*John C. Beale was a high-profile policy advisory at the Environmental Protection Agency
- Reported directly to Administrator Gina McCarthy during most of the 13 years of fraud
- Claimed he was on covert assignments for CIA but really set home reading books or doing chores while earning $206,000 a year
- Assertions that he had undercover CIA job was never checked out by EPA
- Publicly retired and threw party for himself, but collected paychecks for another 18 months
By Michael Isikoff and Michael Zennie
A top climate change expert at the Environmental Protection Agency (EPA) has admitted to defrauding the government out of more than $900,000 by claiming he was an undercover CIA agent so he didn’t have to show up for work for months at a time. John C. Beale, pled guilty to bilking the government out of nearly $1 million in salary and other benefits over a decade and was sentenced in a Washington, D.C., federal court. In a newly filed sentencing memo, prosecutors said that his lies were a “crime of massive proportion” and “offensive” to those who actually do dangerous work for the CIA.
Two sentencing memos, along with documents obtained by NBC News, offered new details about what some officials describe as one of the most audacious, and creative, federal frauds they have ever encountered. When first looking into Beale’s deceptions last February, Patrick Sullivan said, “I thought, ‘Oh my God, how could this possibly have happened in this agency?” The EPA Assistant Inspector General Patrick Sullivan, who spearheaded the Beale probe, in an interview with NBC News, added, “I’ve worked for the government for 35 years. I’ve never seen a situation like this.”
NBC News reported that no one at the agency questioned or looked into his claims that he was working undercover for the CIA. He left the EPA office for weeks or months at a time — claiming he was at CIA headquarters in Langley, Virginia; or in Pakistan working on covert missions.
In reality, he was home reading, riding his bicycle or doing housework. Sometimes he escaped to his vacation home on Cape Cod, prosecutors say. He billed taxpayers for 33 plane flights between 2003 and 2011, including personal trips to London and California, which he flew first class. He stayed in five-star hotels and billed the government for expensive meals and limo rides. The total cost: more than $266,000.
He also publicly ‘retired,’ but managed to continue drawing his $206,000 salary for 18 months – despite brazenly throwing a retirement party for himself that was attended by EPA Administrator Gina McCarthy. (EPA Administrator Gina McCarthy was Beale’s boss during most of the 13 years he continued committing fraud).
He even lied and said he had contracted malaria while serving in the Vietnam War in order to get a handicapped parking spot. He neither had malaria nor served in Vietnam, according to prosecutors. EPA Assistant Inspector General Patrick Sullivan told NBC that Beale perpetrated a ‘crime of massive proportions.’
Beale admitted in court to the shocking fraud. Prosecutors are asking for a 30-month prison sentence, but defense lawyers say the judge should give him leniency because he suffered from a ‘highly self-destructive and dysfunctional need to engage in excessively reckless, risky behavior.’
Sullivan, who investigated Beale, said he believes the culture of the EPA made it ripe for this sort of fraud. ‘There’s a certain culture here at the EPA where the mission is the most important thing,’ he told NBC. ‘They don’t think like criminal investigators. They tend to be very trusting and accepting.’
Beyond Beale’s individual fate, his case raises larger questions about how he was able to get away with his admitted fraud for so long, according to federal and congressional investigators. Two new reports by the EPA inspector general’s office conclude that top officials at the agency “enabled” Beale by failing to verify any of his phony cover stories about CIA work, and failing to check on hundreds of thousands of dollars paid him in undeserved bonuses and travel expenses — including first-class trips to London where he stayed at five-star hotels and racked up thousands in bills for limos and taxis.
Beale is a Princeton-educated ‘senior policy adviser’ who worked as one of the EPA’s top climate change experts. He helped rewrite the Clean Air Act in 1990, led EPA delegations at climate change conferences in 2000 and 2001, and helped negotiate carbon emissions agreements with India and China. Beale, an NYU grad with a Masters Degree from Princeton, was earning a salary and bonuses of $206,000 a year, making him the highest paid official at the EPA. He earned more money than Gina McCarthy, the agency’s administrator and who, was for years, his immediate boss, according to agency documents.
He was caught only after McCarthy, who was appointed EPA administrator in July, discovered that he was still on the payroll in March 2012 – nearly six months after his retirement party. She called for an investigation, which led to the criminal charges.
In court, Beale’s lawyer, while acknowledging his guilt, has asked for leniency and offered a psychological explanation for the climate expert’s bizarre tales.
“With the help of his therapist,” wrote attorney John Kern, “Mr. Beale has come to recognize that, beyond the motive of greed, his theft and deception were animated by a highly self-destructive and dysfunctional need to engage in excessively reckless, risky behavior.” Kern also said Beale was driven “to manipulate those around him through the fabrication of grandiose narratives … that are fueled by his insecurities.”
