John Sepulveda is assistant secretary for human resources at Veterans Affairs. (Army Times)
John Sepulveda, former chief human capital officer at the Veterans Affairs Department, allegedly lied to investigators regarding his involvement in the production of a parody video shown at two expensive conferences last year, according to the department’s inspector general.
Sepulveda told investigators that he never saw the $50,000 videos parodying the war movie “Patton” before they were shown at two human resources training conferences last summer, according to the IG report.
“If somebody says that I saw videos ahead of time, no, I did not,” Sepulveda said, according to the IG report. “I didn’t even know there was going to be a Patton video.”
But other VA officials told IG investigators that Sepulveda was shown the videos during the conferences’ planning stage. Sepulveda “requested some minor changes he wanted made to the videos,” the report said.
Sepulveda resigned from VA on Sunday, one day before the IG report’s release. The IG said the Justice Department declined to prosecute Sepulveda for allegedly lying.
The IG concluded that Sepulveda’s lying about the Patton video was part of an effort to protect himself from fallout from the conference scandal.
“It is a fair inference that his efforts to distance himself from responsibility extended to making false statements under oath as to his knowledge of, and involvement in, the preparation of the Patton parody video,” the report said.
In an interview with Federal Times, Sepulveda strongly disputed the conclusion that he purposefully lied.
“It was an honest mistake,” Sepulveda said.
Sepulveda said he first found out on Sept. 21 that the IG had accused him of lying, and he submitted a sworn affidavit correcting the record Sept. 25.
“I was unfairly and unjustly accused by the IG of making a false statement because I did not accurately recall an event that occurred over a year ago, during my one and only interview with OIG staff on Aug. 16,” Sepulveda said.
In the affidavit, Sepulveda acknowledges watching the videos on July 7, 2011, but said he also attended several high-priority meetings — including a Capitol Hill briefing for Senate staffers — that day. He said he may have forgotten watching the Patton videos because he was primarily focused on those meetings.
The report also found that the Orlando, Fla., conferences cost at least $6.1 million — and possibly even more, since investigators were not sure all costs had been accounted for. VA put the final tally for the conferences at $5.2 million.
The IG said the conferences were for valid training purposes.
Investigators also questioned about $762,000 in “unauthorized, unnecessary, and/or wasteful spending” at the conferences, including:
Almost $281,000 in excessive spending for audiovisual services, catering, food, beverages and other miscellaneous expenses at the Orlando World Center Marriott.
More than $200,000 in unsupported expenses, including almost $154,000 in contractor travel that VA paid for.
$97,900 in unnecessary promotional items.
$43,000 in questionable awards paid to VA staff for their roles in managing these conferences. The IG questioned those awards in light of the mismanagement and lack of cost controls.
The IG also found 11 employees improperly accepted gifts from contractors while planning the conferences. Those gifts included meals, lodging, transportation, gift baskets, tickets to a Rockettes show, spa treatments and a helicopter ride.
Sepulveda told Federal Times that he stepped down because of the IG report.
“I resigned because I did not want to be a distraction for the administration, [VA] Secretary [Eric] Shinseki and the VA, especially as they continue to work each day to address the urgent needs of our nation’s veterans,” Sepulveda said. “I had the distinct honor of serving the president and the secretary, and as a result, I got a chance to play a role in their efforts to support our veterans, and I will forever be grateful for that opportunity.”
The report also concluded Sepulveda “abdicated his responsibilities when he failed to provide proper guidance and oversight to his senior executives in the operations of his organization.”
Sepulveda’s “performance was contrary to his statement in his memorandum to the [VA’s chief of staff, John Gingrich] wherein he asserted that ‘our planning committee is pursuing all efforts to constrain and control cost,’ ” the report said.
VA IG George Opfer said in a statement that he hopes the report will help VA improve its oversight of public funds for future events.
“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,” Opfer said.
In a statement, VA said Shinseki will appoint senior officials to review the evidence and recommend appropriate action against employees who may have broken rules. VA said two employees have already been placed on administrative leave, pending review.
According to the statement, Shinseki also told Gingrich that his review of the conferences was inadequate, and that he should have asked more questions before he authorized them.
James O’Neill, VA’s assistant inspector general for investigations, said in a conference call with reporters that one of the 11 employees who received gifts appeared to have solicited free lodging from a hotel. O’Neill said the IG referred that employee’s case to Justice, but said Justice has not decided whether to prosecute that employee.
House Veterans Affairs Committee Chairman Jeff Miller, R-Fla., in a statement said the report showed “a clear lack of leadership and accountability” in the management of taxpayer dollars.
“Senior leaders took no action to stem excessive conference costs, and in fact, endorsed and approved costs without proper oversight,” Miller said.
Miller also noted that the $762,000 in wasteful spending identified by the IG came close to the entire cost of the General Services Administration’s 2010 Western Regions Conference in Las Vegas, which cost $823,000.
And he criticized VA for being unable to accurately account for all of its conference expenses.
“It is blatantly clear that VA does not know how much it spends on conferences,” Miller said. “This sort of funny money accounting must stop, and it will no longer be tolerated, especially in today’s tight fiscal climate.”