Food Assistance:

Efforts to Control Fraud and Abuse in the Child and Adult Care Food Program Should be Strengthened

RCED-00-12: Published: Nov 24, 1999. Publicly Released: Nov 24, 1999.

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GAO reviewed the Food and Nutrition Service's (FNS) efforts to control the fraud and abuses occurring in its state administered Child and Adult Care Food Program, focusing on: (1) the extent to which the states have implemented required and recommended controls to prevent and detect fraud and abuse; and (2) FNS' effectiveness in directing the states' efforts to implement these controls.

GAO noted that: (1) almost all of the state agencies reported they had implemented, at least in part, FNS' minimum required controls for detecting fraud and abuse in the Child and Adult Care Food Program; (2) these agencies, however, reported variation in implementing the additional controls recommended by the Inspector General and task force; (3) state agencies cited factors that made it difficult to strengthen controls over fraud and abuse, including: (a) a lack of resources (staff, funding, or computer technology); (b) a lack of training in and knowledge of how to identify fraud and abuse; and (c) unclear regulations by FNS on removing noncompliant sponsors from the program; (4) according to FNS and state officials, state agencies may be reluctant to adopt additional fraud and abuse controls because they view themselves as providers of program benefits, not policing organizations; (5) FNS has not effectively directed the states' efforts to protect against fraud and abuse in this program; (6) it has yet to strengthen the minimum requirements for the states' controls over fraud and abuse, despite recommendations from the Inspector General and federal-state task force dating back to 1995; (7) this has contributed to many states not implementing the types of controls necessary to reduce the program's vulnerability to illegal or inappropriate uses of federal funds; (8) FNS has not adequately monitored the states' implementation of controls over fraud and abuse and has little basis for identifying and correcting problems that the states may be experiencing; (9) FNS has had difficulty correcting problems involving the states' compliance with required controls, partially because it lacks an appropriate range of sanctions; (10) agency officials told GAO that these oversight weaknesses largely resulted from insufficient resources, noting that in the past few years, the agency needed to concentrate many of its resources on implementing changes required by welfare reform; (11) beginning in fiscal year 1999, Congress authorized an additional $1 million annually for 5 years to strengthen the agency's efforts in preventing and detecting fraud and abuse in the food program; and (12) FNS has initiated but not completed actions to address these problems.

Recommendation for Executive Action

  1. Status: Closed - Implemented

    Comments: In June 2000, the Congress enacted a variety of statutory requirements intended to reduce the potential for fraud and abuse in one of the nation's largest food assistance programs, the $1.5 billion Child and Adult Care Food Program (CACFP). Many of these requirements were drawn from GAO's November 1999 report and the USDA Inspector General's September 1999 report. For example, the report provided previously unavailable information about how states vary in using a number of techniques that have been proven effective in identifying fraud and abuse in the program. GAO also described the obstacles that states said they faced in adopting these additional controls. Moreover, GAO found that USDA had not been effective in overseeing states' efforts to address known problems in this program and was still experiencing delays in requiring states to use the proven anti-fraud controls. In response to these reports, the Congress statutorily required the implementation of many of these proven controls and took steps to strengthen USDA's oversight of states efforts.

    Recommendation: To reduce the Child and Adult Care Food Program's vulnerability to fraud and abuse, the Secretary of Agriculture should direct the Administrator, FNS, to develop and implement a comprehensive plan for strengthening state controls for detecting and preventing fraud and abuse. The plan should identify actions that the agency needs to take and include measurable goals and objectives for each action. These actions should include, but not be limited to: (1) expediting the issuance of regulations strengthening the minimum requirements for the states' controls over fraud and abuse; (2) developing a systematic means of monitoring the states' compliance with minimum requirements; (3) examining ways to address difficulties the states face in implementing strong program controls (such as unclear federal guidance and inadequate training); and (4) exploring alternative types of sanctions that could be invoked in cases of noncompliance. Furthermore, as part of the plan, FNS should examine measures for evaluating the success or failure of the combined actions it carries out in terms of their ultimate impact on the level of fraud and abuse in the program.

    Agency Affected: Department of Agriculture


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