GAO Efforts Related to the Problem of Fraud in the Government

Information was provided on GAO efforts to prevent fraud in Government programs. It was determined that the essential elements of an effort to combat fraud should include: (1) procedures to assess the vulnerability of the programs in question to see if the agencies were aware of the susceptibility of their programs to fraudulent schemes; (2) the comprehensive collection and analysis of information on known incidents of fraud to determine patterns and trends; and (3) an aggressive effort to followup on instances of fraud which would involve not only reactions, but active policing to seek out fraudulent schemes. In January 1979, as a response to the problem of fraud in Government programs, GAO established a Special Task Force for the Prevention of Fraud. The Task Force's assignment was threefold: first, to establish the scope of the overall problem; second, to develop, on an agency-by-agency basis, a risk profile of the susceptibility of agency programs to fraud and other illegal activities; and third, to operate a nationwide toll-free hotline which can be used by citizens anywhere in the country to report instances of fraud in Federal programs. The Task Force was still in the process of implementing the three aspects of its mission; however, some comments could be made on its progress to date. The Task Force encountered a major problem in establishing the scope of the overall problem because Federal agencies do not all identify fraud the same way. In order to remedy this situation, the Justice Department was consulted in an effort to establish a standard definition of fraud that could be used by all Federal agencies. Work at four agencies selected for vulnerability assessment was in different stages. To date, the assessment had revealed inadequate internal controls over both administrative and program functions. Plans were underway to develop and issue a standard audit package to the heads of all departments and agencies for their use in evaluating their own internal control systems. By October 15 the nationwide fraud hotline had produced over 6,800 allegations. These were classified, computer analysis of them was complete, and the followup process had begun. GAO planned to report periodically to the Congress on the progress of these efforts.