Education Official Got Secret Cash Bonuses as Office Lost Billions to Fraud, Corruption

The senior Obama Education Department official who resigned this month to avoid testifying before Congress got hundreds of thousands of dollars in bonuses despite his well-documented failures, sources inside the agency tell Judicial Watch. The extra cash was kept off the books, away from the public, and doesnt appear on his official government salary record but Judicial Watch has obtained the figures with yearly breakdowns. The official, James Runcie, ran the scandal-plagued Federal Student Aid (FSA) office, the governments $1.4 trillion financial aid program. It includes, among other things, administering more than $150 billion in loans, grants and work-study funds to help students pay for college.

Under Runcies leadership there was pervasive fraud and corruption at the FSA, government sources tell Judicial Watch, including skirting federal rules to hire friends and family and hefty off-the-books cash bonuses despite the FSAs documented transgressions. Just last week the Education Department Inspector General told Congress that the FSA made an astounding $6 billion in improper payments in 2016 alone as part of federal student aid programs. The figure includes $2.21 billion in improper Pell Grant payments and $3.86 billion as part of the Direct Loan program. These are disbursements that either shouldnt have been made, went to the wrong recipient, were for an incorrect amount or were not properly documented. Each year the problem gets worse, according to Kathleen Tighe, Inspector General for the Education Department. Improper payments for the Federal Direct Loan program swelled from $1.28 billion in 2015 to $3.86 billion in 2016 and from $562 million to $2.21 billion for the federal Pell Grant program, all under Runcies leadership.

As chief operations officer for the troubled financial aid program Runcie, a political appointee of the Obama administration, was scheduled to testify at the same hearing before the House Subcommittee on Government Operations. Instead, he resigned abruptly to avoid congressional scrutiny. The disgraced education official tried to portray himself as the victim of a new administration that wants to dismantle the FSA. In a resignation memo obtained by an online news outlet, Runcie wrote this: I cannot in good conscience continue to be accountable as Chief Operating Officer given the risk associated with the current environment at the [Education] Department. He went on to write that he has been consistently on record and clear about not testifying at the upcoming hearing on improper payments and that he had not heard a single compelling reason the Education Department would need him to testify.

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