Veteran Oversight Now

Fred Baker:
Welcome back to another podcast episode of Veteran Oversight Now. The official podcast of the VA Office of Inspector General. I'm your host, Fred Baker.

Each month on this podcast we’ll bring you highlights of the VA OIG’s recent oversight activities and interview key stakeholders in the office’s critical work for veterans.

Joining us today is Jane Muir. Jane is the director of the VA OIG's forensic Audit and Analysis Division. Welcome, Jane.

Jane Muir:
Thank you, Fred. Appreciate being here.

Fred Baker:
We're happy to have you.
Now, if you don't know what a forensic audit and analysis division is, that's OK. A lot of people don't. Here it's a nationwide group of very smart folks who provide direct support to our special agents in the field. I'll let Jane explain more, but before we get into the discussion on your division, Jane, I'd like to take just a minute to introduce you to the audience, so they know a little bit about who we're talking with. Tell me just a little bit about yourself. Where do you live, your family, your pets, hobbies, fun facts, anything that you'd like to share?

Jane Muir:
OK, thank you very much. Well, I have been in the federal government for almost 32 years. I've worked with several agencies. I started my federal career as a civilian accounting technician with the US Army in Heidelberg, Germany while I was backpacking through Europe after college. And to my surprise, I loved accounting. I received my graduate degree in accounting a few years later and worked in the federal accounting and financial management areas for several years with the FDA in Maryland and again the US Army overseas in Germany and the Peace Corps in DC. And then I pivoted to forensic auditing in the US Attorney's office in San Diego, California in 2005, working healthcare fraud cases. But then I moved to San Francisco, where I am now in 2013 performing federal drug pricing program reviews and grant reviews for the health resources and services administration of HHS.
But I was anxious to get back into investigative work, so I joined VA OIG in 2017 as a forensic audit manager in the Office of Investigations, and with my colleague, we grew the team and added needed structure in a completely virtual environment. And as of September 2020, I've been the director of the Forensic Audit and Analysis Division in the Office of investigations. Like I said, I live in San Francisco. It's a beautiful city to live. I feel very lucky to be here, and I love to travel and it's nice to be able to start doing that again. I just got back from Europe.

Fred Baker:
Thanks, Jane. Now, I've got to admit, I heard a lot of facts. I didn't hear a lot of fun facts. So, let's go back to the backpacking in Europe. So, say again how you got started working for the army. It almost sounded like you said, while you were backpacking across Europe.

Jane Muir:
Yes, that's true, I went to Europe trying to make my way to Berlin, Germany after I had studied history in college, and I needed some cash while I was traveling. And it was suggested to me to try and get a job on the US military base in Heidelberg while I was there and I sat in the library, and I hand wrote out the SF 171 when those were still a thing.

Fred Baker:
Right.

Jane Muir:
Yeah, and I got hired. I don't know—It might have been because I was my junior and senior class treasurer and in high school, but I got hired and that is how I started my federal career. And I ended up staying four years in Germany and traveling all over the place. Being able to work for the army allowed me to do that.

Fred Baker:
Did you make it to Berlin?

Jane Muir:
Well for visiting, but I ended up living in Heidelberg that whole time.

Fred Baker:
OK, so the intent was you wanted to go live in Berlin?

Jane Muir:
Yep, the intent was that I wanted to live in Berlin, and you never know how things are going take you. I was staying with the friend of a family—family of a friend of mine, and they're the ones that suggested, “Look, you need some cash. You need some money now. Try working for the Americans on the US military base.” And so, I did.

Fred Baker:
What was the draw to Berlin? Why did you want to live there?

Jane Muir:
Well, I studied European history in college, and I also minored in German.

Fred Baker:
Gotcha. And is there German heritage on your side?

Jane Muir:
Yeah, there is. But I had travelled there when I was 17, and I was very interested in the language, and I was interested in going back someday. So, that's why I studied it.

Fred Baker:
That sounds like a heck of a journey in a lot of different meanings.

Jane Muir:
I know. And now I’m an accountant. Who knew?

Fred Baker:
The path to accountant. OK, so now to the serious. Part tell us what a forensic auditor does versus a standard auditor.

