GAO Team Goes Undercover to Investigate Fraud

GAO Team Goes Undercover to Investigate Fraud

In a time where waste, fraud and abuse of public funds regularly makes front-page headlines, the Government Accountability Office is doing more than just recommending policy changes — its Forensic Audits and Special Investigations unit is going undercover to find the root of the problem.

The team, which combines criminal investigators with auditors, information technology experts and other specialists, formed a year ago to strengthen what was GAO's office of special investigations and give it the ability to take a more integrated approach.

Gregory Kutz, the unit's managing director, said the move is in keeping with Comptroller General David Walker's concern about the nation's fiscal challenges and growing budget deficit.
"GAO would normally discuss policies . . . our job is to find fraud," he said.

The Forensic Audits and Special Investigations team made a splash on Capitol Hill earlier this month with its report that the Federal Emergency Management Agency gave away at least $1 billion to people who used invalid information to apply for assistance following hurricanes Katrina and Rita.

The team found that federal dollars were used to pay for everything from adult entertainment to professional football tickets and that money was allotted for properties that didn't exist. Phony addresses included a cemetery and the post office box of a prisoner.

In many instances, the investigators discovered FEMA's lack of internal controls by going undercover and receiving assistance under false pretenses. They also used data-mining techniques to discover irregularities in applications.

But the hurricanes haven't been the only thing keeping the team busy during its inaugural year.
Agents from the forensic audits unit have also gone undercover to expose weaknesses in border security, fraudulent charities in the Combined Federal Campaign, and airport security.

By year's end, Kutz will have testified dozens of times before 10 different committees and subcommittees. Currently his team totals about 60 people, but he said it could grow if the requests from Congress continue to multiply.

If the reaction from lawmakers is any indication, more requests are likely.

Senate Homeland Security and Governmental Affairs Committee Chairwoman Susan Collins, of Maine, is a fan of the Forensic Audits and Special Investigations Unit.

She's also one of the reasons the team was formed.

Last year, Collins and the committee's ranking member, Joseph Lieberman, of Conn., suggested GAO combine its forensic accountants, fraud examiners and data-mining experts to create a unit that could help Congress oversee government spending and programs.

Collins said the team has done "excellent work."

"They have worked closely with my committee on a number of significant investigations that have identified waste, fraud and abuse in key government programs to include FEMA's assistance programs in the wake of Hurricane Katrina, unauthorized premium travel by government officials and the misuse of government purchase cards," she said. "I commend David Walker for creating the unit and Greg Kutz and his team."

Likewise Rep. Michael McCaul, of Texas, who chairs the Homeland Security subcommittee that received the latest Katrina report, said he was impressed with the team's work.

"I thought they did an extraordinary job," he told Federal Times. "When it comes to oversight and investigation, it's extremely valuable for members of Congress to be able to rely on professional federal investigators who can go undercover to expose fraud."

McCaul said it's now up to Congress to take steps to ensure it doesn't happen again.

"Unfortunately, there's a lot of work to be done," he said. "That's the bad news, but the good news is you've got people like them. [Kutz' team] is something well worth funding. We need to do more of this."

For his part, Kutz is looking forward to his team continuing to integrate and gain experience.

"I think we're getting better and better at what we do, but we're still in the infancy stages," he said. "Fraud, waste and abuse and Katrina . . . border security and national security. All of these issues are of great interest to people."

http://www.house.gov/list/press/tx10_mccaul/morenews/6_29_06_fed_times_gao_under_cov.html