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Embezzlement ring scandal leads to Marine Corps policy changes

Jan. 21, 2014 - 06:45PM   |  
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The Marine Corps is tightening its travel and expense policies in response to an embezzlement scandal involving reservists that hit headlines late last year.

The Marine Corps is tightening its travel and expense policies in response to an embezzlement scandal involving reservists that hit headlines late last year.

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The Marine Corps is tightening its travel and expense policies in response to an embezzlement scandal involving reservists that hit headlines late last year.

Lt. Gen. Richard Mills, commander of Marine Forces Reserve, said in an interview that the Marine Corps is eliminating cash advances for travel and increasing oversight on temporary active duty orders to discourage dishonesty and theft. The new rules for TAD orders affect active-duty personnel as well as reservists.

The Internal Revenue Service charged seven Marine reservists in November with conspiracy to defraud the Defense Department to the tune of more than $874,000. The reservists, all from 3rd Air Naval Gunfire Liaison Company out of Terminal Island, Calif., were accused of receiving payments for fraudulent travel and hotel expenses. Another 21 Marine reservists were charged with filing false tax returns as part of the IRS bust. The indictment alleges that one of the Marines filled out travel vouchers with phony information to receive reimbursements for nonexistent trips and false lodging costs.

Mills said in December that the legal process for these Marines is ongoing, although there is a hard line on the behavior they were accused of: “The Marine Corps doesn’t tolerate thieves.”

But the scandal highlighted gaps in the system that were conducive to dishonest behavior, and Mills said initatives are underway to close those gaps.

“In past days, you’ve been able to draw a cash advance if you were going to go off and do some (temporary active duty assignment) somewhere,” he said. “That can cause problems, some of them unintended, some of them unfortunately planned out to where a Marine can have money that he’s not entitled to. And we’re closing the gap on that.”

Cash advances will be done away with as the Corps pushes Marines toward the already existing government charge card system, forcing them to be accountable for what they spend.

And Mills said the Marine Corps also is reworking the system to make it much more difficult to perpetrate garden-variety embezzlement with TAD orders without getting caught.

New rules, he said, will ensure that no one person “is writing orders and approving orders and paying orders ... not one single person does that. There’s always two sets of eyeballs that look at every set of travel orders to make sure that, hey, these are issued, they are paid appropriately, and the travel claims are adjudicated correctly.”

Fiscal austerity in light of long-term sequestration budget cuts means the Reserves will be forced to scale back TAD travel to save money, Mills said in the same interview.

In November, during testimony before the Senate Armed Services Committee, Marine Corps Commandant Gen. Jim Amos also acknowledged that TAD travel had been placed under a microscope as the Corps sought to slash costs.

“We’ve already gone through our TAD travel accounts,” he said. “We’ve taken our reserves, taken them off active duty, to reduce the TAD cost.”

But in the case of Marines who face punitive actions as a result of paperwork errors rather than actual fraud, as some reservists have alleged recently, Mills said there are procedures in place to request that an overpayment be excused.

“I think, without prejudging any case, innocent mistakes will be looked at leniently,” Mills said.

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