State Department Probes Possible Embassy Construction Bribes

The State Department’s internal watchdog is investigating a possible bribery scheme involving a department employee who was allegedly paid by a construction company for inside information that helped it win contracts to build U.S. embassies and consulates.

The probe by the State Department’s inspector general was disclosed in a federal court filing unsealed in Washington on Thursday. An employee in the department’s Overseas Building Operations division was paid to commit “corporate espionage against the Government” from roughly 2014 to 2017, according to the document.

During that period, the construction company, Montage Inc., won six State Department contracts worth a total of roughly $100 million to build embassies and consulates overseas, according to the court filing. Montage has worked on State Department construction projects in Ecuador, Spain, Sudan, the Czech Republic and Bermuda, the document shows.

A Montage executive mentioned in the court filing didn’t immediately respond to an email seeking comment on LinkedIn. A Washington lawyer who represented the company in a 2020 contract dispute didn’t immediately return a call or email sent after hours. A woman answering the phone at a number linked to Montage declined to comment after saying she didn’t know anything about the allegations. She wouldn’t provide her name.

The State Department didn’t immediately respond to requests for comment. The department employee also didn’t respond to a call from Bloomberg News.

One part of the scheme outlined in the court filing involved a State Department contract in the Caribbean. After Montage emerged as the lowest bidder, the filing shows, the department employee informed the company that it could increase its cost estimate by $300,000 and still win the contract. Montage agreed to pay a $60,000 kickback to the employee in exchange for the information, according to the filing.

The department watchdog also is investigating Montage for a “wide range of fraudulent practices,” including misrepresentations about its ownership and its qualifications for completing construction projects, the court document shows.

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