Federal Fraud: Government's Persistent Financial Mismanagement

Editor: Vladimir Bajic | Tactical Investor

Federal Fraud: The Ongoing Challenge of Financial Mismanagement

Updated Sept 5, 2023

The Federal Government’s financial management has been a subject of concern for many years. Despite the numerous promises made by politicians to combat fraud, waste, and abuse, the problem persists. The Government Accountability Office (GAO) has consistently reported billions of dollars in improper payments, indicating a systemic issue that needs urgent attention. This essay will delve into specific instances of fraud and negligence, illustrating the magnitude of the problem and the need for a comprehensive solution.

In 2002, the GAO reported that the Department of Defense (DoD) had made $22 billion in improper payments. This clearly indicated the lack of stringent controls and oversight in the department. The DoD’s financial management systems were deemed inadequate, leading to a high risk of fraud and waste. Despite the glaring issues, little was done to rectify the situation, and the problem persisted.

In 2007, the GAO reported that the Medicare program had made $10.8 billion in improper payments. This was due to various factors, including fraudulent billing by healthcare providers and administrative errors. The Centers for Medicare and Medicaid Services (CMS) were criticized for lacking effective oversight and control mechanisms to prevent such occurrences.

In 2010, the GAO found that the Internal Revenue Service (IRS) had issued $125 billion in improper Earned Income Tax Credit (EITC) payments over a decade. The IRS was criticized for its inability to prevent these improper payments, largely due to fraud and errors by taxpayers and tax preparers.

In 2012, a scandal involving the General Services Administration (GSA) came to light. The GSA had spent over $820,000 on a lavish conference in Las Vegas, which included luxury suites, expensive meals, and extravagant parties. This was a clear case of waste and abuse of taxpayer dollars, and it led to the resignation of the GSA administrator.

Federal Fraud: A Persistent Challenge in Government Financial Management

In 2015, the Department of Veterans Affairs (VA) was embroiled in a scandal involving long wait times for veterans seeking medical care. An investigation revealed that some VA employees had manipulated data to hide the long wait times, leading to a public outcry and calls for reform.

In 2018, the Department of Health and Human Services (HHS) was found to have made $90 billion in improper payments, primarily in the Medicare and Medicaid programs. The GAO criticized the HHS for its lack of effective controls to prevent fraud and abuse.

In 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was passed to provide financial relief to individuals and businesses affected by the COVID-19 pandemic—however, the rapid disbursement of funds led to numerous instances of fraud. The GAO reported that billions of dollars were potentially lost to fraud as criminals exploited the lack of stringent controls in the rush to provide aid.

In 2023, the GAO reported that the federal government had made $175 billion in improper payments, an increase of $38 billion from 2015. This clearly indicated that the fraud, waste, and abuse problem in the federal government was far from being resolved.

These instances illustrate the federal government’s pervasive nature of fraud and waste. They highlight the need for a comprehensive approach to combat this issue, which borrows from commercial leading practices and incorporates new methods from social science. The private sector’s experience shows that such an approach can reduce fraud, waste, and abuse. However, it requires a commitment to change and the political will to implement tough measures. The time for rhetoric is over; it’s time for action.

Fed Fraud Unveiled: Further Instances of Fiscal Mismanagement

– $85 Million Poured into an Unfinished Kabul Hotel
– A Whopping $1.04 Billion Spent on Trolley Expansion
– A Staggering $55 Billion Allocated to Preserve Obsolete Technology
– A Questionable $1.6 Billion Devoted to Unnecessary Government Vehicles
– $1.2 Million Directed towards the Study of Monkey Social Behavior. continue reading

This fraud won’t stop because some people are making out like bandits, and whenever people have access to large funds, you can bet your bottom dollar there will be some monkey business.