oversight

Administrative Investigation of an Anonymous Hotline Complaint Alleging Use of FHFA Vehicles and FHFA Employees in a Manner Inconsistent with Law and Regulation

Published by the Federal Housing Finance Agency, Office of Inspector General on 2016-12-06.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                REDACTED




Administrative Investigation of an
  Anonymous Hotline Complaint
Alleging Use of FHFA Vehicles and
  FHFA Employees in a Manner
    Inconsistent with Law and
            Regulation




 OIG Report • OIG-2017-001 • December 6, 2016
                         OFFICE OF INSPECTOR GENERAL
                                 Federal Housing Finance Agency
                             400 7th Street SW, Washington, DC 20219

                                       December 6, 2016


Federal Housing Finance Agency
400 7th Street SW
Washington, DC 20219

Re: Hotline Complaint

Dear

The Federal Housing Finance Agency (FHFA) Offi ce of Inspector General (OIG) conducted an
administrative investigation of an anonymous hotline complaint alleging that
tasked FHFA employees to drive your wife on personal errands including shopping trips, and
tasked subordinate FHFA employees to make personaJ traveJ arrangements for your wife.

The administrative investigation conducted by FHFA-OIG included: collection and review of
relevant laws, regulations, Agency policies, emai]s and calendar entries of certain FHFA
employees maintained on the Agency's email server, daily calendar entries for -           , and
airline reservations for -          and family members; and interviews of ten current or former
Agency employees, some more than once. FHF A provided all documents that we requested and
all FHF A employees whom we interviewed were candid and cooperated fully with us.


Summary of Findings

Our findings, which we discuss in detail below, based on the evidence obtained during our
administrative investigation, are:

   1. Information obtained during our administrative investigation did not substantiate the
      allegation that -           tasked FHFA employees to drive his wife on personal errands,
      including shopping trips from Janua1y 1, 2014, through August 31, 2016 (Review
      Period). We found no evidence during the Review Period that:                  wife was
      tran~             FHFA employee in an FHFA vehicle to mo personal errands; and/or



       -·
      that ~             wife rode in an FHFA vehicle when she was not in the company o.


   2. ln the course of our inquiry into the first allegation of th e anonymous hotline complaint,
       we found evidence of 57 dates on which FHF A emp loyees were scheduled to transport
      -             to or from airports for personal travel. The FHFA employee with primary
       responsibility for transporting-             recalled to us that some of the travel
                     Administrative Investigation - In Re     la
 scheduled for these dates was cancelled but estimated that he drov              to or
 from airports on about 50 of those occasions. Because FHFA employees did not
maintain usage logs for the leased vehicle used to transport -           , we were unable
 to determine with certainty the actual number of times that FHFA employees transported
-            · We found that this use of an FHP A leased vehicle was inconsistent with the
 applicable statute, 31 U.S.C. 1344       im lementin re lations, and FHFA's Vehicle
Use Policy, approved by                                      in June 2011.

We found that -              was advised by
and other Agency officials shortly after he joined FHFA that the
provide
         , including transportation to airports and that           accepted the use of an
FHP A vehicle and driver to transport him to and from airports in connection with his
personal travel. Based on our review of the evidence obtained during this administrative
investigation, we found that -             relied on- - and other Agency
officials, with long-standing government experience, to ensure that his transportation in
FHFA vehicles was appropriate. We found no evidence that -                 knew that the
Agency's provision of this transportation du1ing the Review Period was inconsistent with
federal law.

