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Former FEMA official pleads guilty in $6 million case involving Gallup contract

By Ann E. Marimow,January 16, 2013

A former senior FEMA official pleaded guilty Tuesday to a conflict of interest charge involving a $6 million government contract with the Gallup Organization, the well-known polling and market research firm.

Timothy W. Cannon, the former human resources director at the Federal Emergency Management Agency, admitted to overseeing and trying to expand Gallup’s contract at the same time he was trying to get hired by the company.

The case is related to a broader civil lawsuit, in which a federal whistleblower alleges that Gallup inflated its costs estimates and work hours for three federal agencies.

According to Assistant U.S. Attorney David Johnson, Cannon was instrumental in getting FEMA to hire Gallup in 2008 to work on improving employee morale in the aftermath of Hurricane Katrina.

In spring 2008, Gallup’s CEO wrote in an e-mail to a colleague that Cannon had told him he had previously applied for a job with Gallup and “wants to do a real good job at FEMA and that maybe he would try again.”

In an April 2008 e-mail, the CEO again mentioned the possibility of hiring Cannon to a colleague and said, “We should wait of course to see if we win a big quality deal here,” according to court documents.

The next month, Cannon requested additional funding at the agency to expand Gallup’s work. He then wrote to a company employee, “I got another 500k put on the contract. Cool huh?”

Six days later, Cannon formally interviewed with Gallup and discussed a possible salary. In February 2009, according to court documents, Gallup sent Cannon an offer letter for a $175,000 position.

When Cannon, 63, announced his retirement later that month and submitted a financial disclosure report, he did not list his employment arrangement with Gallup as he was required to do. He also told an agency ethics attorney in an e-mail that he had “no current plans” for future employment.

According to prosecutors, Cannon then requested another offer letter dated after his resignation from FEMA.

In March 2009, a Gallup employee raised red flags about the propriety of hiring Cannon and said FEMA employees were speculating that it was “improper. They are pretty mad.” “This may get in the way of future business with FEMA,” the Gallup employee wrote to a co-worker, according to court documents.

Charging documents in Cannon’s case do not identify Gallup by name, but court documents in the civil case against Gallup spell out Cannon’s involvement in the contract and with the firm.

The company pulled the plug on Cannon’s employment, telling him he did not meet background check requirements, according to court documents. The company CEO later e-mailed colleagues, saying of Cannon, “This is a guy that was our sponsor at FEMA…when he was applying we broke some of the rules of the US Gov on ‘how’ we do it…so we had to let him go.”

In the courtroom Tuesday, U.S. District Judge Amy Berman Jackson noted that Cannon has been cooperating with the government. It was unclear whether she was referring to the current case or the government’s larger civil case against Gallup.

“Today’s plea resolved the Department of Justice’s allegations against a former government employee. Since these allegations and charges were not against Gallup, there is nothing Gallup can comment on in regards to this developmen,” William E. Kruse said in a statement. Kruse is vice president, Law & Associate Counsel for Gallup.

Cannon’s sentencing is set for April 9. Under federal guidelines, he faces up to six months in jail, according to the plea agreement.