Pro-Trump official, fired over Halper contracts, backed by IG

FPI / August 20, 2019

A report by the Department of Defense's inspector general reveals that Stefan Halper, the professor hired by the FBI to spy on the Trump campaign, failed to document his research on four Pentagon studies for which he traveled the world at U.S. taxpayer expense and was paid a total of $1 million.

The DoD inspector general launched the Halper investigation based on a request in January from Senate Finance Committee Chariman Chuck Grassley, Iowa Republican. "He, in turn, was acting on allegations of sweetheart contacts at the Office of Net Assessment (ONA), a secretive Pentagon think tank whose mission is to find and expose future global threats," security correspondent Rowan Scarborough noted in an Aug. 18 report for The Washington Times.

The IG's report is a vindication of Pentagon analyst Adam Lovinger, who blew the whistle on the lucrative contracts Halper received from the ONA, Lovinger's attorney said.

After questioning the Halper contracts, Lovinger had his security clearance revoked and was suspended without pay by Obama-appointed officials who accused him of mishandling sensitive data.

“The results of this audit only begin to scratch the surface of Mr. Lovinger’s whistleblower complaints about ONA contracting practices,” said his attorney, Sean Bigley. “DoD destroyed Mr. Lovinger because he had the audacity to point out the obvious.”

In a letter to then-acting Defense Secretary Mark Esper last month, Grassley said “The DoD IG’s audit revealed significant flaws in ONA’s contract management and oversight process that clearly indicate ONA’s internal controls over taxpayer-funded work are weak or non-existent.”

James Baker has run the ONA since 2015, when Andy Marshall retired at the age of 93. Marshall, known as the Pentagon's "Yoda," had run the ONA for more than 40 years.

At the time of Marshall’s retirement, Defense News wrote: “No single individual has had a greater, nor more sustained, effect on U.S. national security, whether through his work to ensure success during the Cold War, or the decades after by consistently finding ways to impose strategic costs on America’s adversaries.”

According to an Aug. 18 report by Washington Times security correspondent Rowan Scarborough, the DoD inspector general’s report focused on four Halper contracts from 2012 to 2016 for which he was paid handsomely to focus on relations among the U.S., Russia, China and India. Halper is a former professor at Cambridge University in Great Britain, where he ran an intelligence consultancy.

Halper presented his proposals, called “statements of work,” to ONA, Scarborough's report noted. The proposals included the prominent people he would interview and the countries and institutions he would visit. ONA told the inspector general that Halper’s work was “high quality.”

For a 2016 Russia-China study, "Halper promised access to some of the brightest minds on foreign policy," Scarborough noted.

But, in a July 2 report, the DoD inspector general stated: “ONA personnel could not provide us any evidence that Professor Halper visited any of these locations, established an advisory group, or met with any of the specific people listed in the statement of work.”

For Halper's study on China in year 2030, the inspector general said: “According to the statement of work, Professor Halper proposed travel to London, England and Tokyo, Japan. The contract was fixed price based on the acceptance of the deliverables and did not require Professor Halper to submit travel receipts. ONA personnel could not provide documentation that Professor Halper traveled for this contract.”

The Washington Times last year examined Halper’s $244,000 Russia-China report, which focused on suspected collaboration between the two U.S. adversaries.

On Page 7, Halper states: “Consultants and Advisors. The following consultants and advisors contributed to the analysis within this study.”

Scarborough noted that "On two pages is a list of 43 such contributors, in some cases a who’s who of Washington’s national security brainpower. The Times checked with 15 of the 43."

Michael Hayden, retired Air Force general and former CIA director, told The Times: "No memory of project or person. Quick search of calendar and email shows nothing."

Jonathan Haslam, a Princeton professor and noted scholar on Soviet history, said: “I was never asked to participate in this study and I would not have agreed to do so anyway. I find it troubling that I am listed in a study that I never participated in.”