Jane Muir:
OK. Well, forensic auditing. Forensics means something suitable for or used in courts of law. It requires high support standards that can withstand scrutiny in a court of law. In a criminal case, that means evidence beyond a reasonable doubt, which is the highest standard. And in a civil case, it's the preponderance of the evidence.
A forensic audit begins with an allegation of fraud or wrongdoing, and it's the examination of records to determine facts related to a fraud or wrongdoing allegation. The objective is to obtain relevant data and evidence, analyze them using sound methodologies and various systems to determine whether or not fraud was committed. The analysis is reviewed by the agents and the attorneys, and the attorney determines if the evidence meets fraud statute thresholds (to go forward with the case) [Only a judge or jury, not an attorney, can decide guilt or innocence].

And FA does not make statements to any guilt or innocence. We solely present the—excuse me—the forensic auditor doesn’t make statements to any guilt or innocence. We solely present the facts of the case.
The results of a forensic analysis can be litigation, restitution, forfeiture, civil settlement, an administrative referral, or no fraud found, or evidence that doesn't meet the beyond-a-reasonable-doubt or the preponderance-of-the-evidence thresholds.
Now, conversely, the objectives of performance audits, generally speaking, are to determine if financial statements are error free or fraud free, or to determine the effectiveness and efficacy of program oversight, and this results in an audit report and/or recommendations. Another key difference is that our auditors work cases independently for the life of the case. That's a lot of freedom to design one’s own review plan, as opposed to a team of auditors with a prescribed engagement plan, as you see in performance audits.

Fred Baker:
So, Jane, kind of give me a “day in the life.” When I say, “what do they do?”, literally, what do they do? What are they doing in a day-to-day type of environment?

Jane Muir:
OK, sure. First, let me say that we work all kinds of fraud cases. The VA has lots of benefits, so there's a lot of different types of fraud cases we work. And so, I'm just going to tell you a few of those, and that's going to tie into what it is that we do with those types of fraud cases.
Our FAs typically work contracting, particularly service disabled, veteran owned, small business contracting; construction and procurement fraud; education, grant, loan guarantee fraud; disability compensation and benefits healthcare, fiduciary fraud; theft of government funds and property; bribery; kickbacks; public corruption; money laundering; and embezzlement.
But we also work non fraud cases as well. We assisted with the Clarksburg Reta Mays homicide investigation with analyzing healthcare data, which showed who administered insulin and how much to the victim veterans and when to help determine red flags, corroborate existing evidence, and narrow down suspects and ultimately remove Mays quickly from her nursing aide duties to prevent further harm to patients. So that gives you an idea of like all the different types of cases we're working. So, when we get a case, what we do—the kind of reviews that we do when we get a case—is that we review financial records for fraud determination. We data mine and perform trend analysis. We assist with the financial components of an IG or grand jury subpoenas, search warrants or seizure warrants. We prepare financial profiles, including reviewing tax returns. We trace assets for forfeiture, and we review emails and documentation stored in digital organization systems, just to name a few.
So, you asked, like, what do we do on a day-to-day basis? I mean, it could be any one of these things depending on the case. And our folks have more than one case. Most of our folks are averaging about 6 cases.

Fred Baker:
Wow.

Jane Muir:
But in addition to performing the analysis, our FAs participate in prosecution team and task force meetings. We attend interviews, proffers, and reverse proffers. We participate in discovery. We prepare work product results and findings, provide presentations and briefings of results. We prepare trial exhibits and provide expert and fact witness testimony at grand jury or trial. So, we could be doing any of those things depending on the status of the case at the time.

Fred Baker:
Honestly it sounds like a pretty exciting job.

Jane Muir:
Well, I would definitely say it's an exciting job. You’ve got to like to solve puzzles. You know, that's the kind of mindset. And we also work with a lot of systems. So, we have a lot of systems that we employ to help us do our analysis. And so, we do a lot of work with external systems, but also a lot of VA internal systems. We have access to all that, and that's part of my job, is making sure that I can get the folks access to those systems that they need to get the data they need. But we do rely heavily on getting our data from our Office of Management and Administration Directorate in the Office of Data and Analytics.

Fred Baker:
So, that all does sound very exciting. Tell me about your division. You've mentioned that you and another built a team. Tell me what the makeup is, how long you've been a team and what does the team do as a team?

