Ex-Nellis officer gets $1 million for revealing contract scam

A former Nellis Air Force Base officer was awarded nearly $1 million this month for blowing the whistle on a contract-steering scam involving a middleman in Florida and an engineering company hired to develop anti-terrorism techniques for a now-defunct warfare unit at the base.

Court papers unsealed July 3 by U.S. District Court in Tampa, Fla., show that Lt. Col. Tim Ferner suspected the scam in 2007 when his superiors at the Coalition and Irregular Warfare Center downplayed his concerns about how contracts were being doled out from a $4.7 million account to develop ways to defeat improvised explosive devices.

The company at the receiving end, Science Applications International Corp., or SAIC, agreed to pay the government $5.75 million to settle allegations that it circumvented the bidding process to obtain lucrative contracts.

The settlement and a $977,500 award to Ferner under the False Claims Act were revealed by the Department of Justice and Ferner’s lawyer in Tampa when the complaint against the middleman, Steve R. Stallings, and SAIC was unsealed.

The Department of Justice said the claims resolved by the settlement “are allegations only and there has been no determination of liability.”

SAIC was once part of consortium that performed contract work for the Department of Energy’s Yucca Mountain nuclear waste project in Nevada.

Ferner, who is now retired and living in New Zealand, was the Coalition and Irregular Warfare Center’s chief of staff from 2007 until 2009. He became suspicious that the base’s contracting office was being bypassed and little or no work was being performed under contracts handled for SAIC by Stallings, a retired Air Force lieutenant colonel.

Stallings “claimed to be a high-ranking government official who had authority to bypass the bidding process, none of which was true,” according to Ferner’s attorneys at James Hoyer Law Firm in Tampa.

Ferner “was alarmed that his military supervisors condoned and wanted to cover up the violation,” the law firm said in a news release.

Several officers who worked at Nellis are mentioned in the complaint including Col. Scott Pugmire, former director of the Coalition and Irregular Warfare Center; Ferner’s “boss,” Col. Ross Victor; Capt. Daniel Boeh, of the base contracting office; and Lt. Col. Ted Anderson, of the 505th Command and Control Wing, which is based at Hurlburt Field, Fla., but has a subordinate unit at the Air Force Warfare Center at Nellis.

Nellis public affairs officials fielded a Review-Journal query seeking their duty status and any actions taken against them but the answers were not provided Friday. Likewise five questions about work performed under the SAIC contract and accountability at the Coalition and Irregular Warfare Center went unanswered.

Ferner believes the revolving door between military leaders and government contractors contributed to the atmosphere that made this waste and abuse possible, the law firm’s release says. It quotes Ferner, saying, “If you keep your mouth shut, you can set yourself up for a high paying job at one of these giant, defense contract companies — especially when you’re close to retirement.

“We call them ‘ROADY’s: Retired on Active Duty. Don’t make waves. Just coast until you retire and you’re all set,” Ferner is quoted as saying.

His concerns surfaced at a time when the contract award culture was ripe for abuse. An inspector general’s report in 2008 found that owners of a company in line for a $50 million, five-year public relations contract to develop “Thundervision” had a close relationship with Air Force officers. They included Maj. Gen. Stephen Goldfein, who was commander of the Air Force Warfare Center at Nellis.

The “Thundervision” contract — to produce Jumbotron video boards to entertain spectators during lulls in air shows — was canceled in 2006. As a result of the IG probe, Goldfein and two Air Force colonels received career-ending reprimands, and two others also received administrative punishments.

According to the complaint in the SAIC case, before Victor fired him in 2009, Ferner told the Office of Special Investigation and the Defense Criminal Investigative Service that he thought Stallings, SAIC, and Lawrence Solliday, director of another broker-entity in Crane, Ind., were engaged in contract fraud.

Pentagon investigators determined that Stallings had misrepresented himself as a government employee to obtain millions of dollars in government contracts for SAIC.

“The contracts were worldwide in scope and encompassed various military units including the U.S. Special Operations Command and U.S. Central Command at MacDill Air Force Base ... and the National Aeronautics and Space Administration at Cape Canaveral, Fla,” the complaint states.

Ferner’s attorneys couldn’t make him available for an interview because part of the case is still under investigation. It’s unclear what, if any, penalties or prosecutions will result from the probe.

According to the law firm, when Ferner expressed concerns up the chain of command, “his efforts to expose the wrongdoing were rebuffed. He was told to keep quiet. When he wouldn’t, he eventually faced retaliation.

“His superiors threatened to deploy him to Afghanistan while he was undergoing cancer treatment,” the law firm’s release says.

“I didn’t know if I was going to die when I had cancer, but I wasn’t going to allow my name to be tarnished and potentially associated with this fraud,” Ferner said.

His attorney, Elaine Stromgren, said Ferner experienced “a frustrating and life changing ordeal.”

“We salute his effort to expose wrongdoing, even though it put his career on the line by bucking the chain of command,” she said.

Contact reporter Keith Rogers at krogers@reviewjournal.com or 702-383-0308.