During our administrative investigation, we Jearned that FHFA's Office of General
Counsel (OGC) prepared a memorandum for- - in February 2012
(February 2012 OGC Memo) that explained in detail the statutory and regulatory
requirements for home-to-work transportation. We did not determine whether -
. . received or reviewed this memorandum. Other FHFA officials res onsible for
providing transportation to                                                     , told us that
they: were not aware of this February 2012 OGC Memo; lacked knowledge about the
governing statutory and regulatory requirements; and believed that they were following
the Vehicle Use Policy when they authorized or provided home-to-work and office-to-
airport transportation to -             as a safety precaution. None of these employees
sought guidance from FHFA 's OGC until after March 2016, when certain of them
became aware of the OlG's administrative investigation. Even after FHFA senior
officials were made aware that                   use of FHFA transportation to and from
area airports in connection with his personal travel was inconsistent with the Vehicle Use
Policy, FHFA continued to provide this transportation through the end of the Review
Period.
                    reported to us that, in March 2016, he provided a copy of the Vehicle
                            and spoke with him to ensure that he understood that policy
                                                  recalled that -          stated that he
was aware of that policy and was following it. We found no evidence that, as of the end
of the Review Period (August 31, 2016), -                was aware of the statutory and
regulatory requirements governing use of an FHFA vehicle or knew that the Vehicle Use
Policy failed to track those requirements.

We also found that FHF A employees maintained no usage logs for those vehicles used by
                                         that were not leased from the General



                                          2
                            Administrative Investigation - In Re 111111

        Services Administration (GSA) in contravention of31 U.S.C. § 1344(f). These
        employees reported that they believed that usage logs were not required for such vehicles.

    3. With respect to the second allegation in the anonymous hotline complaint, we found that
       -             tasked subordinate FHFA employees on 28 occasions to research and/or
       book 52 airline flights for his or his family members ' personal travel. We further
       determined that                tasked subordinate FHFA employees to research or book
       airline flights for               wife on three occasions when she accompanied him on
       official travel. Pursuant to 5 C.F.R. § 2635.102(b), we sought the opinion ofFHFA's
       Designated Agency Ethics Official (DAEO) regarding whether                      use of
       subordinate employees to research and/or make airline reservations for
       personal and/or family member travel were "required in the perfonnance of official duties
       or authorized in accordance with law or regulation" under the Standards of Ethical
       Conduct for Employees of the Executive Branch. The DAEO opined, in writing, that the
       researching and/or booking of airline reservations for personal travel by -            or
       his family by subordinate FHF A employees were not "requiTed in the perfonnance of
       official duties or authorized in accordance with law or regulation" as contemplated under
       5 C.F .R. § 263 5. 705(b), and that "no procedures authorizing such actions exist in FHFA
       policies, supplemental ethics regulation or law."


DiscussiQn of Findings

No Evidence Found to Substantiate Allegation of Personal Use of an FHFA Vehicle by.
-        Spouse

As discussed more fully below, 31 U.S.C. § 1344, Passenger Carrier Use (Section 1344), and its
implementing regulations, authorize federal agencies to provide transportation for official
purposes. The anonymous hotline complaint alleged that-                 tasked FHFA employees
to drive his wife on personal errands including shopping trips. Our review of electronic and hard
copy documents, including emails and calendar ent1ies, and our interviews of Agency
employees, including               , found no evidence to substantiate this allegation and found no
evidence that                wife was transported by an FHFA employee in an FHFA vehicle to
run personal errands.


-         Use of an FHFA Vehicle for Transportation To and From Airports in
Connection with Personal Travel Is Inconsistent with Section 1344 and Implementing
Regulations

In the course of our administrative investigation of the allegations in the anonymous hotline
complaint, we found evidence of 57 dates on which FHFA employees were scheduled to
transport -            to or from airports for personal travel during the Review Period. The
FHFA employee with primary responsibility for transporting -                 recalled to us that
some of the travel scheduled for these dates was cancelled but estimated that he drove .




                                                  3
                                Administrative Investigation - In Re 11111

-        to or from airports on about 50 of those occasions. 1 Because FHFA employees did not
maintain usage logs for the leased vehicle used to transport -           , we were unable to
 determine with certainty the actual number of times that FHFA employees transported .
-        to and from airports in connection with personal travel during the Review Period.