Jane Muir:
Sure, love to talk about the team. That's why I'm here today. I'm very proud of them.
We're a headquarters team because we service all special agents across the country. We are forensic auditors, forensic managers and we are all, including myself, spread out in field offices. None of us sit at headquarters actually, but we are a headquarters team. We have 11 forensic auditors and two forensic audit managers, and those managers manage two teams of forensic auditors. We have a West Coast team and an East Coast team.
And this is considerable growth from the forensic audit team’s humble beginnings in 2010 with just one forensic auditor. Our diverse team is composed of experienced auditing and accounting professionals with extensive investigative support backgrounds from various federal agencies and the private sector. All are certified fraud examiners. Some are CPAs and certified systems auditors. We also have an FA with a law degree. The forensic auditors bring a wealth of forensic auditing experience and a distinct skill set to their investigative teams, and the teams, at a minimum, include a case agent and usually a DOJ Assistant United States Attorney. And our forensic auditors provide direct support on many of the most complex and impactful investigations. You heard me mention the May’s case earlier. But our analysis tools, which I also mentioned earlier, allow us to take on smaller scope assignments and generate work product more quickly. It used to be that we only did the biggest cases, but we now have tools that allow us to do smaller cases, and that helps the agent get that work done faster, and it also allows for the agent to work on other aspects of the case.
Currently all of our forensic auditors are experienced GS 13s in the 511 auditor series. However, we want to tier those grades to include lower grades of GS 11 and 12s to expand our applicant pool, provide promotional potential, and establish a mentoring program.

Fred Baker:
So, speaking of cases, I want to talk about some cases. Then I want to talk about what it takes to become a forensic auditor for anyone listening who might be interested in that path. But first let's talk about some of the cases that you or your group has worked on.

Jane Muir:
OK. Would love to talk about that. So, these are all adjudicated cases. These are cases that are in the press. And I would like to start with the retail-ready education fraud, criminal case. We had a forensic auditor assigned to the case, which is a Dallas case, but the auditor was in Atlanta, and this was in 2017. And the forensic auditor provided analysis of bank records and data, which we received from our Office of Data and Analytics, and what it showed was an 85-15 rule violation. And what that means is that the funding for the foreign education institution cannot be more than 85% from the VA. But what the analysis showed is that approximately 98% of the for-profit trade schools funding came from the VA, which far exceeded the 85% rule. the analysis showed that most of the funds went directly to the school owner, not the school, and definitely not the veterans. And the total loss to the VA was over $72 million.
And then in April of 2021, the case went to trial. And we were brought back in only one month beforehand, just one month before trial, to perform additional analysis that DOJ wanted. Because our auditor was in Atlanta, and because of COVID, we had another auditor who was available in Dallas, worked together with our auditor in Atlanta and with the FBI's forensic accountant assigned to the case in order to prepare for trial. It was very fast paced. It was very stressful, but we got it done, and our forensic auditor in Dallas testified at trial to her own analysis, which she had to create. And she testified to the flow of VA funds at a weeklong criminal trial. The federal grand jury--excuse me--the federal jury found the school owner guilty of seven counts of wire fraud and four counts of money laundering. And the defendant was sentenced to over 19 years’ incarceration with three years’ supervised released and restitution of approximately 65.2 million. And it was the forensic auditor’s testimony and evidence that had significant impact on the verdict and sentencing in this case. So that was a very impactful case. Should I go on and talk about another one?

Fred Baker:
Yeah, let's talk about one more.

Jane Muir:
OK. We have another case with trial. We had the William Dorsey fiduciary fraud criminal trial, and one of our forensic audit managers, who was a forensic auditor at the time in DC, was assigned to this Atlanta case in 2019. The forensic analysis of subpoenaed bank records and the fiduciary file from VA showed that the defendant embezzled over $150,000 of VA benefits from his disabled veteran father, funds that were supposed to be spent on the veteran’s benefit. Our forensic auditor traveled to Georgia twice for trial preparation and testimony. He prepared over 40 exhibits for trial within one week showing the misuse of VA funds intended for the veteran's care, and he testified to work product and exhibits during a four-day trial, which yielded a guilty verdict. The defendant was sentenced to one year and one day incarceration, a year supervised release, and had to pay over $23,000 in restitution. And it's another great example of forensic auditing work significantly impacting a case result.

