The Justice Department is accusing the private contractor that vetted him and thousands of other intelligence workers of bilking U.S. taxpayers out of tens of millions of dollars by conducting phony background checks.
USIS, the giant private contractor that conducted the background checks of both Snowden and Washington Navy Yard shooter Aaron Alexis, is accused in a Justice Department lawsuit filed Wednesday night of conducting 665,000 fake background checks between 2008 and 2012.
“USIS management devised and executed a scheme to deliberately circumvent contractually required quality reviews of completed background investigations in order to increase the company’s revenues and profits,” said the Justice Department in its complaint, which was filed in U.S. District Court in Alabama.
The DOJ lawsuit cites internal emails to back up charges that USIS senior officials devised a wide-ranging “scheme” to defraud the federal government on background checks through a practice known as “dumping” or “flushing” in order to boost the firm’s profits.
“Shelves are as clean as they could get,” reads one April 2010 email from a “workload leader” to USIS director of National Quality Assurance. “Flushed everything like a dead goldfish.” Another email reads: “Scalping tickets for ‘Dick Clark’s Dumpin’ New Year’s Eve!’ … Who needs 2?”
The practice of “dumping” or “flushing” involved certifying to the U.S. Office of Personnel Management that full “quality review” background checks had been performed when in fact those reviews had not been completed. Aided by a software program known as “Blue Zone,” USIS identified large volumes of cases at the end of day as “Review Complete” — and then fraudulently certified them to OPM, according to the complaint.
Between March 2008 and September 2012, “USIS released at least 665,000 background investigations” to OPM, certifying them as completed when they actually hadn’t been, the complaint charges. This amounted to 40 percent of all the background checks performed by USIS done during this period., it said. The allegedly fraudulent background checks included employees seeking security clearances at the Department of Defense, Homeland Security, Justice Department and other federal agencies.
The suit charges that USIS senior management “was fully aware of, and in fact, directed the dumping practices.” It notes that the firm was paid $11.7 million in bonuses under its contract between 2008 and 2010.
A company source, who spoke to NBC News on condition of anonymity, said that some employees involved in the fraud “were terminated” and that all of the individuals cited in the complaint — including top USIS executives — no longer work for the firm. The source also stressed that neither the Snowden nor the Alexis background checks were among those cited as fraudulent in the complaint. (The complaint does not identify any of the allegedly improper checks.)