Smithsonian Contractor Continues To Run Parking Concession Despite Massive Fraud By Employees

300px-StevenFUdvarHazyMany of us who love to visit the Smithsonian’s Udvar-Hazy Air and Space annex in Chantilly often complain about the high $15 parking fee required of visitors (who have no choice but to park at the site. Now, it appears that more than $1.5 million was skimmed off by the booth personnel working for PMI Corporation. Freweyni Mebrahtu, 46, was sentenced to two years and three months in prison for her part in the conspiracy last week. Notably, Mebrahtu insisted that she never stole during the Muslim holy days of Ramadan. It appears that she considered that to be proof of being a moral person.

In her sentencing hearing, Mebrahtu admitted to stealing over $895,000 over three years, but said that she did so at the urging of her supervisors with parking contractor PMI. She said that her supervisors demanded two-thirds of the money Mebrahtu took in.

A second employee, Meseret Terefe was sentenced to 20 months in prison after for stealing $487,000 in parking fees and a third employee died awaiting trial. The third employee is believed to have stolen $120,000 during her tenure.

The employees would unplug the machines that counted the vehicles to skim the fees for almost 40 percent of the cars coming to the museum. That is an amazing degree of fraud and it is hard to believe that supervisors at PMI were not aware of the discrepancy. The best case for PMI is to insist that it is grossly incompetent and negligent. The company has refused to respond to media inquiries, apparently believing that it has not obligation to answer any questions from the public as a government contractor.

What is astonishing is that PMI continues to run the parking at the museum. Indeed, Smithsonian has said that it has not decided whether to award PMI another contract when its current contract expires in April. It appears that missing the revenue for 40 percent of the cars is not viewed as, in itself, grounds for non-renewal — let alone early termination — in a government contract.

Source: Fox

37 thoughts on “Smithsonian Contractor Continues To Run Parking Concession Despite Massive Fraud By Employees”

  1. Does the contract provide for recovery? it may not be a matter of poor enforcement, but poor contract writing. PMI is not some mom and pop, they operate a variety of parking facilities in the area. i wonder what the norm is for their corporate contacts? As for being the only way, it isn’t. there’s a shuttle from the airport terminal (which has its own parking hassles) and there are various public transit options, although some of them would cost more for a family than paying to park.

  2. “You guys are knee jerk reactionaries.”

    It’s a good thing you smiled after saying that considering what your initial reaction to this crime was, Bron. Also, detecting a pattern crime like systemic fraud can take time. You know what they say about patterns: once an accident, twice a coincidence, thrice a pattern. I suspect it might have taken them even longer to detect if PMI hadn’t been so greedy as to go for 40ish percent. Plus, if you want to worry about monies that could be used to lower your tax burden, I’d suggest starting with companies like GE not paying any taxes – as in zero – on 5.1 billion in profits (and 14.2 billion if you want to include international sales) and in fact getting 3.2 billion in tax benefits. Now that’s a social crime on a different scale altogether that might actually impact your personal situation. The PMI thing is small potatoes in comparison.

  3. Mike/Gene:

    it says it was going on for 3 years. They should have had, at a minimum, yearly audits.

    I havent mentioned privatization. I am quite happy with the Smithsonian as a government enterprise. Sueprise, sueprise.

    Why do you think private companies can take advantage of the government? How hard is it to husband tax payer funds? The reason it is hard is there is no incentive to be good stewards of our money.

    I would rather give bonuses to government workers for saving money than to give it to people who are f*cking me through stealing money that could have been used to lower my tax burden.

    You guys are knee jerk reactionaries. 🙂

  4. mr.ed,

    If I had to guess, that’s probably close to if not exactly how the fraud was detected.

  5. If you asked for a receipt and were told “the machine’s down” would you report it to the management? Of course not. So, how would they be able to reliably track the fraud? How about an entry head count divided by the average number per vehicle at similar facilities such as the Air and Space museum or the Air Force museum (Dayton)?

  6. Bron,

    It is hard to escape that hiring private contractors to perform tasks more cheaply performed by the government entity themselves, has been part and parcel of Conservative “privatization” schemes for more than 40 years. It is a direct result of the false notion that private contractors are more efficient than government employees. That is a false notion, prove false time and again. Yet the practice persists and usually because of the political connections and donations of the private contractors. See Halliburton’s record of murdering our troops in showers.

  7. One solution might be to require govt. contractors to widely publicize the False Claims Act which permits people reporting fraud to receive a portion (usually about 15–25%) of any recovered damages.

  8. And exactly how do you know it wasn’t an audit that caught this problem in the first place, Bron?

    It is not mentioned in the story, only that the PoPo thought that the amount stolen “exceeded $400,000 but were unsure of the exact amount” when the crime was reported. Reported by whom? And why?

    Your anti-government Libertarian rant against government in this instance simply doesn’t hold water.

  9. Why is a contractor being allowed to collect the parking fees at ALL? Why do the taxpayers have to pay to park, and then pay some crooked contractor to charge the government a fee for the people to use their own property? The Smithsonian needs to take over the collection of all parking fees if they are going to do that. It is GOP fraud run amok, and I am sure that their GOP buddies will pass a law in Congress to privatize the Smithsonian and to tout the benefits of “free” enterprise.

  10. Gene H:

    I would say that I would be auditing the parking company on a regular basis since it is a cash business.

    I think it is incompetence to not have done that and possibly, who knows, maybe the Smithsonian contracting officer was getting a little of the vig.

    If you had a cash business which was being run by a third party, would you not monitor your interests? I would.

    This goes on all the time with private companies doing business with the government. They [government] just write blank checks, why?

    Fool me once, shame on you, fool me twice shame on me.

  11. Yo. JT. If it was a catolic who did the theft deed, would we be hearing about his religion?

  12. When will the visitors to the museum say “enough”? Fifteen Dollars? Is there not a Metro train to that place? The article says that visitors have no choice. You could park at the nearest Metro stop and then go on to the rip off joint. We need to itchBay to Eleanor Holmes Norton or some Congress rep from DC.

  13. Bron,

    How exactly is the fraud of a private contractor an example of “waste, fraud, abuse and incompetence in government”?

    Break that down for us.

    Because this is a crime committed by a private company employing private citizens and the victim is the Smithsonian.

  14. just another example of waste, fraud, abuse and incompetence in government.

    When will the tax payers say “enough”?

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