Fred Baker:
Yeah, it does. It sounds like it's very critical work on both sides of 1) fraud bringing money back to VA as well as 2) on the fiduciary side insuring the people who are deserving of those benefits receive those benefits. Those are great examples. Just quickly, tell me what it would what it takes—I know your trip was was backpacking through Europe and working for the army. That was your journey to become a forensic auditor. How would one now go about choosing that career path. What school, what experience would take him there.

Jane Muir:
OK, well. The only OPM requirement for most 510 accounting or 511 auditing GS series, is a minimum of 24 hours in accounting. That's standard. However, most of our forensic audit team has undergraduate and graduate degrees in accounting or accounting related fields. Some are CPAs, as I mentioned, all are certified fraud examiners. Both carry weight at trial, and particularly the certified fraud examiner is particularly weighty, when testifying to forensic work. So, we encourage anyone to get that certification.
For performance auditors looking to make the move to forensic auditing, the best advice I can give is take any opportunity to work with investigations, gaining an understanding of how cases move forward and how to work with and present findings to law enforcement is valuable experience. But, also the position requires real out -of-the-box thinking. Developing new ways to analyze data, and ability to work independently and be readily available to work with the investigative team because often there are sudden changes in timelines, requiring adaptability and flexibility. I will say that the work can often be slow and methodical, and all the work is to be prepared as if it will be seen at trial. Accuracy is paramount, but it's incredibly satisfying to identify key evidence of fraud and other crimes that can really help bolster an investigation, which is why anybody that I know that was in investigations and then ended up getting out of investigations, wants to get back into investigations and forensic auditing work because it is unique, and it is rewarding in ways that are not found in regular auditing. I'm not saying regular auditing isn't rewarding. It has its own rewards. But this is a different kind.

Fred Baker:
Great. Well, Jane, thanks for speaking with us today.

Jane Muir:
Thank you very much for having me.

Fred Baker:
Is there anything else you'd like to add before we sign off?

Jane Muir:
Oh well, no. Just, again thank you very much for the chance to be able to highlight our team. We're still growing, and we provide a lot of direct support to our investigative teams. It's always a team effort, but we're a real strong component, and it's great to highlight it today. So, thank you.

Fred Baker:
We appreciate you being here.

Fred Baker:
If you'd like to know more about the VA office of Inspector General and its oversight work, go to www.va.gov/OIG. And now I'll turn over the podcast to my co-host, Adam Roy, who brings you this month's oversight highlights. Take it, Adam.

Adam Roy:
Thanks, Fred.

Now I will highlight some of VA OIG’s work from June 2022.

On June 7, Mike Bowman, the director of information technology and security here at the VA OIG, testified before the House Veterans’ Affairs’ Subcommittee on Technology Modernization. This hearing focused on VA’s progress in implementing a cybersecurity program and how VA’s antiquated legacy systems are difficult to adapt to VA’s changing operational and security requirements. Mr. Bowman discussed the OIG’s annual Federal Information Security Modernization Act of 2014 audits, or FISMA audits. The most recent of which identified repeat findings and deficiencies related to configuration management, identity management and access, and contingency planning controls.
He also discussed the OIG’s IT security inspection program, which examines sites not evaluated under the annual FISMA audits, and how this and other ongoing oversight efforts can help spur progress, especially if OIG recommendations are proactively reviewed and implemented by IT leaders across the enterprise. A recording of the hearing is available on the committee website.
Then the next day, Mr. Bowman participated at a roundtable conducted by the Senate Veterans’ Affairs Committee that focused on VA’s efforts to bolster its cybersecurity posture and better protect veterans’ information. The roundtable also included Office of Information and Technology representatives and private sector healthcare company executives who spoke about their companies’ best practices.
You can find his written testimony on our website under the media tab. And we’ve included a link to the committee’s website in the monthly highlights if you’d like to watch a recording of the hearing.

Now for a few updates to investigations conducted by our special agents.

A physician was charged in connection with a healthcare fraud scheme. This multiagency investigation resulted in charges alleging that the physician entered into an improper agreement with a diagnostic imaging company through which he was paid bribes and kickbacks in exchange for ordering unnecessary transcranial doppler tests, which use sound waves to detect medical problems that affect blood flow in your brain. He received approximately $148,000 in kickbacks and may have billed government and private insurance companies as much as $3.25 million in unnecessary tests based on fraudulent diagnoses. The potential loss to VA is at least $650,000.

