Congress Probes Maritime Agency for Alleged Intimidation, Covert Surveillance of Staff, Misuse of Tax Dollars

By Fred Lucas | May 24, 2012 | 2:43pm EDT

Federal Maritime Commissioner Richard A. Lidinsky Jr.

( – The House Oversight and Government Reform Committee is investigating whether the Federal Maritime Commission (FMC) politicized its mission and in the process intimidated staff workers, violated the privacy of some employees, and misused taxpayer funds.

The FMC is an independent agency responsible for regulating U.S. international ocean transportation for U.S. exporters and importers. The commission reviews contracts among carriers, resolves disputes, and seeks to address unfavorable conditions caused by foreign governments in U.S. foreign shipping, and investigates complaints.

In a May 9 letter to FMC Chairman Richard A. Lidinsky Jr., Rep. Darrell Issa (R-Calif.), chairman of the House Oversight and Government Reform Committee Chairman, wrote that the FMC “may be an agency in crisis.” He continued: “Commission insiders allege that the politicization of the Commission’s core functions and administrative decisions has contributed to a climate of fear and intimidation among agency members and staff. As you know, the Office of Special Counsel has opened an investigation into these allegations.”

The letter from Issa requested documents about covert surveillance of FMC staff computers and e-mails; information on Lidinsky’s alleged intrusion into the Freedom of Information Act process; information about Lidinsky’s possible use of a taxpayer-funded chauffer and vehicle; information on the purchase of art for the chairman’s office; and an accounting of the agency’s 50th anniversary party.

The agency has until May 29 to provide the documentation, said Oversight Committee spokeswoman Becca Watkins.

The FMC had little response at this stage of the investigation.

In an e-mal to, FMC spokeswoman Rachel E. Dickson said, “I am writing in response to your inquiry regarding the House Oversight Committee’s request to the FMC. The Commission is fully cooperating with Chairman Issa’s request and has no further comment on the matter.”

The controversy began in relation to Lidinsky’s apparent opposition to agreements with independent owner-operator truck drivers to contract with the Port of Los Angeles in favor of contracting with company-run truck drivers, “who are subject to unionization,” reads the letter from Issa.

FMC economists Roy Pearson and Robert Blair testified in federal court in 2008 that prohibiting independent owner-operator truckers from getting a contract would reduce competition and “unreasonably increase costs.”

House Oversight Committee Chairman Rep. Darrell Issa, R-Calif. (AP File Photo)

In October 2009, according to the Issa letter, Lidinsky appeared to seek retaliation against Blair and Pearson, telling their immediate supervisor Austin Schmitt to “keep an eye on them.” Lidinsky also allegedly said that Blair, a former employee of the World Shipping Council, was a “spy for the carriers” inside the agency, according to the letter.

Further, Schmidt might have faced retaliation from Lidinsky as well when he defended the two staff economists.

“On Sept. 20, 2010, Schmitt in his capacity as Blair and Pearson’s direct supervisor, gave them an adjectival performance rating of ‘Outstanding,’ and recommended they receive an annual performance award of 3 percent of base salary, the minimum amount commensurate with an ‘Outstanding’ rating under the established FMC policy,” the Issa letter states.

This would have constituted a pay increase of $3,800 for Blair and $4,200 for Pearson. But Lidinsky apparently demanded that they receive a raise of no more than $200 each, according to the House Committee. Schmitt protested and Lidinsky agreed to a 2 percent raise for Blair and Pearson.

Then Lidinsky “informed Schmitt that his department would be subjected to a ‘management survey,’” reads the letter.  “One of the staffers tasked to conduct this ‘management survey’ later resigned, in part because he believed his task was to conduct a biased investigation designed to produce predetermined conclusions and damaging information about Schmitt and others.”

After that, the agency subjected Schmitt, Blair and Pearson, as well as at least three other employees, to “covert surveillance of their computers and e-mails,” according to information obtained by the committee. The agency used software called Spector 360, which, according to the company Web site, captures all workstation activity of a monitored employee. 

(AP Photo)

“The committee has learned that the Inspector General for the FMC expressed concern about whether the agency’s use of this software violated federal privacy regulations and requested that agency management stop using it in January 2012,” the Issa letter said. “Despite this admonition, it appears agency management continued using Spector 360 against the advice of the Inspector General.”

The letter went on to inquire about “misuse of taxpayer funds.”

“For example, according to information we have received, the FMC procured an official car and chauffer used mostly to drive you [Lidinsky] from FMC headquarters to Union Station, a distance of approximately three blocks,” the Issa letter to Lidinsky states.

Further, the letter requests a “complete accounting of the agency’s purchase of any decorative or commemorative items such as painting, sculptures, works of art, furniture, or coins on behalf of the Office of the Chairman since September 11, 2009, including the total amount spent and the method of payment.”

In addition, the letter asked for a “complete accounting of the agency’s 50th Anniversary Party, including total funds expended and a break-down of funds expended by category.”

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