A Top Commerce Department Official Lived Like a Rock Star at Taxpayers’ Expense
Policy + Politics

A Top Commerce Department Official Lived Like a Rock Star at Taxpayers’ Expense

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When a high ranking political appointee to the Obama administration’s Commerce Department first arrived for work in 2014, the official was horrified by the condition of his new office suite. The carpet was stained, paint on the walls was peeling, the furniture didn’t match and a toilet in one of the bathrooms didn’t work.

The new official complained to staffers and others that the office complex was a “[expletive] dump,” and set about to correct the problem. Although federal government rules limit the cost of upgrading an office to $5,000, the official ended up spending more than ten times that amount, according to a newly released Commerce Department investigative report.

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When the dust settled several weeks later, the offices were repainted, new ceiling tiles and lighting fixtures had been installed, three doors and transoms in the suites were refinished and a decorative brass kick plate was installed. Also, there were two bathrooms were remodeled, new carpeting was installed, electric switches were rewired to better regulate the light, and a new 50-inch television was mounted on the wall.

In all, more than $50,000 was spent to upgrade the offices of one of Commerce Secretary Penny Pritzker’s top aides, according to the Inspector General’s report released on Thursday. The allotted $5,000 was barely enough money to pay for the new carpeting and drapes. The remainder of the work was described in paperwork as “routine maintenance” and therefore was not restricted by the $5,000 cap.

The senior political appointee – whose name and gender was withheld by the IG in the 40-page report – first attracted government investigators attention in early 2015 after a whistleblower complained privately about excessive spending on redecorating and government travel at a time when government agencies were trying to rein in spending. The Commerce Department declined to comment yesterday on the IG’s highly detailed findings.

UPDATE: The Washington Post has now identified the official as Stefan Selig, the Commerce Department's undersecretary for international trade. The wealthy investment banker was confirmed by the Senate in 2014.

The senior official and a close aide both left their jobs before the final report was issued, according to the Inspector General’s office. While the official reimbursed the government for some of excessive travel costs, s/he challenged the IG on other expenses. The Inspector General’s report does not recommend that the Commerce Department take administrative action to try to recover additional funds.

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The official’s job responsibilities included traveling on official business around 20 times in the first year. But the reimbursement was above the standard per diem rate without providing adequate documentation and justification on over 60 percent of those trips.

Although the report doesn’t provide a precise accounting, it appears that the political appointee exceeded the federal per diem limits by many tens of thousands of dollars or more by staying at lavish hotels in the U.S. and overseas. S/he was also masterful in scheduling business trips around family vacations and excursions, and then ordering subordinates to fudge the travel records to cover up the chiseling.

“These trips included stays at luxury hotels around the world that were chosen primarily on the basis of Political Appointee’s personal preference, not mission necessity,” the report states. “In addition, at least a few of Political Appointees reimbursements included costs incurred on days when Political Appointee was on personal travel.”

One of the more celebrated trips uncovered by the IG was to Geneva, Switzerland. The senior official was reimbursed at 150 percent of the standard per diem rate for the entire stay at a luxury hotel there, even while s/he was on personal travel with a family member for two weekend days of the trip.

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The lodging per diem in Geneva at the time of this trip was around $340 per night, according to the report, and one staffer accompanying the senior official found a hotel with that rate. But instead, the official chose to stay at the luxury hotel that had been selected in advance by the family member that charged $1,150 a night.

In a similar vein, investigators found that one member of the senior official’s staff regularly sought government reimbursement for luxury car services for his boss on these trips when it was apparent that less expensive transportation would have been sufficient. “For example, the evidence shows that the government paid for Political Appointee and staff to ride in an SUV provided by a luxury hotel during a two-day trip to Boston, Massachusetts, at a cost of nearly $1,800,” the report stated.

There were also complaints that s/he routinely demanded underlings to handle personal chores, such as paying bills and arranging tours and dinners for family members and friends.