Now, here’s three updates to investigations related to the pandemic.

A business owner from Georgia pleaded guilty for his role in a fraud scheme involving COVID-19 and cancer genetic testing. He owned a marketing company that generated leads for medical testing companies. From 2019 to 2020, he provided testing companies with qualified patient leads for medically unnecessary cancer genetic screening tests in exchange for kickbacks of approximately $1,000 to $1,500 for each test that resulted in a reimbursement from Medicare. The business owner entered into a sham contract and utilized sham invoices to make it appear that he was being paid for legitimate services and to conceal his kickback scheme. In March 2020, he began receiving kickbacks on a per-test basis for COVID-19 tests, provided that these tests were bundled with a much more expensive respiratory pathogen panel test, which does not identify or treat COVID-19. He pleaded guilty in the District of New Jersey to conspiracy to violate the Anti-Kickback Statute and conspiracy to commit healthcare fraud. The loss to VA is approximately $330,000.

In a second case, a pharmaceutical executive was charged for allegedly conspiring to defraud at least a dozen VA medical centers by selling personal protective equipment at excessive prices—exceeding $300,000—during the pandemic. He was charged in the Southern District of Mississippi with conspiracy to defraud the United States. This investigation was conducted by the VA OIG, Food and Drug Administration Office of Criminal Investigations, and the FBI.

And lastly, a registered nurse at the VA medical center in Detroit, Michigan pleaded guilty for COVID-19 vaccination card fraud. She stole authentic COVID-19 vaccination record cards and the vaccine lot numbers necessary to make the cards appear legitimate. Then, she sold the cards and lot numbers for $150 to $200 each to individuals within the metro Detroit community. The VA OIG, Health and Human Services OIG, and VA Police Service investigated this case.

In another investigation, a veteran was charged with discharging a weapon on VA property. Allegedly, the veteran discharged a 12-gauge shotgun outside the Ravenna VA Clinic in Ohio. The defendant was near a flagpole in front of the clinic, and after being approached by a security guard, he allegedly displayed the shotgun and discharged a shell into the ground. The VA clinic and a nearby school and private hospital were immediately locked down. After discussions with a SWAT Team negotiator, the veteran ultimately surrendered and was later indicted for inducing panic and possession of criminal tools, with firearms specifications.

The VA OIG and Department of Housing and Urban Development OIG investigated a mortgage lender who has now agreed to pay over $1 million to resolve fraud allegations. The lender knowingly underwrote FHA mortgages and approved for insurance mortgages that did not meet FHA requirements or qualify for insurance, resulting in losses to the federal government when the borrowers defaulted on those mortgages. It was further alleged that the lender knowingly failed to perform required quality control reviews as well. VA paid over $1.2 million in claims for loans originated by this defendant.

And finally, a second nonveteran was found guilty for their role in a fraud scheme. Per the investigation, two nonveterans fraudulently created a service-disabled veteran-owned small business, then installed a service-disabled veteran as the apparent owner of the business. However, the business remained under their control. Over a period of 10 years, the business was awarded over $305 million in government contracts. Of this amount, approximately $77 million was awarded by VA, including a set-aside contract valued at $24 million to build a parking garage at the VA Long-Term Spinal Cord Injury Clinic in Dallas. The other nonveteran, as well as the veteran mentioned, previously pleaded guilty in connection with this investigation.

Read more about these cases and some of the other cases the VA OIG investigated in the June monthly highlights available on our website.

Now to published reports. In June, the VA OIG published 19 reports. I’ll highlight a few of them now.

We published the report titled Suicide Prevention Coordinators Need Improved Training, Guidance, and Oversight. As part of the Veterans Health Administration’s suicide prevention strategy, suicide prevention coordinators at VA medical facilities are required to reach out to veterans referred from the Veterans Crisis Line. Coordinators provide access to assessment, intervention, and effective care; encourage veterans to seek care, benefits, or other services with the VA system or in the community; and also follow up to connect veterans with appropriate care and services after the call. VHA’s Office of Mental Health and Suicide Prevention is responsible for issuing policy and guidance for managing crisis line referrals.