 For 56 of these 57 dates, FHFA documents show that FHFA employees were scheduled to
transport               in a vehicle leased by FHF A to or from area airports in connection with his
personal travel to                  . The FHFA employee primarily respons1ble for transporting
              reported to us that he customarily picked up                 at FHFA headquarters,
 stopped at                apartment in                      for               to pick up his bags or a
 computer, and then drove-               to an area airport for his flight to                 . For the
return trips, he reported that he typically picked up                at an area airport and dropped off
-             at his apartment -          , at               request. For one of the 57 dates, we
identified that an FHFA employee traveled to PbiJadel hia International Airport to pick up .
-         on his return from a personal trip to

Section 1344 and its implementing regulations set forth the circumstances in which Federal
agencies, including non-appropriated agencies such as FHFA, are authorized to use funds,
obtained by appropriation or otherwise, for the maintenance, operation or repair of any passenger
vehicle used to provide transportation for official purposes. 2 Section I344(g) and its
implementing regulation, 41 C.F.R. § 102-34.210, authorize the bead of a Federal agency to use
a government vehicle to transport an agency officer or employee between the place of
employment and a mass transit facility, provided that certain condi6ons are met. Those
conditions include:

     •   Detennfoation in writing, by the head of a Federal agency, in his or her sole discretion,
         that transportation in an agency vehicle from the place of employment to a mass transit
         facility is appropriate and consistent with sound budget policy, which is valid for one
         year;
    •    No safe and reliable commercial or duplicative Federal mass transportation service exists
         that serves the same route on a regular basis;
    •    Such transportation is made available, space provided, to other Federal employees;
    •    Alternative fuel vehicles should be used to the maximum extent practicable;
    •    Transportation should be provided in a manner that does not result in any additional gross
         income for Federal income tax purposes; and
    •    Ridership levels must be frequently monitored to ensure the cost/benefit of providing and
         maintaining this transportation.

We found that none of these conditions were met here.




1 Two  other FHFA employees served as back-up drivers when
back-up drivers each reported to us that they dropped off or picked up              at local airports on several
occasions; however, they did not know whether those trips were for personal or official travel.
2
  Our review focused ontwo specific authorizations in this statute, 31 U .S.C. § 1344(b)(9), authorization for home-
to-work, and 31 U.S.C. § 1344(g), authorization for office-to-mass transportation facility.


                                                          4
                           Administrative Investigation - In Re 111111

Based on the facts Jean1ed during our administrative investigation, we found that
                FHF A employees to provide both                               and
with n:ansportation in FHFA vehicles, and that such transportation was inconsistent with Section
 1344. Based on our review of these facts, we determined that-               relied on -
-          and other Agency ofiicials, with long-standing government experience, to ensure that
his transportation in FHF A vehicles was appropriate. As we now show, the Agency did not
obtain the necessary detenninations to provide home-to-work transportation under 31 U.S.C. §
 1344(b)(9), or to provide office-to-mass transit traosportation under 31 U.S.C. § 1344(g).

                                 ortal" trans ortation for

During the first half of 2012,                             began receiving death threats by
telephone, email, and social media regarding FHFA decisions relative to the housing market.

Section 1344(b)(9) authoiizes federal agencies to provide home-to-work transportation when the
head of that agency determines " that highly unusual circumstances present a clear and present
danger, that an emergency exists, or that other compelling operational considerations make such
transportation essential to the conduct of official business." Implementing regulations, 41 C.F .R.
Part I 02-5, define the terms ·'clear and present danger" to mean:

        [H]ighly unusual circumstances that present a threat to the physical safety of the
        employee or their property when the danger is: (1) Real; and (2) Immediate or imminent,
        not merely potential; and (3) The use of a Government (vehicle] would provide
        protection not othe.rwise available.

Any determinations made under 31 U .S.C. § 1344(b)(9) and implementing regulations, 41 C.F.R.
Part 102-5, must:

    •   Be made solely by the head of the agency and be in writing (31 U.S.C. §§ 1344(d)(l),
        (3); 41 C.F.R. § § I02-5.40, 102-5.55);
    •   Identify the name and title of the affected employee, the reason for the home-to-work
        authorization, and the expected duration of the transpo1tation (3 l U.S.C. § 1344(d)(l);
        41 C.F.R. § 102-5.120);
    •   Be limited to 15 calendar days, which can be extended for unlimited 90-day periods
        upon a finding by the head of the agency that the circumstances giving rise to a "clear
        and present danger" are continuing (31 U.S.C. §§ 1344(b)(9), (d)(2); 41 C.F.R. § 102-
        5.65);
    •   Be reported to chairs of Senate and House oversight committees no later than 60
        calendar days after the first detennination and subsequent detenninations may be
        consolidated into a single report and submitted quarterly (31 U.S.C. § 1344(d)(4); 41
        C.F.R. §§ 102-5. l l 0, 102-5.J 15); and
    •   Be documented with usage logs or other records to verify that the home-to-work
        transportation was for the authorized purpose. (3 1 U.S.C. § 1344(£); 41 C.F.R. § l 02-
        5.120).




