Comer Calls on GAO to Investigate Taxpayer Fraud in Federally Funded State-Administered Programs

WASHINGTON-House Committee on Oversight and Government Reform Chairman James Comer (R-Ky.) today requested the Government Accountability Office (GAO) conduct a systemic review of waste, fraud, and abuse across numerous federally funded benefits programs managed by states and U.S. territories. As the Committee continues its investigation into Minnesota's social services programs-where fraud schemes have siphoned billions of dollars in taxpayer funds-Chairman Comer is warning that similar schemes may be exploiting vulnerabilities in other state-run programs across the country. In the letter to GAO Acting Comptroller General Orice Williams Brown, Chairman Comer called on GAO to conduct a comprehensive investigation of federally funded, state-administered programs to identify indicators of fraud, assess fraud prevention efforts, and determine whether existing oversight mechanisms are sufficient to safeguard taxpayer dollars nationwide.

"The Committee on Oversight and Government Reform is investigating reports of widespread waste, fraud, and abuse across a multitude of federally funded benefits programs that are managed by individual states and territories. Our investigation of widespread fraud in Minnesota's social services programs, amounting to billions of dollars in taxpayer money, raises serious concerns that other states may have fallen victim to similar schemes. All the while, American taxpayers are left to foot the staggering bill. I write to you today to request that the Government Accountability Office investigate indicators of fraud, current fraud prevention efforts, and make relevant recommendations to executive branch agencies and to Congress for programmatic specific legislative reforms in federally funded, state-administered programs," wrote Chairman Comer.

Several major fraud schemes identified by the Oversight Committee highlight vulnerabilities in federally funded benefits programs. These include hundreds of billions of dollars in potentially fraudulent COVID-19 relief payments, with the GAO and the U.S. Department of Labor estimating that between $100 billion and $191 billion may have been improperly paid. The Committee is also examining fraud in Minnesota's social services programs, including Feeding Our Future, a Minnesota nonprofit that received more than $240 million in Federal Child Nutrition Program funds intended to feed children but was instead used for luxury purchases and real estate schemes. Additional concerns include Supplemental Nutrition Assistance Program fraud schemes and more than $16.2 billion in Medicaid-funded benefits paid to illegal aliens across several states.

"The Committee is committed to the vital work of uncovering the nature and extent of alleged fraud schemes in Minnesota and elsewhere with the intention of preventing similar activities in the future. Investigating fraud schemes like these is precisely the kind of work that Congress has empowered GAO to conduct. We are therefore requesting that GAO compile a comprehensive listing of federally funded, state-administered programs," continued Chairman Comer. "It is critical that Federal programs identify issues before they arise, therefore a close review of programs across states would benefit the Committee's further nation-wide oversight and legislative reform work. The Committee is also interested in any government-wide legislative reforms that can be identified to address systemic areas of failure or risk. We ask that GAO staff regularly update Committee staff on the progress of the review and provide periodic briefings as appropriate."

Read the letter here.