In a report released yesterday, the U.S. Government Accountability Office found that the Department of Energy’s methods for gathering information on its fraud risks do not capture all of the contracting fraud risks it faces.
The report identified nine categories of contracting fraud schemes that occurred at the DOE from 2013 to 2019: billing schemes, payroll schemes, product quality, theft, contract progress schemes, misrepresentation of eligibility, bid-rigging, kickbacks and gratuities, and conflicts of interest.
While acknowledging that the DOE has taken some steps to demonstrate a commitment to combat fraud and assess its contracting fraud risks, the GAO said that the department’s methods capture “selected fraud risks—rather than all fraud risks—facing DOE programs.” For instance, according to the report, the DOE’s risk profiles for fiscal years 2018 and 2019 did not identify four of the nine fraud schemes.
Recommendations: The GAO advises the DOE to:
- Expand its methodology for developing its agencywide fraud risk assessment to ensure that all inherent risks—not limited to top risks—facing DOE programs are fully assessed and documented in accordance with leading practices.
- Update its internal control guidance to clarify the information that reporting entities should obtain to assess the fraud risks for non-management and operating contractors they oversee.
The DOE concurred with both recommendations.