                                                 5
                               Administrative Investigation - In Re 111111

ln February 2012, FHFA 's OGC prepared a memorandum for                            in which it
addressed whether the death threats received by                                  could constitute
the predicate ''highly unusual circumstances" needed for home-to-work transportation.3 The
2012 OGC Memo accurately exp]ajned the statutory and regulatory r equ irements for home-to-
work transportation. We did not determine whether                 rec eived or reviewed it. The
Vehicle Use Policy, adopted in June 2 011 and signed b                                    is
summary in nature and omits a number of requir ements set forth in 31 U.S.C. § 1344 and its
implementing regulations. 4

Io light of the threats received by                                , the Agency retained Lennon
Secmity Corporation (Lennon) to perform an executive threat and risk assessment and report on
its findings. In its written report provided to F HFA (Le1111on Report) in September 2012, Lennon
found:                             had been the focus of many newspaper and internet articles due
to FHFA decisions regarding the housing market; FHFA's increased efforts were expected to
create a period of tension in tbe housing industry; and that                       and his family
"continue to receive very serious threats from various sources." The Lennon Report
recommended th at FHFA provide security fo                                "in and around the
workplace, when traveling on organizational business and at his residence." It identified some of
the requirements for home-to-work transpo11ation pursuant to 31 U.S.C. § J 344(b)(9) that the
2012 OGC Memo had explained, and recommended that FHFA provide
with "portal-to-po1tal" transportation (without defining the locations covered by that
recommendation), an additional security driver, and a security-trained escor t.

After receiving the find ings and recommendations in the Lennon Report,
determined that the death threats received by                               warranted FHFA
transportation, even though the statute makes clear that such a detennination cannot b e
                               According to FHFA's
                    directed her to provide portal -to-portal transportation to
                      as well as                          informed us that they thought FHFA
                               initial decision to provide security-related transportation
                      > bul neither could fi nd that written docum entation. Witnesses reported to
us that FHF A provided FHFA transportation to                                 for security reasons
                                                                                                    t-
from September 20 12 until                                          . Because no v~                s
were kept for these trips, we were unable to detennine whether FHF A provided . . . . . . . .
-        with office-to-airport transportation for his personal travel during this period. 5

We formd no evidence that FHFA employees complied with the statutory or regulatory
requirements when providing the previously described transportation to

3 When this administra6ve investigation began, the individual identified as
                                and
  Among other things, the Vehicle Use Policy lacks any requirement that the Agency notify CongressionaJ oversight
committees, keep Yehicle logs to verify that home-to-work transportation is for an authorized purpose, or make
periodic written determinations of a ·'clear and present danger'' when providing its employees with home-to-work
transportation beyond the ori inal 15-dav eriod.
5 Employees in FHFA 's                                   old us they believed tha~                      uired for
vehicles that were not leased from the G SA and the vehicle reserved for use by. . . . . . . . . . . was not
leased from GSA.


                                                        6
                                Administrative Investigation - In Re -




2. Authorization of home-to-work and office-to-ai]J)ort transportation for-

The Lennon Report assumed that the threats received by
                            nd recommended that the Agency "strategize appropriate decisions as
to which vulnerabilities should be addressed first in order to mitigate the most erilous threats
and vulnerabilities to                                 ." Shortly after            joined FHFA
                                                                                rovided




-           reported to us that she was unaware of any specific threats to                        and
explained that FHF A kept the same security precautions in place for                           because it was
not sure that the threats were over.                                        advised us that he was unaware of
any threats against                                                                            6


 At the onboarding briefing, -            stated that be did not believe he needed security for his
 home-to-work commute, and declined FHFA's offer to provide regular home-to-work
 transportation. We found no evidence that -              accepted home-to-work transportation,
 other than a handful of trips from his home to early morning meetings outside FHF A on housing-
related matters, and one instance in which                                    insisted on driving
-             home after building security raised concerns about an individual who appeared at
the FHFA seeking to speak with -               .

