Education Scandal Deepends; Inspector General Must Investigate

Why did a top official at the Department of Education continue to receive federal benefits after he left his federal job?

Today, Citizens for Responsibility and Ethics in Washington (CREW) sent a letter to Department of Education (DOE) Inspector General Kathleen S. Tighe asking for an investigation into the department’s consultant agreement with former Deputy Undersecretary Robert Shireman. Mr. Shireman left his government job in June of 2010, but was immediately hired as a paid intermittent consultant to Education’s Office of Federal Student Aid.

Despite this change in employment status, newly released documents show Education officials agreed Mr. Shireman could continue to receive federal benefits, including health care, paid leave, and retirement benefits. Education’s personnel manual specifically prohibits intermittent consultants from receiving such benefits. Education redacted the identities of the officials who signed off on the agreement.

“Mr. Shireman got one heck of a deal: benefits available to federal employees without the bother of a full-time job,” said CREW Executive Director Melanie Sloan. “Given his role in the growing scandal that shows the cozy relationship between DOE officials and Wall Street short-sellers, the inspector general needs to take a look at this arrangement and find out who agreed to it and why.”

During his time as Deputy Undersecretary, Mr. Shireman headed the effort to more stringently regulate for-profit education companies. An investigation by CREW has uncovered records that show extensive contact between DOE officials and Wall Street investors. Particularly troubling were the many emails that revealed short-sellers were influencing proposed regulations in a way that stood to drive down the stock price of for-profit colleges and allow investors to reap huge profits. Based on these documents, CREW asked the Securities and Exchange

Commission to investigate possible market manipulation and twice asked Education Secretary Arne Duncan to examine the improper influence on Education’s regulatory process

Click through for access to documents.


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