A$hcroft $ings...Let The Dollars $oar

FORBES

Associated Press
Ashcroft: No Conflict on Monitoring Deal
By ANGELA DELLI SANTI 03.11.08, 5:22 PM ET

Zimmer a manufacturer of replacement hips and knees, was one of four companies that agreed to pay fines and hire outside monitors under deferred prosecution agreements settling charges over alleged kickbacks to doctors.

Zimmer agreed to pay Ashcroft's law-lobbying firm between $28 million and $52 million to monitor the company for 18 months and report the results to the government.

Rep. Henry Johnson Jr., D-Ga., asked Ashcroft why his firm is collecting two fees - $750,000 a month plus $895 per hour - more than other monitors also appointed in the New Jersey case.

"The reason our fees are appropriate is the complexity of the case and the extent to which we have been involved," Ashcroft replied.

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Office of Management and Budget

Article compliments of OMB Watch

Thursday, January 17, 2008

The Blind Leading the Blinder

The Washington Post reported this morning that congressional leaders have asked the Government Accountability Office (GAO) to investigate the use of no-bid contracts to hire businesses and corporations to oversee and monitor other businesses and corporations. Sen. Patrick Leahy☼ (D-VT) and Rep. John Conyers☼ (D-MI) apparently thought something smelled fishy when a federal prosecutor steered a no-bid, 18-month contract worth between $28 million and $52 million to his old boss, former Attorney General John Ashcroft.

The contract is for overseeing an out of court settlement the Justice Department reached with a knee and hip replacement company called Zimmer Holdings, Inc. from Warsaw, Indiana. Apparently Zimmer Holdings was accused of bribing giving kickbacks to doctors who used their knee and hip implants. Now the way these types of settlements work is that the monitoring company is paid directly by the offending business that it is supposed to be monitoring. Therefore, Ashcroft's consulting firm will be paid directly by Zimmer Holdings - the very entity he is supposed to be overseeing to make sure, if you can believe this, they don't make more illegal payments or bribes.

It's hard for me to even begin to describe the gut-wrenching, mind-boggling irony of this situation. First off, how can Mr. Ashcroft be expected to monitor a company in an independent manner that is paying him directly? Second, it's not like Zimmer Holdings was accused of union-busting or providing unsafe working conditions for its employees. They were accused of bribing doctors! Wouldn't it be reasonable to believe they could continue to attempt to offer illegal bribes? And how would the public know if they were doing that? Because the monitor company's bills are not subject to an independent review, are we just supposed to take Mr. Ashcroft's word for it?

While I certainly wouldn't accuse Mr. Ashcroft of being involved in covering up questionable activities or practices (cough), he isn't the only one involved in contracts like these. In fact, they are being relied on by the Justice Department more and more. A new study by two lawyers in Texas has found there has been a 600 percent increase in these types of settlements between the department and large companies in the last five years. Even more amazing, the same prosecutor who awarded the contract to Ashcroft (Mr. Christopher Christie of New Jersey) has directed similar contracts to other former colleagues at the Justice Department, and several other former government officials with ties to the Bush administration have been awarded similar contracts since 2001 according to the Washington Post. While we all know Mr. Ashcroft is above reproach, I have no way to know whether these other former government officials are.

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