Despite a criminal referral from the Department of Veterans Affairs office of the inspector general, the federal government has declined to prosecute two executives for fraudulently obtaining relocation expenses.

The U.S. Attorney’s Office for the District of Columbia said Thursday that it would not be pursuing any action against executives Diana Rubens and Kimberly Graves, instead opting to refer the matter back to the VA for any administrative action deemed appropriate, The Associated Press reports.

[dcquiz] An inspector general report found that Rubens and Graves obtained over $400,000 in relocation expenses, which they received after pushing subordinates out of positions, so that the two could then fill them, reduce their job responsibilities, collect bonus money and receive the same executive-level salaries. At a House Veterans’ Affairs hearing on the matter, both Rubens and Graves pled the Fifth Amendment and declined to answer any questions from Chairman GOP Rep. Jeff Miller.

The VA recently attempted to demote the two executives to general employee status, though the department failed to accomplish that plan because VA counsel forgot to provide Rubens and Graves with a binder of evidence. The VA said it will restart the process and continue with the demotions, though it will not seek to recover any of the fraudulently obtained funds from the executives.

VA Deputy Secretary Sloan Gibson recently said that while Graves and Rubens exercised bad judgment, they did not engage in any wrongdoing.

“In my opinion, the evidence collected by the IG does not support one violation of law. Not one violation of rule. Not even one violation of regulation related to relocation expenses,” Gibson said.

Gibson delivered those remarks despite the fact that Graves and Rubens fiddled with the hiring system and put major pressure on subordinates to vacate those positions and rearrange their lives, so that the two could insert themselves into the positions.

Rep. Miller was stunned at Gibson’s analysis of the situation, saying that the inspector general report reveals far more than just terrible judgment. For Miller, allowing Graves and Rubens to keep the relocation funds is like letting bank robbers keep stolen money.

Graves is scheduled for a transfer to the Phoenix VA, perhaps the most troubled facility in the entire nation, and the one which set off the waitlist scandal last year.

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