"Stimulus" Fraud Drives DOT Investigations

The Department of Transportation watchdog service is investigating 66 cases of fraud, embezzlement and bid rigging involving stimulus funds diverted to transportation projects.  $48 billion of the $853 billion taxpayer funded stimulus gamble went to transportation projects that the President called “shovel ready.”

Of the 66 incidents, 25 are related to potentially fraudulent claims of Disadvantaged Business Enterprise status.  DBE status is given to businesses owned by people who are socially and economically disadvantaged.  In an effort to promote certain socioeconomic groups, the government gives preferential treatment to Disadvantaged Business Enterprises when under consideration for contract awards.  Calvin L. Scovel III, the Department of Transportation’s inspector general, claims the Justice Department is evaluating 47 of the 66 claims for prosecution.

While the government was busy giving businesses preferential treatment under the failed stimulus, Secretary of Transportation Ray LaHood claimed that, “there were no bad stories written about any of those projects—no boondoggles, no earmarks, no sweetheart deals.”  Perhaps he didn’t read Senator Tom Coburn’s (R-OK) list of 100 wasteful stimulus projects including $1 million for a guardrail to protect a non-existent lake or $350,000 to build a four-person bunkhouse in an Illinois wildlife refuge.

TAGS: Spending, Transportation, Transparency