WASHINGTON, July 29 There is currently no
evidence of widespread fraud within the U.S. Export-Import Bank,
its internal watchdog said, as critics of the bank flagged a
wider probe of corruption claims.
Three Ex-Im employees have been dismissed and another
suspended amid investigations into allegations of gifts and
kickbacks, cases which could lead to criminal charges and have
given ammunition to conservative lawmakers seeking the bank's
But Ex-Im's inspector general, who investigates complaints
about improper behavior, said although internal investigations
showed some instances of ineffective management of employees,
they had not found serious systemic problems.
"At this time, we have not developed evidence of widespread
employee misconduct or systemic employee involvement in fraud
schemes at the bank," Acting Inspector General Michael McCarthy
wrote in a July 28 letter to Democrat Matthew Cartwright, which
was presented during a Congressional panel hearing. "These
investigations are ongoing."
Ex-Im Chairman Fred Hochberg told the hearing he had not
heard of any other cases of employee corruption during his time
at the bank, which he joined in 2009. Ethics training was
mandatory for all staff, and all the cases involving employees
were reported by other employees.
Former Ex-Im employee Johnny Gutierrez was subpoenaed to
appear at the hearing but declined to answer questions. The Wall
Street Journal reported in June he allegedly took cash payments
in exchange for attempting to assist a Florida company to get
credit to export construction equipment to Latin America.
The inspector general's office said 46 people had been
convicted of defrauding the bank since 2009 and there had been
71 indictments or federal criminal charges, none involving
employees. One 2010 conviction involved a former employee, but
that case was investigated before the office was established,
the letter said.
Republican Jim Jordan said the inspector general had told
the House Committee on Oversight and Government Reform there
were at least 40 ongoing fraud investigations at the bank.
"If that is the way in which some of the employee misconduct
could be discovered ... if there are substantial number of
outstanding fraud investigations, it stands to reason that there
very well may be more instances of employee misconduct,"
Republican Ron DeSantis said.
Representative Jeb Hensarling, who is leading the charge
among Republicans not to renew the bank's charter when it
expires on Sept. 30, said it was important to have the full
picture before deciding whether to keep the bank open and he
would seek more information about the active investigations.
(Reporting by Krista Hughes; Editing by Bernard Orr)