                              recalled that during the same onboarcling briefing,
                                    informed -               that he would be trans orted from FHF A
lo mass transportation facilities for security reasons, and that                              should
accompany him into transportation hubs. It appears to us that FHFA employees mistakenly
substituted th e "clear and present danger" predicate for home-to-work transportation, pursuant to
31 U.S.C. § 1344(b)(9) , for the predicate requirements for office-to-mass transit facilities
pursuant to 31 U.S.C. § 1344(g).                   recalled to us that he had a "robusf' discussion
with                       at that briefing regarding his personal security and that he was left with
the impression that FHFA had a "serious preoccupation~                           ased on our review of
the evidence, we detennined that-                 relied on -                    and other Agency
officials, with long-standing government experience, to ensure that bis transportation in FHFA
vehicles was appropriate.                   reported to us that he thought the recommendation by




6
 -             reported to us that, during his tenure, there were two episodes which posed a
security involving protestors




                                                          7
                                 Administrative Investigation - In Re           11111
                        that                                   travel with him and/or escorr him into an
    airport was excessive and did not accept it.

We found no evidence that -               (or anyone else at FHFA) made a written determination
that he faced a "clear and present danger" that warranted FHFA to provide -               with
home-to-work transportation. 8 It appears to us that FHF A employees mistakenly substituted the
" clear and present danger" predicate for home-to-work transportation, pursuant to 3 1 U.S.C. §
1344(b)(9), for the predicate requirements in 31 U.S.C. § 1344(g) for office-to-mass transit
facilities. Nonetheless, we found no evidence that FHP A complied with the statutory and
regulatory requirements for home-to-work transportation, discussed above, when it provided
office-to-airport transportation for -           . Similarly, we found no evidence that the
Agency complied with tbe statutory and regulatory requirements for o~              ort
transportation outlined above when it provided such transportation to ~             in connection
with his personal travel.

                 was placed on administrative leave                 and                  was
 appointed and continues to serve in that position. Prior to learning of tbe OI~            ion into
this matter in March 2016,                    was aware that FHF A provided - - with a
government vehicle and a driver, but did not know that FHFA employees regularly drove .
-         to and from area airports in FHFA vehicles in conoection with h~                vel or
whether FHFA provided home-to-work transportation for -                  . ~ reported
                                                                          9

to us that she thought that her office was properly fo llowing FHFA's Vehicle Use Policy when it
provided an FHFA vebic]e to transport                 to ancl from area airports in connection with
his personal travel. We determined that the         mistakenly believed that concerns about
potential security threats to -           would justify use of an FHF A leased vehicle for such
transportation under tbe Agency' s Vehicle Use Policy.

                        and ~     separately reported to us that each was unaware of the statutory
a,n d regulatory requirements for providing F HF A transportation to Agency employees, and were
not aware of the February 2012 OGC Memo that detailed the legal requirements for providing
transportation to                          .-            stated that she presumed that the Vehicle
Use Policy was valid, and                    stated that he did not know that the Vehicle Use
Policy conflicted with the statutory and regulatory requirements. However                       did
not seek an opinion from OGC on the legal requirements for providing transportation to Agency
employees.

7 Subsequently,   FHFA conducted security assessments on
-         that resulted in additional security measures. ln
  ecunty than
8                 stated that she did not know whether-               had made the requisite written determination,
pursuant to 31 U.S.C. § l 344(b )(9), at any time that a "clear and present danger" existed to warrant home-to-work
transportation and reported that she was not aware that anyone else at FHF A determined, in writing, that a " clear and
present danger'' existed to support home-to-work transportation.
9                    reported Lo us that he first learned that FHF A was transporting-             to and from area
airports in March 2016. After learning about that practice.                    reviewed the Vehicle Use Policy and
asked -           whether that practice complied with the po ·cy.             informed him that mFA was affording
the same transportation to                                                      and that it was operating under an
exception to lhe policy.



