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B-114873 1 (1972-06-19)

handle is hein.gao/gaobabkhh0001 and id is 1 raw text is: AfoutiRsTmrD 'Not to be rWeased ev I AC o m~~~ Office excpt &n the bjaois e6 sp ene P RELASEPTROLLER GENERAL OF TH~E WASHINGTON, D.C. 2 JUN 19 1972 B-114873 (.I Dear Senator Proxmire: Pursuant to your request of February 24, 1972, we exam- ined Mr. Paul R. Wooley's contention that an investigation by the Department of Agriculture's Office of the Inspector General of his charges of fraud and misuse of Federal funds may have been incomplete. The charges were made in connec- tion with a Faqrmers Home Administration loan to extend the water system of Ru iaITWdfte-DistYict No. 2 in Okmulgee County, We examined the material enclosed with your letter, the Office of the Inspector General's investigation report, and the pertinent files and records on the project loan to deter- mine whether a detailed review by our Office would produce significant additional facts bearing on Mr. Wooley's charges. Also we interviewed officials of the Inspector General's of- fice, the Farmers Home Administration (FHA), and the Depart- ment's Office of the General Counsel. Information on the project and results of our examination follow. FHA made a loan of $136,000 to the water district in March 1966 for the construction of a water distribution sys- tem to serve farmers and rural residents near Preston, Okla- homa. The water district obtained a supplemental FHA loan of $175,000 in April 1968 to extend the water system to serve 152 additional users in Natura-Twin Hills. On January 16, 1968, the chairman and the secretary- treasurer of the water district's board of directors certi- fied to FHA that, with the 144 users of the original system, the water district had a total of 296 users who had signed water users' agreements. The Inspector General's office investigated the project loan at the request of the U.S. Attorney, Eastern District of Oklahoma, who had received complaints of irregularities re- garding the water district from Mr. Wooley and two other per- sons representing a group of the water district's users. The complaints included:

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