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Every week is Fraud Awareness Week, here at the PRAC
But this week is special. We’ve joined the global effort to raise awareness of fraud and its impact during the Association of Certified Fraud Examiners’ annual International Fraud Awareness Week.
With the bipartisan support of Congress, we’ve built a data-driven model for pandemic oversight that can be applied to prevent fraud in all future government programs. Here’s what we’ve done, and how we can help protect against future fraud.
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Powering through pandemic fraud investigations
Our Pandemic Analytics Center of Excellence (PACE) proactively identifies fraud. Using advanced data techniques, such as data matching, risk modeling, and machine learning, this team of data scientists uncovers patterns, networks of potential wrongdoers, irregularities, and other red flags that point to potential fraud. Their expertise has boosted the work of our law enforcement partners on 983 pandemic-related investigations with over 23,000 subjects involving a potential loss of $2.3 billion to fraud. They also support the PRAC’s own Fraud Task Force made up of 50 agents from 16 Offices of Inspectors General. The PRAC Fraud Task Force’s investigations alone have led to charges against 107 individuals for pandemic fraud, marking an important milestone in our tireless pursuit of justice.
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Sounding the alarm
In January 2023, we issued a Fraud Alert that identified $5.4 billion in potentially fraudulent pandemic loans from the Small Business Administration’s COVID-19 Economic Injury Disaster Loan program and the Paycheck Protection Program linked to more than 69,000 questionable Social Security Numbers (SSNs). In May 2023, we provided an update that found $38 million in potentially improper or fraudulent loans obtained using the SSNs of deceased individuals.
If the PACE had existed at the outset of the pandemic, we could have flagged these suspicious applications before money was distributed, likely saving taxpayers hundreds of millions of dollars—if not over a billion.
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Keeping eligible payments moving while blocking fraud
Government agencies must balance providing money and services to those that need them swiftly with preventing and detecting fraud, waste, and abuse. Our Blueprint for Enhanced Program Integrity is a resource guide for the oversight community and federal agencies that will help them protect critical programs from improper payments and fraud:
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Chapter One outlines lessons learned from the pandemic that can help program administrators develop and implement programs with strong internal controls.
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Chapter Two highlights suggestions for legislators and regulators to consider when drafting legislation and policy for funding.
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Facing the future
In September, PRAC Chair Michael E. Horowitz testified to the House of Representatives how the PACE has prevented improper payments and fraud. He urged Congress to sustain its capabilities past the PRAC’s scheduled sunset on September 30, 2025, and to expand its jurisdiction to all federal spending.
The PACE “allows Offices of Inspectors General to assess applications for fraud indicators before funds are disbursed, which is critical because, as we saw during the pandemic, every dollar that goes to a fraudster doesn't go to small businesses, the unemployed, and others Congress intended to help.”
We’re working to fight fraud and strengthen internal controls. Visit our website to see what we and our partners have found in our oversight.
Disclaimer: An indictment is a formal accusation of a serious crime. However, all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
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