                                                          8
                                Administrative Investigation - In Re 111111



 In March 2016,                           and                           became aware of OIG's
 investigation.                         reported to us that he reviewed FHFA's VebicJe Use Policy
 after he learned of OIG 's investigation and acknowledged that FHFA's transportation of.
-          to and from area airpo1is in connection with his personal trave] was not authorized
 under the office-to-mass transit facility provisions in that olicy. 10                 informed
us, however, that he had no reason to b elieve that                would have known that the
Vehicle Use Policy was inconsistent with federal law when                ~       ted FHFA
transportation to and from airports for his p ersonal travel. Likewise, . . . . reported that she
had no reason to believe that -               had any knowledge of the applicable regulatory
requirements.

                                  reported to us that, in March 2016, he provided a copy of the
                                   and spoke with him to ensure that he understood that policy
and followed it.                                    recalled that            stated that he was
aware of that po~                 wing it. To ensure compliance,
-        advised~                 that FHFA should adhere to the Vehicle Use Policy and should
not grant any waivers until the OIG investigation concluded.

 From March 2016 through August 31, 2016, the end of the Review Period, FHFA continued to
 transport -            to and from area airports in connection with his personal travel. •
-         reported to us that he interpreted FHF A's Vehicle Use Policy to permit him to use
 FHF A transportation to and from area airports in connection with his personal travel. •
-         stated that he understood that                       had approved an exception to the
Vehicle Use Policy                                     and had verball authorized office-to-airport
transportation for                                   uring the                   onboarding
 briefing. According lo                                      likely would have reduced his verbal
authorization to a written exception to the Vehicle Use Policy, had he remained in his position.
               asse1ied to us that the airport transportation provided to him by FHF A is
appropriate because he regularly works on FHF A business in the vehicle on the way to and from
 the airport. While -             may, at some future point jo time, make the detenninations
required by 31 U.S.C. § 1344(g) and its implementing regulations, he has not yet done so.

We recognize that the Ethics Reform Act of 1989, as amended, revised 31 U.S.C. § 1344 to
permit heads of agencies to "prescribe by rule appropriate conditions for the incidental use, for
other than official business, of vehicles owned or leased by the Government." Pub. L. 101-194,
title V, § 503, Nov. 30, 1989, 103 Stat. 1755, as amended by Pub. L. 101 -280, § 6(b), May 4,
1990, 104 Stat. 160. FHFA bas not promulgated such a rule.

Through our review ofFHFA documents and our interviews ofFHFA employees1 we learned
that -                  mpanied him several times in an FHFA vehicle to and from area
airp~ d -                use of an FHF A vehicle to and from area airports been consistent


                                                drafted an exception to the Agenc Polic to warrant FHF A
                                          informed us that she did not eak to               about this proposed
exception.                   provided lhe draft determination to                             for review but was
advised to "stand down" 10 avoid any interference with the OIG administrative investigation.


                                                         9
                                  Administrative Investigation - In Re •

with the requirements of 31 U.S.C. § 1344(g),                spouse may have been able to
accompany him, jf FHFA had issued a rule permitting such use pursuant to the Ethics Reform
Act of 1989, as amended. However, Section 4.0(K) of the Agency's Vehicle Use Policy is more
restrictive than the implementing regulations for Section 1344 and does not permit non-FHFA
employees to be transported with an FHFA employee, unless the passenger was or is conducting
business with FHF A. 11

We recognize that the GSA regulations implementing Section 1344 define "official use'' as
"using a Government motor vehicle to perform your agency·s mission(s), as authorized by your
agency." 12 Because the GSA re&,ulations place the obligation to determine "offi.cial use" on the
Agency, we leave to FHFA the determination of whether the transportation of-                 in
FHFA vehicles in the manner described above was an "officiaJ use." Should the Agency
conclude that such use was not "official", it must identify and take necessary actions arising out
of the use ofFHFA employees to drive -                to or from airports in FHFA vehicles for the
57 scheduled trips described above, of which 18 appeared to occur after regtllar business hours or
on weekends, and may have resulted in FHFA incurring costs for employee overtime or
compensatory time. 13


