Reed, Inhofe Comment on Balfour Beatty Communities Guilty Plea in Military Housing Fraud Case

U.S. Senators Jack Reed (D-RI) and Jim Inhofe (R-OK), chairman and ranking member of the Senate Armed Services Committee, today released the following statement after the Department of Justice announced that Balfour Beatty Communities LLC pled guilty to one count of major fraud against the United States government for actions in which it engaged as part of the privatized housing program for the Air Force, Army, and Navy, and that it was sentenced to pay over $65 million in criminal fines and restitution.

“After more than a year of criminal and civil investigations, we are pleased that justice will be served on behalf of our troops and their families. Not only was Balfour Beatty Communities defrauding the government of taxpayer money, but it was also cheating service members out of quality housing — harming morale and readiness. We hope the restitution paid by Balfour Beatty will make a meaningful step in the right direction — but housing companies and the services they provide still have a ways to go to restore trust with our service members and their families. We encourage the Department of Justice to continue to pursue criminal charges against any individuals who took part in this scheme, or any other scheme that defrauds our military at the expense of military families. Finally, let this serve as a warning to any company that chooses fraudulent financial profits over military families. The Senate Armed Services Committee, which led the way almost three years ago when this crisis first came to light, will be standing by to continue our oversight role, and as its leaders, we will continue to do our part to ensure this never happens again.”

Background: Sens. Reed and Inhofe, as the bipartisan leadership of the Senate Armed Services Committee, have been leading voices against allegations of substandard treatment on the part of housing companies within the Military Housing Privatization Initiative. Beginning in February 2019, after brave military families sounded the alarm about the poor conditions of military privatized housing, the Senate Armed Services Committee held numerous hearings to shed light on the situation. The Inhofe/Reed-led FY 2020 National Defense Authorization Act enacted historic reforms to the privatized housing program, including specific policies to put an end to fraudulent work order practices, including: strengthening transparency by requiring each contractor to provide the housing management office at each installation access to their maintenance work order system, providing recourse against companies that fail to remedy health or environmental hazards in a timely manner, and prohibiting any employee who has committed work order fraud under the contract from continuing to work under the contract. Since then, Sens. Reed and Inhofe have spoken out regularly about these allegations — including in July 2019November 2019 and June 2021.