During a Joint Economic Committee hearing prior to the congressional recess, Sen. Maggie Hassan (D-NH) questioned Andrew Cannarsa, Executive Director at the Council of the Inspectors General on Integrity and Efficiency, about efforts in combatting fraud.
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00:00Mr. Chairman. Thank you. Well, thank you, Mr. Chair, and again, thank you all for your testimony.
00:07I caught most of Mr. Canarsa's, and I'm sorry I missed yours, but I want to start with a few
00:11questions. Mr. Canarsa, inspectors general play a key role in identifying and rooting out fraud
00:17across the federal government. As part of their efforts, they often encounter barriers when they
00:22try to work together across agencies and share data that could prevent fraud. For instance,
00:27an inspector general at one agency might not have the staff or time needed to access data
00:32on fraud that's stored at multiple other agencies. I know that your organization wants to establish
00:38some centralized data analytics capacity that the investigators could use to further detect and
00:44prevent fraud across the government, so this is a two-part question. One, what are some of the most
00:50promising examples of how inspectors general are already sharing data to prevent fraud, such as by
00:56working together to stop criminals who have multiple shell companies that have been defrauding
01:01our small business loan programs? So that just, why don't we start with that? Sure. Yeah. Sure. Thank
01:07you for the question, and Senator Hassan, I wanted to thank you for working with Senator Joni Ernst on the
01:12IG Senate caucus. We appreciate your efforts and look forward to working with you both on that.
01:18To the question, several examples going back to the start of the pandemic, and want to give credit to
01:25the Small Business Administration, OIG, and Department of Labor, OIG, who had oversight over the PPP and
01:32the EIDL programs, and then the Pandemic Unemployment Insurance Program, which obviously at that time,
01:38it was a need for those funds to go out at the time, but it left it ripe for fraud, and where the
01:45PRAC came in and helped was to identify those, a lot of those suspicious claims that were clustered,
01:51and which led to, in those cases, groups that were putting in multiple claims, you know, because they
01:58saw some go through, so they kept going for them. Right. In both instances, both SBA, OIG, and DOLOIG
02:04have successful fraud investigations to the tune of millions of dollars that were, that were found, and,
02:10and prosecutions continued from there. Great. And what can Congress do to make sure that that sort of
02:20cooperation gets easier while also protecting people's privacy? I think, as I mentioned, the
02:26expanding and enhancing the potential of the PRAC's pace, you know, if we can do what they've shown in
02:33just the pandemic realm programs, if we can do that across federal programs, make it easier for, as you
02:40mentioned, for agencies and their OIGs to match in a central location, again, with, with all privacy
02:45protections and considerations in place, that just makes it easier to go to one stop instead of each
02:52agency trying to make these agreements one-off. Right. And in my experience as a governor, it, you know,
02:57one of the hard things is finding actual staff and resources to focus on this, so that if we can share
03:03in the, in the effort, makes a big difference. Dr. Thomas, your position as the chief scientist of the
03:09Government Accountability Office gives you a good vantage point to see how the federal government
03:13deploys technology, especially when it comes to strengthening government, government effectiveness
03:17and saving taxpayer dollars. What are areas of the government that have the highest potential
03:23for reducing waste fraud and abuse through the deployment of cutting-edge technology, including AI?
03:28Yeah, so if you look at our, our government-wide fraud report that we just put out, we talk about
03:35the, the different programs that in the, there's a range that goes with it. So I think as earlier
03:40as mentioned, it's half a trillion dollars. That's the high range. Those are for high-risk programs. You
03:44know, think about like COVID style programs. The lower range is really analyzing the lower risk programs.
03:51We did a modeling exercise using Monte Carlo to understand what that range looks like. Essentially,
03:56when it comes down to additional transparency, obviously within the payment systems and making
04:01sure that the agencies are using the analytics and sharing the use of that analytics, as well
04:08as what has already been talked about earlier that we support is setting up a center of excellence that
04:12supports the fraud world. So that the, across the government, all of these agencies can work
04:19together, can share data that matters and share tools that identify this flags of potential fraud.
04:25The important part though that I want to make sure we don't miss is that the analysts play a critical
04:29role. Yeah. The analytics only identifies a flag that some may, something might be associated with
04:34fraud. It is the analysts themselves that actually goes and does the investigation. Right. That's very
04:39helpful. I have lots more questions too, but why don't I yield back and then we can keep going.
04:43Thank you very much.
04:54Yeah.
04:55Thank you so much.