The DEA Looks Like a Total Mess Right Now

Multiple senior officials with the Drug Enforcement Administration are facing questions about the agency’s awarding of lucrative contracts to sole-source bidders, the latest scandal to rock the DEA as it faces continued scrutiny from Congress.

DEA sources tell VICE News that at least seven individuals in the agency’s top ranks have been contacted by the Justice Department’s Office of the Inspector General (OIG) in connection with an investigation into potential procurement fraud, which if substantiated can lead to consequences that range from administrative sanctions to criminal charges. One person familiar with the OIG investigation characterized it as an “administrative review,” not a criminal case.

A handful of officials have already left the DEA or taken new positions amid the investigation and further turnover is expected in the coming months, said the sources, who requested anonymity because the probe is ongoing and they are not authorized to speak publicly.

“By early summer, there will be a house clearing,” one person said. 

The DEA’s press office received an inquiry from VICE News but did not provide direct responses to questions on the matter. A spokesperson for the DOJ OIG said, “It is our general practice not to confirm or deny the existence of any ongoing investigation.”

Details of the contracting inquiry were first reported Wednesday by the Associated Press, which said that at least a dozen people have been hired by the DEA with sole-source contracts under Administrator Anne Milgram, the agency’s top official. The 52-year-old Milgram took over the DEA after receiving a nomination from President Joe Biden in April 2021. VICE News has spoken with multiple current and former federal law enforcement officials about Milgram’s polarizing leadership style, which has included relying on outsiders to the chagrin of some of the agency’s rank and file.

Those hired under the disputed contracts reportedly come from Milgram’s “inner circle handling intelligence, data analytics, community outreach and public relations,” according to the AP. The deals reportedly include $4.7 million for “strategic planning and communication” to hire people Milgram knew from her days as New Jersey’s attorney general, and $1.4 million to a law firm that conducted a review of the DEA’s foreign operations and ultimately downplayed a spate of scandals.

The DEA pushed back on some of the reporting, with the agency telling VICE News that the communications contract started in 2020, predating Milgram’s arrival at the agency, and denying that the administrator knew any of the contractors in that deal from her time as New Jersey AG.

VICE News sources confirmed the AP’s reporting, and said a third facet of the OIG investigation involves a contractor hired to vet the DEA’s cases, a hiring that rankled the DEA’s mid-level management and prompted whistleblowers to step forward. The contractor, Jose Cordero, is said to have had a prior working relationship with Milgram from the Attorney General’s office in New Jersey. His firm, the Cordero Group, describes itself as “a trusted and respected firm specializing in public safety and security consulting and technology,” which provides, “highly effective data-driven solutions to public safety and security problems.”

The company did not immediately respond to messages seeking comment from Cordero.

Milgram and Cordero’s professional relationship dates back to 2007, according to the AP, when as attorney general she named him New Jersey’s first statewide director of gangs, guns and violent crime, and they worked together to successfully lower the homicide rate in the city of Camden. Less than three weeks after Milgram became the DEA’s chief, the AP reported, the agency gave Cordero what has become a nearly $400,000 contract.

“She gave him or ordered him to be given a sole-source contract to vet potential investigations,” one source told VICE News, explaining that the arrangement raised eyebrows with the DEA’s special agents in charge or SACs, which are regional bosses. “Some of them turned her in to the OIG.”

The DEA declined to let the AP reporters interview Milgram, but issued a statement that said the agency “has acted with urgency to set a new vision, target the global criminal networks responsible for hundreds of thousands of American deaths, raise public awareness about how just one pill can kill, and promote and recruit hundreds of highly talented people.” 

“These changes have been made through an extensive and multi-part process, and we are committed to ensuring that DEA is working relentlessly to protect the national security, safety, and health of the American people,” the statement said.

Milgram has kept her job amid the inquiry, and appeared last Friday alongside Attorney General Merrick Garland and other top DOJ officials announcing indictments against Los Chapitos, the sons of ex-Sinaloa Cartel leader Joaquín “El Chapo” Guzmán.

There has been a reshuffling atop the DEA in recent months, with the agency’s chief financial officer departing and the previous chief of staff getting replaced by Saritha Komatireddy, the lead federal prosecutor in the high-profile trial of former Mexican security official Genaro García Luna.

VICE News previously reported on the case of Nick Palmeri, a former top DEA official in Mexico who quietly retired last year amid investigations into his alleged misconduct, including improper meetings with defense attorneys who represent cartel members and requesting government funds to help cover expenses at a lavish birthday bash that featured a mariachi band. Palmeri has denied any wrongdoing and challenged the DEA’s handling of his dismissal before a board that adjudicates labor disputes.

The Palmeri case was among the litany of problematic incidents that were either ignored or glossed over in the DEA’s “Foreign Operations Review,” published in late March. The review, co-authored by a former DEA chief and an ex-federal prosecutor, is now drawing scrutiny from Iowa Republican Sen. Chuck Grassley, according to a copy of a letter sent from Grassley’s office to report author Boyd Johnson and obtained by VICE News.

The Grassley letter, also reported by the AP, said the senator is seeking information about "a sole-source contract" awarded to the law firm WilmerHale by the DEA, which "sidestepped" the competitive bidding process "by arguing that 'the threat of illicit foreign drugs' demanded an expedited review that only WilmerHale could perform within the necessary six months." 

The total spent on the report is estimated to be $1.35 million, Grassley’s letter said, noting that the resulting final product “spends much of its 49 pages quoting from publicly-available documents that one could have pulled off a web site or out of the DEA's operating manuals." 

Grassley requested an “unedited and unredacted” version of the report, delivered “before the DEA made any edits to it,” and inquired whether Johnson has ever had “a personal friendship or other personal connection, through family or otherwise, with Ms. Anne Milgram.”

Johnson and spokespersons for WilmerHale, where he is a partner, did not immediately respond to a request for comment from VICE News.

The AP described Johnson as a former right-hand man to one of Milgram’s closest friends, Preet Bharara, the former U.S. Attorney in Manhattan, who joined WilmerHale as the foreign operations review was being conducted. Earlier this year, according to the AP, Milgram hired her former NYU research assistant away from WilmerHale to serve as her deputy chief of staff.

The report’s other co-author was Jack Lawn, a former top anti-drug official in the Reagan administration. A person who answered the phone at Lawn’s home said he was not available to comment.

Grassley, who is also investigating the DEA’s relationship with García Luna, slammed the report after its publication.

“For spending two years and nearly $1.5 million in tax dollars on a so-called independent review, this report is stunningly vague in its actual evaluation of known problems at the DEA and remedies to fix them,” Grassley said. “This speaks to the agency’s broader effort to evade oversight.”

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