Three cases of potential fraud involving Minnesota National Guard "recruiting assistants" are under investigation as part of a wide-ranging scandal that has rocked the National Guard hierarchy nationwide.
The Minnesota cases are part of a broader recruiting scandal that involves tens of millions of dollars and thousands of soldiers and has been described as one of the worst in Army history.
National Guard soldiers are accused of taking kickbacks for signing up new recruits. The scam involved the Recruiting Assistance Program, which paid soldiers and even civilians thousands of dollars for helping to enlist recruits.
The Minnesota National Guard has confirmed three cases in which recruiting assistants are under investigation for improperly receiving cash benefits for referring applicants to Guard recruiters. While there are three cases being investigated, as many as 15 people may be involved in Minnesota, according to documents that have surfaced in the national investigation.
Since the 2005 inception of the referral program, a total of 2,719 recruiting assistants received a cash payment from the Army for referring applicants to Minnesota Army National Guard recruiters, the state Guard confirmed.The Minnesota Guard investigation reviewed all of the referrals from these recruiting assistants, and in 2012 forwarded 16 cases to the National Guard Bureau for further scrutiny. The National Guard Bureau examined the 16 cases and referred them to the U.S. Army Criminal Investigation Division for further investigation. Four Minnesota National Guard cases were referred to the U.S. Army Criminal Investigation Division for further investigation. Of those cases, one has subsequently been found to be unsubstantiated.
"We have been working closely with military and civilian authorities to pursue prosecution and restitution where fraud was committed, and to discipline those who were negligent in their duties," said Minnesota Guard spokesman Lt. Col. Kevin Olson.
Olson declined to provide further details or identify the suspects, citing the ongoing investigation.
Cases came to light last week
The Minnesota Guard cases were revealed as part of documents produced in a fiery Senate hearing last week into reports of pervasive fraud, abuse and mismanagement in the award and administration of the contracts for the recruiting program.
The Minnesota cases represent a small part of the scandal. An Army audit and other investigations found that as much as $29 million may have been wrongly paid to people who claimed to have assisted in recruitment.
The program was developed in 2005 to address diminishing recruiting numbers while the county was engulfed in two wars. Under the program, informal "recruiting assistants" would refer individuals to an Army recruiter for a cash payment of between $2,000 to $7,000. The recruiting assistants could include members of the National Guard not on active duty, retirees, family members or other civilians. They were hired as contractors by a for-profit company that ran the program, an Alabama-based marketing firm, Docupak.
The National Guard paid over $300 million for more than 130,000 enlistments. Buoyed by the Guard's success, the active Army and Army Reserve began using the program as well.
But the program quickly spiraled out of control. An audit found that more than 1,200 recruiters (the large majority from the Army National Guard) were associated with payments that were at a risk for fraud and more than 2,000 recruiter assistants had received payments that might be fraudulent. In some cases, a high school guidance counselor or principal would enter names of students as nominees without their permission.
The top five recipients of the program each made more than $100,000. The top recipient received $274,000 and is currently being prosecuted. As of January, 559 criminal investigations involving 1,219 individuals have been launched.
"I cannot begin to express how disappointed and angry I am to hear of such carelessness with taxpayer dollars," Sen. Claire McCaskill, D-Mo., said at the Feb. 4 hearing of the Senate Homeland Security and Governmental Affairs subcommittee on financial and contracting oversight.