RECOVERY OVERSIGHT OFFICE (ROO) OFFICE OF INSPECTOR GENERAL U.S. DEPARTMENT OF THE INTERIOR

RECOVERY OVERSIGHT OFFICE (ROO)

OFFICE OF INSPECTOR GENERALU.S. DEPARTMENT OF THE INTERIOR

RECOVERY OVERSIGHT OFFICE

Jerry McGuire (Tom Cruise) = US Federal Government with Grant moneyRod Tidwell (Cuba Gooding Jr) = Agency seeking Financial AssistanceOffice Staff and onlookers = Grant Managers


Jerry McGuire (Tom Cruise) = US Federal Government with Grant moneyRod Tidwell (Cuba Gooding Jr) = Agency seeking Financial AssistanceOffice Staff and onlookers = Grant Managers

• Discuss the Office of Inspector General (OIG) mission and authority

• Discuss the American Recovery and Reinvestment Act (ARRA)

• Discuss the Recovery Oversight Office (ROO)

• Present an overview of fraud with some examples

• Discuss the impact fraud has on the Department of the Interior (DOI)

• Review indicators for detection and prevention of fraud

• Explain ways to report suspected fraud


• Are our Department and Bureau programs vulnerable to fraud?

• Do we have adequate controls to detect fraud directed against our programs?

• Do you know what a fraud is?

• Do you know when and how to report instances of suspected fraud?


• Council on Inspectors General on Integrity and Efficiency (CIGIE) consist of 67 members at the federal level

• 28 Offices of Inspectors General with agencies receiving ARRA funds

• 11,600 employees of multiple disciplines

• $1.9 billion annually in expenditures


• $16.5 billion in potential savings from audit recommendations and investigative recoveries

• Over 300,000 hotline complaints processed

• Over 17,000 indictments, prosecutions, and civil actions

• 4,296 suspensions or debarments

• 5,807 adverse personnel actions


*PCIE and ECIE Progress Report to the President FY 2007

• Promote Excellence, integrity and accountability in the programs, operations, and management

• Promote effective financial, grant and procurement activities

• Promote the highest standards of integrity, impartiality and professionalism

• Promote effective coordination & improved management practices among Department components


• Derived from the Inspector General Act of 1978, as amended

• To conduct and supervise audits and investigations relating to programs and operations of the Department

• To prevent and detect fraud, waste and mismanagement in programs and operations

• To have access to all records, reports, audits, reviews, documents, papers, recommendations, or other material relating to programs and operations


An intentional misrepresentation which causes the suffering of damages and usually monetary losses

•Fraud is cheating for profit

•Fraud is characterized by acts of guile, trickery, concealment, or breach of confidence, which are used to gain some unfair or dishonest advantage involving money, property, or services


Differs from other crimes:

• Ordinary criminal attempts to conceal identity. For example, a burglary will be detected; the burglar conceals his identity by timing the crime to utilize darkness or lack of witnesses.

• Fraudster attempts to conceal the crime itself. For example, a bookkeeper hides embezzlement by creating false accounts. Once the false accounts are detected it is usually obvious who did it.


• Government contractors―Prime contractors―Sub-contractors

• Government employees

• Financial assistance recipients―Sub-recipients―Contractors

• Vendors seeking government business


• False/Dual Billing

• Kickbacks

• Product Substitution

• Cost Mischarging


• Defective Pricing

• False Representations

• Forgery• Mail Fraud • Conspiracy• False Claim• Embezzlement• False Statement• Theft and Bribery• Conflict of Interest• Obstruction of Federal Audit• Fraud by wire, radio, or television• Major Fraud Against the United States


The intentional submission by the contractor to the government directly or indirectly of goods and/or services that do not conform to the contract specifications or requirements.

•Example:―Contractor awarded contract to install fire retardant

paneling―Contractor installs non-fire retardant paneling―Contractor submits invoice to government reflecting

that fire retardant paneling was purchased and installed


• Misrepresentation of qualifications, certifications, knowledge, pricing or costs which is then presented to the government to further a fraud scheme.

