By Jim Kouri
The top executive of the U.S. General Services Administration (GSA) stated on Monday that she had tendered her resignation to President Barack Obama after two of her top assistants were terminated from employment amid allegations of excessive spending at a conference held at a luxury hotel, according to an anonymous source who investigates government corruption and criminal activities by government executives.
The GSA’s Administrator Martha Johnson submitted her resignation early Monday morning and the Public Buildings Service chief Robert Peck and Johnson’s top adviser, Stephen Leeds, were immediately fired on when their spending spree was discovered and confirmed. Johnson, 59, is a former official in President Bill Clinton’s administration.
Four additional GSA employees — who organized the four-day conference — were placed on administrative leave pending further investigation, said the Law Enforcement Examiner’s source in Washington, DC.
So far, there has been no mention of criminal charges in this latest Obama Administration scandal.
The firings, suspensions and Johnson’s resignation come as the GSA’s Inspector General’s office prepares to release a report on the training conference, held at a luxury hotel in Nevada close to Las Vegas in October 2010. This conference attendance occurred days after President Barack Obama scolded corporate “fat cats” who attend expensive conferences and conventions in Las Vegas.
The scathing IG report revealed a “gross misuse of taxpayer dollars” on an internal conference that was “excessive, wasteful, and in some cases impermissible.”
Organizers spent more that $850,000 on the event, which was attended by 300 GSA employees. The expenses included $147,000 in airfare and lodging at the hotel for six planning trips by a team of organizers.
Among the other expenses were $3,200 for a mind reader; $6,300 on commemorative coin set displayed in velvet boxes and $75,000 on a training exercise to build a bicycle, said Law Enforcement Examiner’s Washington source.
“This is a case that needs to be thoroughly investigated by a special prosecutor. One can only wonder what other incidents of corruption are occurring in agencies headed by this president’s friends and supporters,” said Michael Baker, a political strategist and attorney.
“When the White House was informed of the Inspector General’s findings we acted quickly to determine who was responsible for such a gross misuse of taxpayer dollars,” White House Chief of Staff Jack Lew said in a statement.
President Obama “was outraged by the excessive spending, questionable dealings with contractors, and disregard for taxpayer dollars,” Lew said, “and called for all those responsible to be held fully accountable.”
Johnson will be replaced by Dan Tangherlini, an assistant secretary in the Treasury Department and former city administrator for the District of Columbia.
In 2010, investigations revealed that GSA paid $234,000 to a Kansas City public relations firm to manage negative publicity that GSA was receiving as a result of mismanagement of their own internal investigations.
As a result, Senator Claire McCaskill announced that she would launch an investigation into the use of tax dollars used by federal agencies to hire public relations consultants to “spin” their images. In a November 2010 letter to Martha Johnson, Senator McCaskill reminded GSA that “publicity experts” cannot engage in “publicity and propaganda” unless authorized by Congress and requested a detailed report of the government’s use of these services.