(Adam Andrzejewski – RealClear Wire) The Federal Emergency Management Agency did not have controls in place to prevent over $3.7 billion of improper payments from the lost wages assistance program, a recent report from the Office of the Inspector General for the Department of Homeland Security found.
In 2020, in response to the Covid-19 pandemic, FEMA took funds from the Disaster Relief Fund for lost wages assistance to “help ease the economic burden for people who lost work because of coronavirus disease.” FEMA partnered with 54 state workforce agencies to rush $44 billion out the door to people who lost their jobs due to Covid-19.
Thanks to a lack of basic accounting controls, 21 of those 54 agencies distributed more than $3.7 billion in improper payments — in just six weeks. Included in the $3.7 billion of improper payments is $3.3 billion in potentially fraudulent payments, $21.6 million in overpayments, and $403 million in payments made without required self-certification attestations.
The report found FEMA did not institute policies to ensure state workforce agencies would not make improper payments, despite being required to do so by federal law. It also failed to ensure these agencies promptly reported allegations of fraud to appropriate agencies.
The report blamed the rushed implementation of this program for its failures, citing the short time of 11 days that the agency had to begin disbursing $44 billion worth of funds
Unfortunately, this carelessness is part of a broader trend of improper payments. In 2021, the Government Accountability Office found $281 billion worth of improper payments across government agencies in just one year.
While it’s understandable that there will be some improper payments in Covid-era programs, it’s unacceptable to make $3.7 billion in improper payments in just six weeks because of a lack of basic accounting controls.