Report: USAID probed for alleged bid-rigging

Investigators are looking into allegations that the top lawyer for the State Department's aid agency rigged a bid and that top officials tried to cover it up, according to The Associated Press.

The AP reported Thursday that the Justice Department and the U.S. Agency for International Development's inspector general are investigating whether USAID general counsel Lisa Gomer interfered last year to guarantee that a now-canceled bid for a “senior government-to-government assistance adviser” would be won by the agency's retiring chief financial officer, David Ostermeyer. Investigators with the IG's office are also probing whether Deputy Administrator Donald Steinberg tried to interfere with the internal investigation, the AP reported — possibly at the behest of USAID Administrator Rajiv Shah.

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“One document said Steinberg told inspector general officials that the agency's top administrator, Shah, asked him to speak with the internal investigators about the review,” the AP reported. “Steinberg, according to another inspector general document, ripped into the independent watchdog.”

A senior USAID official however denied that Steinberg was under investigation.

“We take very seriously the independence of the Inspector General and the importance of the Agency’s cooperation with Inspector General audits and investigations," USAID spokesman Kamyl Bazbaz told The Hill. "It is standard procedure for the Inspector General to brief with senior leadership of the Agency regarding its ongoing investigations and audits. The Investigation was conducted unimpeded and we cooperated with the investigation. The Agency supports the important role that the USAID Inspector General plays to combat waste, fraud and abuse by conducting investigations and audits of Agency operations.”

The chairmen of the House Oversight Committee and its national security subpanel, Reps. Darrell Issa (R-Calif.) and Jason Chaffetz (R-Utah), are also investigating the allegations.

“This interference by the top USAID official and his deputy in a corruption investigation of other top officials is disturbing and outrageous,” Issa said in a statement. “Inspectors general can only be effective if they are independent. Efforts to intimidate or chastise an inspector general for investigating agency corruption and submitting findings to the Justice Department are simply incompatible with honest government.”

The investigation could fuel calls by some lawmakers to cut foreign aid, a contentious issue that has come up during Sen. John Kerry's (D-Mass.) confirmation hearing as secretary of State Thursday.

This post was updated at 10:20 p.m. with comment from USAID