• Examples: ― False Certification― False/Inflated Resumes― False Statements/Invoices





NPS22%MMS

1%OSM2%

BOR*10%

USGS9%

FWS13%

BLM9%

BIA21%

DO/DWP**13%

*Includes Central Utah Project Completion Act**Includes DM, OIA, SOL, OIG, OST, PILT, HAZMAT, NRDAR, FBMS, Latino Commission Grant and Wildland Firefighting w/ Supps. ***Derived from Omnibus Appropriations Act for 2009 (Public Law 111-8)

Department of the Interior budget FY 2009 = $11.3 billion***


The Association of Certified Fraud Examiners estimates that the typical organization loses 7% of its annualrevenues to fraud.*

Approximately $791 million of our total budget could be at risk to fraudulent activity as reflected below by bureau:

*Derived from 2008 ACFE Report to the Nation on Occupational Fraud and Abuse

USGS = $ 73MBOR = $ 78.2M OSM = $ 11.5M

BIA = $ 166.3MNPS = $ 176.7MMMS = $ 11.4M

FWS = $ 100.8MBLM = $ 72.7MDO/DWP= $ 100.1M

• Conflicts of interest

• Exceeding appointed authority

• Unauthorized transactions

• Duplicate or inflated charges

• Inadequate, missing, or altered records

• Unsupported or unauthorized draw-downs

• Identical values or sequence in bids and proposals


ARRA expands protection to non-federal employees who reasonably believe there is reasonable evidence of:

•Gross mismanagement of contract or grant•Gross waste of ARRA funds•Substantial danger to health and safety•Abuse of authority•Violation of law, rule or regulation regarding

contract or grant


*FAR 1.603-2 and FAR 2.101

• Perform audits and inventories

• Reconcile financial records

• Compare bids and proposals

• Perform only authorized transactions

• Protect government and proprietary information

• Maintain supporting documentation

• Establish and follow effective internal controls

• Report suspicious activity


• Ensuring you are our “first defense”• Avoid conflicts of interest – follow the rules• Always imagine how your actions look

without explanation – no audio • Be fair and reasonable• Work within the limits of your authority• Be aware of contractor efforts to influence or

steer you

Remember - very few contractors are bad



• Immediately report any suspected fraud• Making your report

―Reporting to your supervisor―Reporting to the OIG

• Collect details of suspected activity• When making your report, try to identify:

― Who― What

• Do not discuss your suspicions with others

• Do not investigate on your own!

― When― Where

― How― Why


Web: http://www.doioig.gov/hotline

Mail: U.S. Department of the Interior Office of Inspector General Attn: Fraud Hotline 1849 C Street NW - Mail Stop 4428 Washington, D.C. 20240

Phone Hotline: Toll Free 1-800-424-5081(in Washington DC area: 202-208-5300)

RECOVERY OVERSIGHT OFFICE (ROO)

OFFICE OF INSPECTOR GENERALU.S. DEPARTMENT OF THE INTERIOR


• Congress appropriated about $787 billion

• DOI received approximately $3 billion

• The Act requires obligation of these dollars at an unprecedented speed

www.recovery.govrecovery.doi.gov


Bureau of Reclamation--------------------$1 billion

National Park Service----------------------$750 million

Bureau of Indian Affairs-------------------$500 million

Bureau of Land Management------------$320 million

U.S. Fish and Wildlife Service------------$280 million

U.S. Geological Survey--------------------$140 million

Office of Inspector General--------------$15 million

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• The Act creates new means of accountability and transparency for all entities that receive stimulus oversight money

• DOI OIG received $15 million

www.doioig.gov/recovery


The Recovery Oversight Office (ROO)

• Comprised of a diverse staff including:• Auditors• Evaluators• Investigators• Analysts

• Speed --- Innovation --- Flexibility --- Diligence

ROO STRATEGY


PREVENTIOPREVENTIONN

DETECTIONDETECTIONREPORTINGREPORTING


• Fraud awareness briefings

• Single audit education

• Real time liaison with the Department

• Monitor contract and grant awards

• Review internal and financial management controls


• Critical Point Evaluations• Compliance with ARRA and internal controls• Review of risk management plans and project

outcomes

• Forensic Analysis• Periodic monitoring of contracting databases• Collaboration with the OIG Hotline staff

• Proactive Initiatives• Site inspections• Integrity testing


• Management Notifications to DOI and Bureaus• Recovery Oversight Advisories• Recovery Flash Reports• Best Practices Reports• Website Management• Semi-Annual Reporting• Recovery & Accountability Transparency (RAT) Board• Financial Reporting (www.recovery.gov)


Documents

RECOVERY OVERSIGHT OFFICE (ROO) OFFICE OF INSPECTOR GENERAL U.S. DEPARTMENT OF THE INTERIOR