The VA OIG conducted a review to evaluate whether these coordinators properly managed crisis line referrals to ensure at-risk veterans were being reached. The review team found that coordinators mistakenly closed some veteran referrals because coordinators lacked the proper training, guidance, and oversight necessary to maximize chances of reaching at-risk veterans referred by the crisis line. VHA also lacked comprehensive performance metrics to assess coordinators’ management of crisis line referrals, and coordinators lacked clear guidance on how to manage crisis line referrals. Until VHA provides appropriate training, issues adequate guidance, and improves performance metrics, coordinators could miss opportunities to reach and assist at-risk veterans. We made five recommendations to the under secretary for health that include improving data integrity, training coordinators on using patient outcome codes, developing additional guidance, monitoring compliance with requirements to space calls over three days, and evaluating program data for additional opportunities to improve services for referred veterans.

I recently spoke with Corina Riba, who was part of the team that authored this report, on Inside Oversight, VA OIG’s other podcast. In the episode, Corina and I discuss this report in detail and break down her team’s findings. Find the Inside Oversight podcast wherever you listen to podcasts and on the VA OIG website.

Annually, the OIG reviews pharmaceutical proposals submitted to the VA National Acquisition Center for Federal Supply Schedule contracts valued at $5 million or more. Now, these reviews are not published because they contain sensitive commercial information protected from release under the Trade Secrets Act but the VA OIG summarizes its findings in an annual report titled A Summary of Preaward Reviews of VA Federal Supply Schedule Pharmaceutical Proposals Issued in Fiscal Year 2021. This report summarized 15 preaward reviews which had a cumulative 10-year estimated contract value of about $8.3 billion and included 846 offered drug items. The review team concluded that commercial disclosures were accurate, complete, and current for four of the 15 proposals reviewed. The remaining 11 proposals could not be reliably used for negotiations until the noted deficiencies were corrected. The OIG made recommendations for lower prices than offered for 10 of the 15 proposals, resulting in the Acquisition Center awarding contracts or modifications with cost savings of about $42.6 million.

The last report I’ll mention is related to the VA OIG’s ongoing oversight of the VA’s implementation of its new electronic health record system. The report is titled Deficits with Metrics Following Implementation of the New Electronic Health Record at the Mann-Grandstaff VA Medical Center in Spokane, Washington. Here, the OIG evaluated the availability and utilization of metrics more than a year after the Mann-Grandstaff VA Medical Center became the first VHA medical center to implement the new electronic health record system. With VA’s transition to the new system, metrics were created by syndicating new electronic health record data to the existing VA data repository and by using the new system’s functionality. The OIG found that facility gaps in available metrics due to the new system transition impaired the facility’s ability to measure and act on issues of organizational performance, quality and patient safety, and access to care. The OIG is concerned that further deployment of the new EHR without addressing the gap in metrics available to the facility may impede the facility and future sites’ ability to provide timely, effective, safe, and veteran-centered care. The OIG made two recommendations related to evaluating gaps in new EHR metrics and the factors affecting the availability of metrics and taking action as warranted.

Also in June, we published four Comprehensive Healthcare Inspection Program reports covering VA facilities located in West Virginia, Baltimore, and Washington, DC. These reports are one element of the OIG’s overall efforts to ensure that our veterans receive high-quality and timely VA healthcare services. The inspections are performed approximately every three years for each facility.

That’s it for the June highlights. To read them, visit va.gov/oig, and click on monthly highlights underneath the publications tab. Thanks for tuning in.

This has been an official podcast of the VA Office of Inspector General. Veteran Oversight Now is produced by the Office of Communications and Public Affairs and is available at va.gov/oig. Tune in monthly to hear how the VA OIG serves veterans, their families, and caregivers, through meaningful independent oversight. Check out the website for more on the VA OIG oversight mission, read current reports, and keep up to date on the latest criminal investigations. Report potential crimes related to VA; waste or mismanagement; potential violations of laws, rules, or regulations; or risks to patients, employees, or property to the OIG online or call the hotline at 1-800- 488-8244. If you are a veteran in crisis or concerned about one, call the Veterans Crisis Line at 1-800- 273-8255, press 1, and speak with a qualified responder now.