to a contract awarded in February 2018 on a sole-source basis (i.e., without a competitive process) to a Service-Disabled Veteran-Owned Small Business (SDVOSB) (the Small Business).”

“The OIG investigated and substantiated that VA entered into a $5 million contract with the Small Business on a sole-source basis. The OIG also found that Mr. Shelby abused his position by violating ethics rules in order to cause VA to award a contract for the benefit of two friends. The contract at issue resulted in the waste of $5 million.”

“This report identifies the federal law, regulations, and VA policy that the OIG determined were not followed in the award of this contract. The OIG referred this matter for consideration by the U.S. Department of Justice, which declined to open an investigation. The report also addresses failures of VA employees to ensure that the contract award process complied with applicable requirements. This report makes eight recommendations for process improvements and consideration of administrative action with respect to the individuals involved in the award of the contract.”

  • “Finding 1: Mr. Shelby Misused His Official Position to Direct the Award of a $5 Million Contract for the Benefit of Two Friends
  • Finding 2: Use of VA’s Sole-Source Authority was Not Supported by an Adequate Justification as Required by VA Policy and the VA Acquisition Regulation (VAAR)
  • Finding 3: VA Wasted $5 Million on Services It Could Not Use”

Read the full 41-page report here.

Source: Waste and Abuse by the Former Assistant Secretary for Human Resources and Administration – July 8, 2020. VA OIG.

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