Fed Judge issues temp restraining order against whistle blowers
Federal Judge James Brady issued a temporary restraining order Wednesday against two former state contract workers who possess documents related to the Road Home Program and the Hazard Mitigation Grant Program.
The workers allege documents were forged.
Both workers have filed suit saying they were retaliated against, and one of them fired, after bringing the allegations to light.
The order prevents the workers from releasing the documents to anyone. Judge Brady scheduled a hearing for August 24th to decide whether to force the workers to return the documents to the state. The request for the restraining order was signed by Louisiana Attorney General James "Buddy" Caldwell.
The two former workers say some of the documents they possess show that dollar amounts on some contracts were forged to increase the price that contractors would be paid for their work. The contracts deal with work to elevate Louisiana homes that are in flood-prone areas.
The former workers, Christy Weiser and Thomas Pierson, allege certain contractors were allowed to falsely inflate the cost of their work after the contracts were signed and without the knowledge of homeowners. This, the workers allege, allowed certain contractors to be paid a higher rate for their work.
The workers provided the 9NEWS I-Team with what they say is a copy of a contract for work to elevate a home on Music Street in New Orleans. The workers say the homeowner signed the contract with a total cost of $90,480. However, the workers presented another document that they say shows the cost of the work was later increased to $113,100 - a difference of $22,620. The workers contend the contract with the higher price is the one submitted for reimbursement for the work.
The whistle blowers also accuse some state workers of accepting gifts and favors from contractors in exchange for allowing the alleged fraud to occur.
In the lawsuit the workers filed against The Shaw Group and the State of Louisiana, the workers make numerous allegations including documents being forged, a "state official receiving jewelry from a contractor", state officials "accepting meals and items of value from private contractors", and other allegations of wrongdoing. The lawsuit alleges they were retaliated against after bringing allegations to light.
Christina Stephens, Director of Communications for the State Office of Community Development issued a statement last week regarding the case. "If we suspect inappropriate activity has occurred, matters are investigated internally and we may choose to refer the issue to the Attorney General's Office, the Office of the Inspector General, to other law enforcement officials or to take other appropriate measures," Stephens said. Stephens said Wednesday afternoon an investigation is now underway into allegations raised by the workers. She did not say which agency is heading up that investigation.
A spokeswoman for The Shaw Group said Shaw intends to "vigorously defend this matter". Weiser says she was fired after bringing allegations to light. Pierson says Shaw "suspended him until further notice" after he spoke with the 9NEWS I-Team.
A Shaw spokesperson said Shaw was "hired to provide staff augmentation to the state who is managing the program. "We are simply providing additional staff to supplement the state's existing staff on the project," the spokesperson added.