Fraud can be difficult to detect and even when potentially fraudulent activity is detected. Image: Olivier Le Moal/Shutterstock.com
By: FEDweek StaffGAO has said there is no reliable accounting of how much fraud against agency programs is occurring, partly due to a lack of data but also due to differing views among agencies about what constitutes fraud.
“Reliably determining the extent of fraud – both frequency and impacts – in all federal programs could help Congress and agency officials prioritize fraud prevention and detection resources,” says a white paper. “Various entities report data that provide insights into the extent of federal fraud. However, differing methodologies, incomplete data, and inconsistent reporting mean that these figures cannot be added to determine total fraud.”
It said for example that the central IG council reports annually on recoveries and receivables from investigations—the 2021 figure was $12.1 billion—but those numbers also include the impact of potential crimes such as theft. Similarly, the $4.5 billion reported as confirmed fraud in 2021 on paymentaccuracy.gov “may not include all confirmed fraud data.”
Fraud can be difficult to detect and even when potentially fraudulent activity is detected, “it may be difficult to determine intent, which is a key component of fraud. For example, improper payments may reflect errors made without the intent to defraud,” it said, and activities such as fraudulently obtaining a passport or Social Security number are not accounted for in reports that focus only on direct financial impact.
GAO noted that it defines fraud as “the act of obtaining something of value through willful misrepresentation, which is determined through a court or other adjudicative system.” However, other entities also include settlements, suspected fraud, or prevented fraud that “can result in different reported fraud amounts, which could prevent comparison and summary across agencies.”
It recommended improving detection, enhancing data collection and using consistent definitions in reporting.
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