Energy Dept. executive accused of fraud

A former Department of Energy executive and his wife have been indicted for allegedly defrauding the federal government of more than $1 million by secretly causing the department to award contracts that benefitted them personally.

Michael Strayer, 69, and his wife, 48-year-old Karen Earle, were indicted in federal court in Greenbelt on charges of conspiracy to defraud the United States, wire fraud, money laundering and other offenses.

Prosecutors allege that Strayer, a member of the Senior Executive Service for the department, used funds he controlled to start a magazine called SciDAC Review to promote his division’s advanced computing work in 2004. In 2006, he allegedly directed the Review’s publisher to hire Earle as a consultant and he began a romantic relationship with her.

Strayer gave a foreign publishing company a no-bid, non-competitive contract to put together Review issues, and the publisher was reimbursed for its production costs, according to prosecutors and the indictment. In 2007, Strayer allegedly ordered the publisher to contract with Earle’s company, KJE Science Consultants, which was paid nearly $100,000 per quarterly issue to obtain articles. Strayer had arranged for Earle’s company to be provided with those articles for free by laboratory employees he had control over, prosecutors said.

In 2009, Strayer recused himself from matters involving Earle and KJE Consultants, but continued to meet with Earle and publishing officials about subcontracting agreements, authorities said. He concealed his involvement from Energy Department personnel and falsely led publishing company officials to believe the department knew about his relationship with Earle, according to prosecutors.

In total, prosecutors say, the publisher paid Earle more than $1.2 million in consulting fees and subcontract payments using the Energy Department money that funded the Review.

“This case illustrates the harm that may result when a government official’s judgment about how to spend taxpayer money is influenced by his personal financial interest,” U.S. Attorney for Maryland Rod Rosenstein said in a statement.

Strayer joined the Department of Energy in 2004, according to the indictment. As of Thursday afternoon, he was no longer working there, according to the department. 

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