Kristi Noem-tied firm threatened with probe of $220M in secret government contracts

In recent days, five U.S. senators and two representatives requested documents from the Department of Homeland Security and a formal investigation into how a firm closely tied to DHS Secretary Kristi Noem ended up receiving money from a $220 million, taxpayer-funded ad campaign.

The demands came in response to a ProPublica story this month that revealed that the Republican consulting firm had been secretly working on the ads, which star Noem. The company, called the Strategy Group, has long-standing personal and business ties to Noem and her senior aides at DHS. Its CEO is married to Noem’s chief spokesperson at DHS.

Under Noem, DHS bypassed the normal competitive bidding process when awarding the contracts — allocating the majority of the money to a mysterious Delaware LLC that was created days before the deal was finalized. The Strategy Group does not appear on public documents about the deal.

“The public deserves to know that government officials are not using taxpayer dollars to enrich themselves and their friends on the backs of hardworking Americans,” four Senate Democrats on the homeland security committee wrote in a letter to the DHS inspector general. They called for the inspector general to investigate whether DHS officials had violated federal laws and contracting regulations “designed to prevent self-dealing.”

The senators who signed the letter were Ruben Gallego, D-Ariz.; Gary Peters, D-Mich.; Richard Blumenthal, D-Conn.; and Andy Kim, D-N.J. Sen. Peter Welch, D-Vt., separately sent his own letter to the inspector general.

In their own letter, Reps. Bennie Thompson and Robert Garcia — the ranking members of the House homeland security and oversight committees — demanded copies of all communications between Noem and her aides and “anyone associated with the Strategy Group” or the Delaware LLC. They wrote that they intended to investigate Noem for “lining your friends’ pockets at the taxpayer’s expense.”

Other Democrats in Congress have also criticized Noem for the ad deal. House Minority Leader Hakeem Jeffries called for Noem to resign following the ProPublica report. “This is what corruption looks like,” Rep. Jasmine Crockett said at a congressional hearing. “They’re stealing money from the American people’s pockets and depositing it into their bank accounts.”

ProPublica found that the Strategy Group’s undisclosed work for DHS included running a shoot for a recently aired ad that featured Noem on horseback at Mount Rushmore, delivering a message to immigrants. Among the firm’s ties to Noem: It played a central role in her last gubernatorial campaign in South Dakota, and it has worked closely with Noem’s top aide at DHS, Corey Lewandowski. The office funding the ad contracts is listed as the DHS Office of Public Affairs, which is run by Tricia McLaughlin; McLaughlin is married to the CEO of the Strategy Group, Ben Yoho.

Multiple federal contracting experts previously told ProPublica that the extensive ties between DHS leadership and the Strategy Group suggested major potential violations of ethics rules.

Asked about the Strategy Group’s work for DHS, McLaughlin previously told ProPublica, “I don’t know who they’re a subcontractor with, but I don’t work with them because I have a conflict of interest and I fully recused myself.” She added, “We don’t have visibility into why they were chosen.”

DHS did not address questions about the calls for an IG investigation. In a statement, the agency reiterated its response to the original story, saying that DHS does its contracting “by the book” and that the agency is not involved in the selection of subcontractors.

A spokesperson for the DHS inspector general told ProPublica that as a matter of policy, it does not confirm or deny investigations.

The Strategy Group did not respond to questions.