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U.S. Labor Department opens review of CareerSource agencies

Labor Secretary Alexander Acosta. [Associated Press]
Labor Secretary Alexander Acosta. [Associated Press]
Published Feb. 2, 2018

The U.S. Department of Labor has launched a review of two bay-area career centers already under scrutiny from state officials to determine if they improperly reported job placements.

The announcement comes a day after U.S. Sens. Marco Rubio and Bill Nelson jointly issued a bipartisan letter requesting an investigation. U.S. Rep. Charlie Crist, D-St. Petersburg, also asked the agency to intervene.

The Florida Department of Economic Opportunity launched an investigation two weeks ago, days after the Tampa Bay Times asked about whether job placements at CareerSource Pinellas and Career Source Tampa Bay were overstated. In a response letter to Florida's senators, Labor Secretary Alexander Acosta said his department is already assisting the DEO investigation.

"I have also referred this matter to the Departments Office of Inspector General, which has the authority to conduct an investigation, up to an including making a criminal referral to the U.S. Department of Justice," the letter stated. "In addition, I have asked the Employment and Training Administration to launch a compliance audit."

PREVIOUS COVERAGE: Nelson, Rubio want federal probe into CareerSource

The local CareerSource offices received $32 million in federal money last year to train and help people find jobs.

Investigators are trying to determine whether they overstated their success by reporting they helped put people to work who never sought their assistance. Also in question is whether the centers earned state incentive money based on exaggerated placement numbers.

The state DEO "welcomes the opportunity to coordinate with the U.S. Department of Labor and the Florida Department of Law Enforcement as a part of the investigation of CareerSource Pinellas and CareerSource Tampa Bay," DEO spokeswoman Tiffany Vause wrote in a statement. "Protecting the taxpayers' dollars and ensuring transparency and accountability in the workforce system is our highest priority."

On Thursday, the chairman of CareerSource Pinellas announced he was suspending Edward Peachey, the president and CEO of both agencies, while an ad-hoc committee of that board conducts its own review. An executive committee for the Hillsborough agency is scheduled to discuss Peachey's future at 1:30 today.

Florida has 24 regional CareerSource offices. Each is overseen by its own board of directors, whose members come from the fields of education, business and government, and from labor organizations. County commissioners must approve the board members and the agencies' budgets. But only the agencies' boards of directors, not the county commission, has the power to remove their leaders.

Both CareerSource Pinellas and CareerSource Tampa Bay receive funding through the federal Workforce Innovation and Opportunity Act.

Acosta vowed to hold people responsible if investigators uncover any abuses. He stressed that the federal money is crucial for helping Floridians find work and must be "protected from fraud and abuse."

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"We are committed to conducting a through and exhaustive review of this issue," he wrote, "and will take all appropriate action in coordination with the state DEO, as well as provide information we receive to the Inspector General should any evidence of fraud or abuse off federal resources be discovered, so that a criminal referral can be made, if appropriate."

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