Contract Management: DOD Vulnerabilities to Contracting Fraud, Waste, and Abuse

In recent years, the Department of Defense (DOD) has increasingly relied on goods and services provided by the private sector under contract. Since fiscal year 2000, DOD's contracting for goods and services has nearly doubled, and this trend is expected to continue. In fiscal year 2005 alone, DOD obligated nearly $270 billion on contracts for goods and services. Given the magnitude of the dollar amounts involved, it is essential that DOD acquisitions be handled in an efficient, effective, and accountable manner. In other words, DOD needs to ensure that it buys the right things, the right way. Enacted January 6, 2006, the National Defense Authorization Act for Fiscal Year 2006 required us to review DOD's efforts to identify and assess the vulnerability of its contracts to fraud, waste, and abuse. We reviewed the areas of vulnerability that DOD faces with regard to contracting fraud, waste, and abuse, and the recent initiatives that DOD has taken to address these vulnerabilities, including actions DOD has taken in response to a March 2005 Defense Science Board report on management oversight in acquisition organizations.