-         Use of Subordinates to Research and/or Book Personal T1·avel Reservations Is
Inconsistent witb Standards of Ethical Conduct

The anonymous hotline complaint alleged that -                 tasked subordinate FHFA employees
with making personal travel arrangements for his wife. Based on our review of FHFA employee
emails and interviews of FHFA employees~ we found that -                  tasked subordinate FHPA
employees (Employee A and Employee B) on 28 occasions to research and/or book 52 airline
flights for his or his fam ily members' personal travel. On 27 of the 28 occasions, FHFA
employees made reservatjons for -               to travel on 50 flights between
                      . On 2 of these 27 occasions, an FHFA employee also made reservations for
                wife to accompany him                      . On the 28th occasion, an FHFA
employee researched and/or made roundtrip reservations - compris-
wife and one for                 -                 for a family trip to-

Employee A began booking persona] travel for-                shortly after-           joined
 FHFA. Employee A could not recall whether-                 ftrst asked Employee A to book his
personal travel or whether Employee A volunteered to do it for him. Employee A reported to us
that he/she found it unusual to be asked to book personal trips for -         ' and told .
-        that he/she did not mind booking                personal travel even though Employee


11 During   the course of our administrative investigation, we learned that ~                 wife were transported
in an FHFA vehicle to a funeral at Arlington National Cemetery, and thereafte-                 spouse was dropped
off in Georgetown and -               continued to an officiaJ meeting at the U.S. Treasury.
12 4 1 C.F.R. 102-34 .200, entitled Official U5e ofGovernment Motor Vehicles.
13 For example, we found that -               was picked up from Philadelphia International Airport on his return from
a personal trip by an FHFA employee in an FHFA leased vehicle and driven back to Washington, D .C. ona Sunday,
for which the Agency approved 9. 15 hours in overtime for the driver who provided that transportation.




                                                            10
                                 Administrative Investigation - In Re 111111

 A thought be/she was not supposed to do so. 14 Employee A was tasked by -           on 16
 occasions to research and/or book 31 flights for-         and/or his family. On 15 of these
  16 occasions, Employee A researched and/or booked 29 fl ights for -          to travel between
                                       . On l of these 15 occasions, Employee A also made a
  reservation for             wife to accompany him                    . On the 16th occ~
  Employee A researched. and/or booked round                                   wife and - -
-         or travel between               and

 Employee B was tasked by                    on 12 occasions to research or book 2 1 fl ights for .
                   betwee                                           , using his frequent flyer
 infonnation and his persona] credit card. On 1 of these 12 occasions, Employee B also made a
 reservation for                  wife to accompany him                     . Employee B considered
 this task to be part of hjg/her job-related responsibilities.

 Regulations establishing the standards of ethical conduct for employees of the Executive Branch,
 5 C.F.R. § 2635.705(b), direct that " an employee shall not encourage, direct, coerce, or request a
 subordinate to use offida.1 time to perform activities other than those required in the performance
 of official duties or authorized in accordance with law or regulation." l11ese standards apply to
 FHFA employees. 16 Section 2635. 705(b) provides the following example as gu idance:

          An employee of the Depaiiment of Housing and Urban Development may not ask his
          secretary to type his personal correspondence during duty hours. Ftuiher, directing or
          coercing a subordinate to perform such activities during nonduty hours constitutes an
          1mproper use of public office for private gain in violation of2635.702(a).

