Intelligence Gathering

EPA reels as climate-change expert awaits sentencing for $1m CIA fraud

• John Beale pretended to be CIA agent for a decade
• Republicans round on agency chief Gina McCarthy
, US environment correspondent

theguardian.com,  Monday 16 December 2013 14.19 EST

Gina McCarthy
EPA administrator Gina McCarthy testifies before a Senate committee in April. Photograph: Joshua Roberts/Reuters

It is a story that flummoxed investigators – how a highly paid climate-change expert at the Environmental Protection Agency managed to defraud the government of nearly $1m, by pretending for a decade to be an undercover CIA agent.

John Beale, 65, is to undergo sentencing in a DC federal court on Wednesday, after pleading guilty to defrauding the government of $900,000 in salary and other benefits. Beale, who used his ruse to disappear for months at a time, has agreed to pay some $1.3m in restitution. He faces up to three years in jail.

The scandal could rebound against the current administrator of the EPA, Gina McCarthy, and her efforts to carry out President Barack Obama’s climate-change agenda. Last week, an official investigation found that she knew of the fraud for more than a year. Other officials who worked with Beale at the agency are under investigation and in a report last week, the EPA inspector general said senior agency officials had “enabled” Beale by failing to challenge any of his stories or expense claims amounting to hundreds of thousands of dollars a year.

Beale, who retired last April after learning he was under investigation, earned salary and bonuses of $206,000 a year, far more than his supervisors. His fraud consisted largely of failing to turn up for work – in one instance for 18 months – and offering excuses connected to his fake intelligence role at the CIA.

He faked malaria, and a rescue mission on behalf of a CIA colleague who was being tortured by the Taliban. He billed the government $57,000 for five trips to California – which he used to see his parents – and for lavish trips to London. But the CIA has no record of Beale ever walking in the door, let alone earning a security clearance, and the climate expert was actually using his absences to go for long rides on his mountain bike or catch up on reading.

Patrick Sullivan, the EPA assistant inspector general who carried out the investigation, told NBC: “I thought: ‘Oh my God, How could this possibly have happened in this agency?” He added: “I’ve worked for the government for 35 years. I’ve never seen a situation like this.”

The deception only came to light after Beale held a very lavish retirement party aboard a yacht on the Potomac River, but kept drawing his salary for another year. McCarthy and other officials attended his send-off. She later initiated the review of Beale’s activities.

Beale, who worked on landmark legislation of the Clean Air Act, remains well-connected in Washington, and a number of former colleagues were reluctant to comment on his case.

Sullivan told NBC he doubted such a fraud could occur anywhere other than the EPA. “There’s a certain culture here at the EPA where the mission is the most important thing,” he said. “They don’t think like criminal investigators. They tend to be very trusting and accepting.”

The EPA on Monday denounced Beale, and said McCarthy had uncovered the fraud when she headed the agency’s office of air and radiation. A spokeswoman also said that the EPA had put additional safeguards in place to protect against fraud and abuse.

“John Beale is a convicted felon who went to great lengths to deceive and defraud the US government over the span of more than a decade,” the spokeswoman said. She added that Beale had begun his deception when George HW Bush was president, and that McCarthy was the first official to challenge his claims.

“Every subsequent senior manager of that office was told that Mr Beale was in fact working for the CIA, a narrative that was not questioned until November 2012,” the spokeswoman said. “After those questions were brought forward by Administrator McCarthy, and once the EPA was not able to confirm any relationship between Mr Beale and the CIA, the Agency promptly referred this matter to our Office of Inspector General.”

Read More: http://www.theguardian.com/environment/2013/dec/16/epa-climate-change-expert-cia-fraud