With millions of dollars at his disposal, Forbes hired 30,000 new workers at the Veterans' Bureau, many of whom were personal friends to Forbes. The Veterans' Bureau under Forbes was overstaffed and many appointed agents looked for means to justify their paid positions. During his tenure as director, Forbes ignored the needs of the wounded veterans. In the less than two years that Forbes held his position, he embezzled approximately $2 million, mainly in connection with the building of veterans' hospitals, from selling hospital supplies intended for the bureau, and from kickbacks from contractors. The budget for the Veterans' Bureau during his tenure was $1.3 billion in total. Forbes had rejected thousands of legitimate claims by veterans.[6]
Although 300,000 soldiers had been wounded in combat, Forbes had only allowed 47,000 claims for disability insurance, while many were denied compensation for reasons that Congress called "split hairs". Even fewer veterans received any vocational training under Forbes' direction of the bureau. According to the Charleston Gazette, Forbes toured with his contractor friends to the Pacific Coast, known as "Joy-Rides", inspecting veterans' hospital construction sites. Forbes and his contractor associates allegedly indulged in parties and drinking. Forbes and corrupt contractors developed a secret code in order to communicate insider information and ensure government contracts.[7] According to congressional testimony, in Chicago, on one of his many inspection trips, Forbes gambled and took a $5,000 bribe from contractor J. W. Thompson and E. H. Mortimer at the Drake Hotel to secure $17,000,000 in veterans' hospital construction contracts. Mortimer was the middleman man who had handed Forbes the bribe in one of the rooms at the Drake. Forbes said the $5,000 payment was a loan. Mortimer stated that Forbes had an affair with Mortimer's wife while on the inspection tours.[7] After Forbes returned from his inspection tours he began to sell hospital supplies at severely discounted prices. According to a Highbeam Business report, he sold nearly $7,000,000 of much needed hospital supplies for $600,000, a fraction of their worth.[8] Forbes was suspected of receiving kickbacks from contractors. When President Harding ordered Forbes to stop, Forbes insubordinately disobeyed and kept selling supplies.[9]
On January 24, 1923 Forbes awarded Hurley-Mason Construction a sizable contract of $1,300,000 to construct a new veterans' hospital at American Lake, near Tacoma. Forbes had resigned his vice presidency at Hurley-Mason Construction upon assuming his federal position under the Harding Administration. By January 1923, rumor was spread by Forbes's close friends that Forbes would resign from the Veterans' Bureau on June 1, 1923.[4] During the summer of 1922 on one of Forbes's "joy rides", Forbes had come back to Spokane and visited the F. Lewis Clark House while he was looking for a possible site for a veterans' hospital at Hayden Lake, Idaho. Forbes was accompanied by Dr. Stanley Rhinehart. The F. Lewis Clark House was one of the most prestigious summer homes in the Pacific Northwest;[4] it had been offered to Forbes and the Veterans' Bureau at a low cost. Colonel Forbes stayed there for several days. The Spokane division office of Hurley-Mason Construction had been closed down.[4]
[...]
Forbes was prosecuted and convicted of conspiracy to defraud the U.S. Government,
fined $10,000, and sentenced to a
prison term of two years
BNP Paribas to pay record $9B fine for dodging sanctions
Reply With Quote
Originally Posted by Don Corleone
Bookmarks