Subpoenas issued in Cover Oregon investigation

Subpoenas issued in Cover Oregon investigation »Play Video

The federal probe into possible wrongdoing at Cover Oregon took another step forward this week when a grand jury issued subpoenas to the troubled organization.

Sources tell KATU that the subpoenas were issued by a sitting grand jury as opposed to a special grand jury convened to focus on Cover Oregon.

What that means, sources say, is that the FBI's initial investigation - being conducted by agents in its white collar crimes squad - has concluded that there is something worth looking into further.

Sources caution that the subpoenas – which were issued May 13 – do not mean there is a full-blown investigation.

KATU was the first to report that FBI agents were looking into allegations that Cover Oregon misrepresented the work they were doing to obtain federal grants.

Sources tell KATU that the bureau has at least two agents - one of whom is a forensic accounting specialist – working on the case.

“The agencies take this request seriously and will cooperate fully with federal officials. We will work collaboratively with the US Attorney’s Office to provide any and all information we have and make any and all staff available to assist," Cover Oregon officials said in a statement.

In response to the subpoenas, Oregon Gov. John Kitzhaber's office sent an email to the U.S. Attorney's office, saying it will comply with them.

"The Governor is committed to a thorough review of Cover Oregon to ensure the appropriate accountability and oversight for the public investment made in the Cover Oregon website," wrote Liani Reeves, the governor office's general counsel.

The subpoenas demand emails, memos and documents between state officials and officials at the Centers for Medicare and Medicaid Services (CMS) as well as between officials at Cover Oregon and the Oregon Health Authority.

The subpoena indicates an interest in the preparation work that was done for meetings between state officials and CMS in which the state officials were asked about the progress being made on the website that was intended to serve as a one-stop shop for people to sign up for insurance.

Oregon spent approximately $250 million on the site before pulling the plug earlier this year, choosing to join the federal exchange instead.

The subpoena asks for all "reports, memoranda, PowerPoint presentations, letters, emails" and other communications with CMS "containing information, statements, or representations about the status or functionality of the health exchange website."

The FBI also wants to see a list of everyone - including non-Cover Oregon personnel - who attended each meeting with CMS officials.

It also specifically asks for "all written communications, including reports, memoranda, e-mails, and texts, between or among: Bruce Goldberg, Rocky King, Carolyn Lawson, Steven Powell, Aaron Karjala, Beatriz delaRosa, Mike Benetto, Bob Cummings, Ying Kwong and John Cvetko."

They have also demanded documents from Exeter Systems. KATU reported in April that an Exeter employee who worked for Oracle developed a dummy website that was used to show more progress on the website than actually had been made.

The subpoena asks for any "communications in any form with Exeter Group and/or Exeter Group personal."

The FBI declined to comment.