Colonel Charles R. Forbes, a chance acquaintance of Warren Harding, was appointed to head the recently created Veterans' Bureau. It was later revealed that Forbes entered into corrupt arrangements with a number of contractors, particularly with those involved in the operation of hospitals, and sold government property at a fraction of its value. Charles F. Cramer, attorney for the bureau, committed suicide, which brought increased attention to the agency. In 1923, Forbes resigned his position and fled to Europe.
A Senate investigation in 1924 found that Forbes had looted more than $200 million from the government. He was subsequently indicted for bribery and corruption, and was brought back for trial in 1925. He was convicted, fined $10,000 and sentenced to two years in Leavenworth.