Wednesday, June 3, 2009

"Like bees to honey"

While much of the debate over our government's stimulus efforts has focused on the economic rationale for such programs and the resulting moral hazard, the discussion of the fraud opportunities created by the stimulus programs has been seemingly non-existent.

From the Boston Globe:
FBI director Robert Mueller says the government's stimulus package, including the Troubled Asset Relief Program, has "the potential to be the next wave" of cases the agency investigates.

"These funds are inherently vulnerable to bribery, fraud, conflicts of interest, and collusion," he said yesterday at the Economic Club of New York. "There is an old adage: Where there is money to be made, fraud is not far behind, like bees to honey." With trillions of dollars at stake, "even a small percentage of fraud would result in substantial, substantial taxpayer losses," he said.

Neil Barofsky, Special Inspector General for TARP has already launched over a dozen investigations into possible misuses of bailout funds. In addition, he said the following regarding the oversight of TARP (source):

Inadequate oversight and insufficient information about what companies are doing with the money leaves the program open to fraud, including "conflicts of interest facing fund managers, collusion between participants and vulnerabilities to money laundering,"

I almost wonder if some lawmaker, discussing oversight of the federal stimulus programs, said, "You know, I hear that Bernie Madoff has a great auditor," followed by, "I wonder if they are accepting new clients?"

As a footnote, anyone interested in getting a piece of the action should check out this EZ-CASH bailout application.

No comments:

Post a Comment