[Excerpt] I am pleased to submit to Congress and the Department this Semiannual Report, which highlights the most significant activities and accomplishments of the U.S. Department of Labor (DOL), Office of Inspector General (OIG) for the six-month period ending March 31, 2017. Our audits and investigations continue to assess the effectiveness, efficiency, economy, and integrity of DOL’s programs and operations. We also continue to investigate the influence of labor racketeering and organized crime in internal union affairs, employee benefits plans, and labor-management relations, and have partnered with other law enforcement agencies on human trafficking matters.
During this reporting period, the OIG issued 11 audit and other reports that, among other things, identified $26 million in monetary impact. Among our many significant findings, we reported the following:
- For the period January 1, 2014, to June 30, 2015, 11 of the 12 Job Corps centers reviewed did not contact law enforcement for 42 percent of potentially serious criminal misconduct incidents. At all 12 centers, we identified significant incidents that had not been reported to Job Corps. We also observed physical security weaknesses, such as inoperable closed-circuit television cameras and damaged or no fencing along center perimeters. Finally, Job Corps required pre-employment background checks for only a few center positions.
- The Mine Safety and Health Administration’s oversight of emergency response plans was insufficient in that all the plans we reviewed contained inaccuracies or omissions, placing miners at unnecessarily increased risk during an emergency.
- The Occupational Safety and Health Administration did not ensure employers took adequate and timely actions to correct hazards identified during inspections for an estimated 16 percent of the citations the agency issued in FY 2015.
- The Employee Benefits Security Administration did not have the ability to protect the estimated 79 million plan participants in self-insured health plans from improper denials of health claims, due to a lack of knowledge of claim denials in the plans under its oversight.
During this reporting period the OIG’s investigative work yielded impressive results, with a total of 45 indictments, 116 convictions, and more than $41 million in monetary accomplishments. Highlights of our work include the following:
- Executives of a physical therapy company in Texas were convicted of health care fraud, and other charges, for their roles in a scheme to bill DOL’s Office of Workers’ Compensation Programs more than $9.5 million for services that were not provided.
- The chief executive officer of a Maryland contracting company was sentenced to 68 months in prison for stealing $1.7 million from Local 657 of the Laborers’ International Union of North America.
- A union business agent was sentenced to 41 months in prison and ordered to pay more than $1 million in restitution to International Longshoremen’s Association Local 970 for unlawfully withdrawing dues payments and new member initiation fees.
- A New Jersey woman was sentenced to 84 months in prison for collecting more than $300,000 in unemployment insurance from the New Jersey Department of Labor and Workforce Development for filing false applications.
These are some of the examples of the exceptional work done by our dedicated OIG staff. I would like to express my gratitude to them for their significant achievements during this reporting period. We continue to work on many important audits. For more details, I invite you to review our audit work plan for Fiscal Year 2017, which can be found in the appendix of this report. I look forward to continuing to work constructively with the Department and the Congress on our shared goals of identifying improvements to DOL programs and operations, and protecting the interests and benefits of workers and retirees.