The mismanagement of the program was so raw that it hadn’t completely escaped detection in Washington. A desk officer in 1957 had figured that only 12,000 tons of the first 45,000 tons had been accounted for and asked: “Who received the rest of the grain?”
No one answered his question, however, either in the Washington ICA office or at the Embassy in Peru. When a Washington auditor was finally sent to Peru, he found that no end-use checks had been made by the United States Operations Mission (USOM). He stated:
“The lone USOM auditor, a local employee, stated that USOM officials issued orders that no checks were to be made beyond the offices of the committees selling [drought aid] foods. Thus, end users were not contacted and no determination could be made as to the proper utilization of food.”
Within the State Department and the ICA no aggressive action was taken to find out whether there was any substance to the complaints of conflicts of interest, waste, and major misuse of funds. Lethargy, incompetence, excuses, and cover-up prevailed.
When Dr. Raymond C. Gibson, an employee of the Office of Education, returned from an official visit in Peru, he called attention of high officials of ICA to the activities of John R. Neale, head of the USOM in Peru, who had a large interest in a farm receiving benefits of ICA funds.
Instead of investigating Neale’s holdings, top ICA officials characterized Gibson’s complaint as “character assassination.” The officials did assign an investigator to the case but told him to “assure Neale of our belief in his integrity.”
Within a few months, the case had become known within ICA not as the Neale case, but the Gibson case. ICA started a full field background investigation of Dr. Gibson, and one official pledged to hold Dr. Gibson to “full accountability” for filing a complaint against Neale.
The ICA investigators overlooked information in the ICA files which disclosed that Neale’s family had an interest in a Peru ranch. Continued complaints finally forced ICA hearings on Neale in 1958, but even then his character witnesses included the American Ambassador to Peru, Theodore Achilles, and Rollin S. Atwood, regional director of the Office of Latin-American Operations of the ICA.
“When Achilles and Atwood appeared before the ICA hearing board as character witnesses for Neale, they seemed more concerned with the motivations of the complainants than they were with the truth of their allegation,” the report of the Hardy subcommittee stated.
“The high position of Neale and the high position of his uncritical supporters, Atwood and Achilles, somewhat cowed the investigators assigned to this case.