Big data streaming analytics have the potential to overhaul federal efforts to fight fraud, waste, and abuse in government acquisitions and programs, from targeting healthcare fraud to finding income tax cheats.
That was the overwhelming message at the “Stealing from Uncle Sam” conference, held at the Newseum on November 19th.
As is the case with cybersecurity threats, there are just as many dangers posed by insiders, as well as those that come from outside the organization. Mark Reger, deputy director of the Office of Federal Management, Office of Management and Budget, pointed out that government at all levels – federal, state, local, and tribal – issues credit cards for travel. “Right now those credit cards generate information back to us and we know how they’re being used … The implementation of charge cards is the greatest tool in a long time to identify issues.”
Reger said OMB is in the process of rewriting Appendix C of Circular A-123, “Management’s Responsibility for Internal Control.” The new version of Appendix C, “Requirements for Effective Measurement and Remediation of Improper Payments,” will establish new categories of improper payments, he said.
For instance, OMB has created “a do-not-pay process [that] creates a list that agencies can go to … to see if there are issues.” This will allow computer matching of pay requests against names on the list to screen out improper payments, he said.
When most people think about fraud, they think about tax cheats.
“From the fraud side, I don’t worry so much about individual fraud,” said Dean Silverman, director of the Office of Compliance Analytics at the IRS. “What really drives the work the last two or three years is identity theft.”
He said there are people filing hundreds, even thousands, of returns. “It’s a double whammy – large amounts of money can go out very quickly, and legitimate tax filers can be hit with a problem … The goal in fraud, waste and abuse [compliance] on the identity side is getting better processes and technologies [so] we can make a determination as fast as we can.”
Gary Cantrell, deputy inspector general for investigations at the Department of Health and Human Services, said using big data helps HHS focus its resources in the right places.
“Five years ago we didn’t have direct access to Medicare data,” Cantrell said. Now more than 300 people in his organization can access that data. “Now I can tie ambulance claims to physician claims to hospital claims to insurance claims.”
It’s obvious that agency leaders are aware of the scale of the waste, fraud, and abuse problem they face, as well as the impact that it has on their operating costs and in building trust with their constituents. So why aren’t more agencies following the lead of the HHS, IRS and OMB? Agency leaders frequently cite the fear being overwhelmed by the volume of data their organization would need to process and report on manually in order to find the anomalies that are the tell-tales signs of fraud. But with new tools and technology manual reports are a thing of the past and agencies can fight fraud with real-time transactional data and historical analysis of constituent and end user behavior.
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