One person, now under prosecution, was fraudulently paid $275,000
under the recruitment program, and four other top recipients
received more than $100,000 apiece, documents from a panel of the
Senate Homeland Security committee said.
The Financial and Contracting Oversight Subcommittee, chaired by
Senator Claire McCaskill, was scheduled to hold a hearing on Tuesday
to address the case, which it described as "one of the largest fraud
investigations" Army investigators have ever handled in size and
numbers of people involved.
Investigators have begun a review of "all 106,364 individuals who
received money" from the Recruiting Assistant Program, the panel
said. Investigations are expected to continue through 2016, the
The Army declined to comment on the case. Senior Army officials were
due to testify at the hearing, including the service's top auditor,
investigator and staff director.
The recruiting program was initiated in 2005 at the height of the
Iraq war to address an enlistment shortfall in the Army National
Guard. The program paid members of the guard and others who were
approved as assistants between $2,000 and $7,500 for referring
people who eventually joined the state-based militia.
The program was successful in helping the Guard reach its
recruitment levels and was eventually adopted as well by the Army
Reserve and the active duty Army.
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Recruiters whose job was to locate new service members were not
meant to be eligible for the payments, according to documents from
the subcommittee. But effective controls were not in place to
prevent that from happening, the document said.
After reports of potential fraud in 2007, the Army Audit Agency
examined the program and found that 705 recruiters were linked to
payments with a high risk for fraud. Criminal investigators had
looked into 21 of those cases and confirmed fraud, the agency said
in an audit report.
Another 551 recruiters were linked to payments with a medium risk
for fraud, and 2,022 people who had registered as recruiter
assistants received payments that potentially violated the program's
rules, the audit said.
(Reporting by David Alexander; editing by Ken Wills)
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