Harriette Walters, the accused mastermind of the largest public corruption scandal in D.C. history, was warned by her bosses a few months before her arrest to stop lavishing gifts on her co-workers and superiors, The Examiner has learned.
Walters and fellow ex-tax office employee Diane Gustus are charged with stealing tens of millions of dollars through a phony refund scam.
The 51-year-old Walters was known as “Mother Harriette” in her office — the woman to see for emergency loans, designer clothes and accessories, even floor-level Wizards tickets, three sources with direct knowledge of the widening federal and local investigations said.
She also paid out large cash rewards, in increments of up to $20,000 at a time, to fellow workers who helped her edit and complete her paperwork, sources said. Her annual salary was $81,000.
Shegave out portable safes to her co-workers to stow the goodies, one source familiar with the investigation said.
According the source, a few months before her Nov. 7 arrest, Walters was called into a meeting with Terez Badger, a chief in the tax office, and Susan Lee, a deputy chief and Walter’s direct supervisor. They told her to stop giving out the presents and taking her co-workers on shopping sprees.
Lee and Badger have both resigned, finance office spokeswoman Natalie Wilson. They couldn’t be reached for comment.
Fifteen people, including the director of the tax office, have been sacked or resigned since the scandal became public.
But some officials say the firings are only cosmetic. Up to five supervisors in the tax office received gifts from Walters, the source said.
District Council Member Tommy Wells, D-Ward 6, told The Examiner Tuesday that he was worried that Walters’ largesse fomented “a climate of corruption” in the tax office. He said he wanted to subpoena numerous tax officials — especially those who voluntarily resigned in the wake of the scandal.
“It remains to be seen whether the supervisors and the other gift recipients broke laws,” Wells said. “But they certainly compromised the public trust.”
Gustus’ lawyer, A. Scott Bolden, told The Examiner that the revelations buttress his client’s claims of innocence.
“It leaves a lot of questions as to why Diane Gustus is under arrest. There were a lot people getting gifts,” he said. “If she signed something a manager brought her and it was fraudulent, she didn’t do her job. That doesn’t make her a criminal.”
Got a tip on the finance office scandal? Call Bill Myers at 202-4594-596 or send an e-mail, [email protected].