Beale, who served as a “senior policy adviser” in the agency’s Office of Air and Radiation, pled guilty to defrauding the U.S. government out of nearly $900,000 since 2000. Beale perpetrated his fraud largely by failing to show up at the EPA for months at a time, including one 18-month stretch starting in June 2011 when he did “absolutely no work,” as Kern, Beale’s lawyer, acknowledged in his court filing.
To explain his long absences, Beale told agency officials — including McCarthy — that he was engaged in intelligence work for the CIA, either at agency headquarters or in Pakistan. At one point he claimed to be urgently needed in Pakistan because the Taliban was torturing his CIA replacement, according to Sullivan.
In fact, Beale had no relationship with the CIA at all. Sullivan, the EPA investigator, said he confirmed Beale didn’t even have a security clearance. He spent much of the time he was purportedly working for the CIA at his Northern Virginia home riding bikes, doing housework and reading books, or at a vacation house on Cape Cod.
“He’s never been to Langley (the CIA’s Virginia headquarters),” said Sullivan. “The CIA has no record of him ever walking through the door.”
Nor was that Beale’s only deception, according to court documents. In 2008, Beale didn’t show up at the EPA for six months, telling his boss that he was part of a special multi-agency election-year project relating to “candidate security.” He billed the government $57,000 for five trips to California that were made purely “for personal reasons,” his lawyer acknowledged. (His parents lived there.)
When first questioned by EPA officials early this year about his alleged CIA undercover work, Beale brushed them aside by saying he couldn’t discuss it, according to Sullivan. Weeks later, after being confronted again by investigators, Beale acknowledging the truth but “didn’t show much remorse,” Sullivan said. The explanation he offered for his false CIA story? “He wanted to puff up his own image,” said Sullivan.
Even at that point, prosecutors say, Beale sought to “cover his tracks.’” He told a few close colleagues at EPA that he would plead guilty “to take one for the team,” suggesting that he was willing to go to jail to protect people at the CIA. This has led some EPA officials to continue to believe that Beale actually does have a connection to the CIA, Sullivan said.
Kern, Beale’s lawyer, declined to comment to NBC News. But in his court filing, he asked Judge Ellen Huvelle to balance Beale’s misdeeds against years of admirable work for the government. These include helping to rewrite the Clean Air Act in 1990, heading up EPA delegations to United Nations conferences on climate change in 2000 and 2001, and helping to negotiate agreements to reduce carbon emissions with China, India and other nations.
Two congressional committees pressed the EPA, including administrator McCarthy, for answers on the handling of Beale’s case. The new inspector general’s reports fault the agency for a lack of internal controls and policies that allegedly facilitated Beale’s deceptions.
For example, one of the reports states, Beale took 33 airplane trips between 2003 and 2011, costing the government $266,190. On 70 percent of those, he travelled first class and stayed at high end hotels, charging more than twice the government’s allowed per diem limit. But his expense vouchers were routinely approved by another EPA official, a colleague of Beale’s, whose conduct is now being reviewed by the inspector general, according to congressional investigators briefed on the report.
In a statement to NBC News, Alisha Johnson, McCarthy’s press secretary, said that Beale’s fraud was “uncovered” by McCarthy while she was head of the Office of Air and Radiation. “[Beale] is a convicted felon who went to great lengths to deceive and defraud the U.S. government over the span of more than a decade,” said Johnson. “EPA has worked in coordination with its inspector general and the U.S. Attorney’s office. The Agency has [put] in place additional safeguards to help protect against fraud and abuse related to employee time and attendance, including strengthening supervisory controls of time and attendance, improved review of employee travel and a tightened retention incentive processes.”
At his trial sentencing last week, Beale, the EPA’s highest-paid employee and a leading expert on climate change was sentenced to 32 months in federal prison for lying to his bosses and saying he was a CIA spy working in Pakistan so he could avoid doing his real job.
John C. Beale’s crimes were “inexplicable” and “unbelievably egregious,” said Judge Ellen Huvelle in imposing the sentence in a Washington. D.C. federal court. Beale has also agreed to pay $1.3 million in restitution and forfeiture to the government.
John C.Beale is married to Nancy Kete; who President Barack Obama appointed the National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling. She is currently managing director of the Rockefeller Foundation.
The couple owns two homes; a $872,000 townhouse in Arlington, Virginia, and a $626,000 vacation home on Cape Cod.
Mmmm! 32 months for at least 13 years of fraud… Justice?