NCJ Number
59157
Date Published
1979
Length
26 pages
Annotation
THE DEPUTY ATTORNEY GENERAL OF THE UNITED STATES INFORMED THE SENATE COMMITTEE ON THE BUDGET OF THE EXTENT OF, AND SOLUTIONS TO, FRAUD, ABUSE, AND MISMANAGEMENT IN FEDERAL PROGRAMS.
Abstract
THE COST OF FRAUD AND ABUSE IN FEDERAL PROGRAMS IS UNKNOWN, BUT ESTIMATES FROM THE CRIMINAL DIVISION OF THE U.S. DEPARTMENT OF JUSTICE RANGE FROM 1 TO 10 PERCENT OF FEDERAL EXPENDITURES. IN PROGRAMS OF THE DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE FRAUD AND WASTE MAY ACCOUNT FOR LOSSES OF $6.3 TO $7.4 BILLION. MAJOR CAUSES OF FRAUD AND ABUSE, IN ADDITION TO INDIVIDUAL GREED, INCLUDE THE IMPLEMENTATION OF PROGRAMS WITHOUT SUFFICIENT SUPPORT OF THE AGENCIES RESPONSIBLE FOR THEIR ENFORCEMENT, THE IMPLEMENTATION OF REGULATIONS THAT RELY ON NONGOVERNMENT ENFORCEMENT, THE LACK OF COMPLIANCE REVIEW BY GOVERNMENT AGENCIES, AND THE UNDERUTILIZATION OF ADMINISTRATIVE SANCTIONS. CRIME IS MOST PREVALENT IN PROGRAMS WITH LARGE NUMBERS OF PARTICIPANTS, DISPERSED ADMINISTRATION, MINIMUM AUDITS, AND RELIANCE ON PRIVATE INSTITUTIONS. THESE CONDITIONS EXIST IN THE FOOD STAMP PROGRAM, UNEMPLOYMENT INSURANCE, MEDICARE, AND STUDENT LOAN PROGRAMS. SIGNIFICANT PROBLEMS ALSO EXIST IN FEDERAL PROCUREMENT BY THE DEPARTMENT OF DEFENSE AND THE GENERAL SERVICES ADMINISTRATION. THE DEPARTMENT OF JUSTICE IS FORMING A GROUP MADE UP OF THE INSPECTORS GENERAL, THE OFFICE OF MANAGEMENT AND BUDGET, AND THE FBI, TO DEVELOP COORDINATED AUDIT AND INVESTIGATION STRATEGIES. ECONOMIC CRIME ENFORCEMENT UNITS WILL DIRECT INVESTIGATIONS AND PROSECUTIONS THROUGH THE U.S. ATTORNEYS' OFFICES. CURRENTLY, THE NUMBER OF WHITE COLLAR CRIME CASES FILED BY THE JUSTICE DEPARTMENT HAS INCREASED BY 13 PERCENT FROM 1974 TO 1979, AND THE CONVICTION RATE HAS INCREASED BY 18 PERCENT. TABULAR DATA ARE PROVIDED ON THE NUMBER OF CASES AND THEIR DISPOSITION AND THE AMOUNTS RECOVERED BY THE CIVIL DIVISION UNDER THE FALSE CLAIMS ACT. (TWK)