On the report in question, the DoD inspector general said Halper had promised to visit the National War College, the British Ministry of Defense, Harvard University and other settings. He also would meet with “strategic analysts, economists and experts” and develop an advisory group.

The inspector general concluded: “None of the 851 footnotes in the deliverables attributed source material to an interview conducted by Professor Halper. ONA personnel could not provide us any evidence that Professor Halper visited any of these locations, established an advisory group, or met with any of the specific people listed in the statement of work.”

The inspector general’s finding was similar on Halper’s China-India report, Scarborough noted.

Halper submitted invoices to ONA for travel to India, London, Cambridge and Japan. Part of the Japan visit was financed by an unidentified third party.

“ONA personnel could not provide documentation that this travel related to [the] contract or the name of the third party who paid part of Professor Halper’s travel expenses,” the inspector general said.

As he did with the 2016 Russia paper, Halper listed a number of high-ranking officials and scholars he planned to consult and interview for the China-India report.

After examining the paper, the inspector general concluded: “None of the 348 footnotes in the deliverables attributed source material to an interview conducted by Professor Halper. ONA personnel could not provide us with evidence to show that any of these high-ranking officials contributed to Professor Halper’s India-China study.”

ONA officials told investigators that they do not require any contractor to show they actually interviewed the people they said they would. ONA also does not require a contractor to show proof of study work while on taxpayer-funded travel, Scarborough's report noted.

Lovinger complained in emails to Baker that the ONA had become a lure for high-priced academic-style papers instead of classified “net assessments.”

Interview transcripts show that ONA officials have acknowledged under questioning that the office has not produced a net assessment, its core mission, for 12 years, Scarborough noted.

“On the issue of quality, more than once I have heard our contractor studies labeled ‘derivative,’ ‘college-level,’ and based heavily on secondary sources,” Lovinger wrote in a September 2016 email. “One of our contractor studies was literally cut and pasted from a World Bank report.”

The inspector general’s report criticized ONA for not following the Federal Acquisition Regulation in handling Halper’s contracts.

The report listed a number of violations. For one, ONA failed to file away nomination letters on two contracts. In three contracts, ONA didn’t document communications its staff conducted with Halper. ONA also failed to comply with the regulation by ensuring his travel and interviews matched his statement of work.

ONA "submitted to the inspector general’s office a three-page plan to correct its loose contracting procedures," Scarborough noted. "It plans to create an official standard operating procedure by October, it said. On the inspector general’s recommendation that it verify that a finished study matched the 'statement of work' proposal, ONA said yes, but with a caveat."

“ONA does not agree that every contract requires exhaustive or significant verification of the methods used to derive analytic content,” the office said. “ONA quality control measures will be dictated by ONA requirements and the statement of work. Deliverables are reviewed and accepted based on the quality of the work and in accordance with the terms of the contract. Consistent with this practice, deliverables were reviewed and assessed for the four contracts audited by the DoD OIG. The Government received deliverables that were high quality and conformed to the requirements set forth in the contract. The Government determined that the contractor performed satisfactorily.”

ONA also said it will require all contractors to produce travel receipts for reimbursement.

As for Lovinger, "his career encountered a train wreck," Scarborough wrote. "With the election of (President Donald) Trump, he sought an assignment at the White House. After just a few months, the analyst was quickly pulled back to the Pentagon after Baker started an investigation. It found that Lovinger had violated security procedures on handling sensitive information. He also was accused of leaking ONA insider stories to news media."

Lovinger "denied all charges," Scarborough continued. "He saw the punishment as whistleblower reprisal. He appealed, but after a trial in December, an administrative judge sided with ONA. The judge, however, did not substantiate the leak charge."

A copy of a Naval Criminal Investigative Service (NCIS) report obtained by The Washington Times said there was no evidence that Lovinger leaked to the media or that his government-provided computer contained classified or sensitive material.

Bigley said the government failed to turn over the NCIS documents for Lovinger's December trial. He filed a complaint with the Defense Department inspector general, who is hearing Lovinger’s whistleblower reprisal case.

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