An April 2024 report by the Government Accountability Office (GAO) has exposed staggering losses to federal government fraud, contradicting mainstream media claims that there is no “proof” of widespread fraud in federal spending.
The GAO’s findings estimate annual fraud losses between $233 billion and $521 billion.
The GAO report, released last year, provides a government-wide estimate of fraud losses. Using data from fiscal years 2018 through 2022, the report found that no area of the federal government is immune to fraud, with losses ranging from 3% to 7% of average federal obligations.
The study utilized a probabilistic model informed by investigative data, Inspector General reports, and confirmed fraud cases reported to the Office of Management and Budget (OMB).
“The federal government could lose between $233 billion and $521 billion annually to fraud,” the GAO stated, emphasizing that these losses represent a significant drain on taxpayer dollars. The report also highlighted that the upper range of the estimate reflects higher-risk environments, such as those seen during the COVID-19 pandemic.
The GAO’s report directly contradicts claims by The New York Times and other outlets that there is no evidence to support “sweeping claims” of fraud in federal spending.
The White House accused these media organizations of downplaying the issue despite the availability of publicly accessible data and reports like the GAO’s.
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“Apparently, The New York Times and other like-minded outlets lack access to a newfangled research tool called Google,” quipped the White House in an emailed statement. “President Trump is determined to be a good steward of taxpayer dollars and put an end to fraudulent and wasteful spending.”
The GAO report also identified significant challenges in estimating and combating fraud, including limited data availability, varying definitions of fraud, and a lack of expertise in fraud risk management.
However, the report emphasized that fraud estimation can play a critical role in improving oversight and prioritizing anti-fraud efforts.
“Fraud estimation provides opportunities to improve fraud risk management,” the GAO stated. “With a better understanding of the costs, agencies will be better positioned to manage the risk.”
The report recommended that federal agencies enhance their data collection and reporting practices to support more accurate fraud estimates. It also highlighted the role of the Department of the Treasury’s Office of Payment Integrity (OPI) in providing expertise and tools to help agencies combat fraud.
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