Pursuant to 5 C.F.R. § 2635.705(b), we sought to determine whether                use of
subordinate FHFA employees to research and/or make personal airline reservations for .
-        his spouse, and fam ily members was "required in the perfonnance of officia l duties or
authorized in accordance with law or regulation." Because the conduct in issue involved .
               , we sought an opinion from the Agency's DAE0. 17 We asked the DAEO to
assume the fo)lowing facts as a predicate for his opinion:

      •   From March 7, 2014, tlu·ough July 27, 2016, at               request, subordinate FHFA
          employees researched and booked 27 airline reservations (amounting to 50 individual
          flights) for
          27 occasions. FHFA employees made accomp anying airline reservations
          ~            pouse.
                                                                                                 for.
                                   personal travel to and from various destinations. On 2 of those




 14
    Employee A also recalled asking                                        whether Employee A was required to make
 personal travel reservations for                and relayed to hi m that Employee A was uncomfortable making those
 reservations. Employee A remem ered that                                     respon~
 reservations for -              was nor part of Employee A's job responsibilities. . . . . . . . . . . . . . did
 not recall this conversation and was fairly certain that he would have recalled such a conversatjon had it occurred.
 15 Employee A also made reservations for-                   spouse to accompany him on offi cial travel.
 l6 5 C.F.R. § 9001.10 I , entitled Supplemental Standards of Ethical Conduct for Employees of the Federal Housing
 Finance Agency, provides that 5 C.F.R . Part 2635 applies to FHF A employees and requires them to comply with the
 standards enumerated in Part 2635 and other applicable ethics regulations.
 17 See 5 C.F.R. §§ 2635.102(b), 2638 .203(b)(12).




                                                          11
                           Administrative Investigation - In Re . .



    •    From March 13, 2014, through May 6, 2014, at                re~             nate
        FHF A employee researched flights for                spouse and ~            for
        personal travel. The FHFA employee ultimately booked an airline reservation for .
        -                        but did not book a reservation for            spouse.

    •   From March 7, 201 4, through November 5, 201 4, al                request, subordinate
        FHFA employees booked airline flights for three official trips made by -           and
        researched or booked airline flights for             spouse who accompanied him on
        that official travel.

On November 10, 2016, FI-IF A's DAEO issued an opinion finding that the researching and/or
booking of airline reservations for personal travel by -          or his family by subordinate
FHFA employees were not "required in the performance of official duties or authorized jn
accordance with law or regulation" as contemplated under 5 C.F.R. § 2635.705(b), and that "no
procedures authorizing such actions exist in FHF A policies, supplemental ethics regulation or
law."



                                                *******
 Based on the information learned during this review, we found that senior FHFA officials did not
 understand the requirements in Section 1344 and jts implementing regulations governing agency
 transportation of an employee. The Vehicle Use Policy, in force since June 2011, does not track
 the statutory and regulatory requirements and strict adherence lo thjs policy would not satisfy
 these requirements. FHFA employees, however, have operated outside of this policy for a
 ownber of years. Even after FHFA senior officials became aware in March 2016 that .
-           use of FHFA transportation to and from area airports in connection with his personal
travel was inconsistent with the Vehicle Use Policy, FHFA continued to provide this
 transportation. Last, FHFA' s DAEO found tha                    use of subordjnate FHFA
 employees to research and/or book airline reservations for personal travel was inconsistent with
 the standards of ethical conduct set forth in 5 C.F.R. § 2635.705(b).

We recommend that the Agency take the following immediate actions:

    1. Cease using FHFA vehicles and employees to provide transportation to Agency
       employees in a manner that is inconsistent with federal law and regulations;
    2. Cease using FHFA employees to research or book personal travel for -               or his
       family in contravention of 5 C.F.R. § 2635.?0S(b);
    3. Revise its Vehicle Use Policy to track the requirements of Section 1344 and
       implementing regulations;
    4. Maintain detailed usage logs for all leased vehicles;
    5. Train employees tasked with providing FHFA transportation to -               and other
       FHFA employees with the statutory and regulatory requirements;




                                                12
                          Administrative Investigation - In .Re . . .

   6. Adopt appropriate internal controls to ensure that the findings required by Section 1344
      are made by the appropriate Agency employee, are documented in writing, and that
      requisite notices are provided; and
   7. Retain all documentation relating to provision of transportation under Section 1344.

We are providing a copy of this letter memorandum to the Office of the White House Counsel,
appropriate Congressional oversight committees, the U .S. Office of Government Ethics, and the
FHFADAEO.

Respectfully,


,t..;f?t1t,,~
Laura S. Wertheimer
Inspector General




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