Category: Department of Energy Contracting

DOE OIG Cites Need for Data Analytics to Combat Fraud

Robyn N. Burrows ●

Last month, the Department of Energy (“DOE”) Office of Inspector General (“OIG”) issued a special report on the DOE’s use of data analytics to reduce the risk of fraud, waste, and abuse within DOE programs. As noted in our prior post (“More Cases and Expanded Data Analytics: A Closer Look at DOJ’s FY 2023 False Claims Act Statistics”), the Department of Justice has successfully used data analytics to identify and develop fraud cases, and the DOE OIG appears poised to adopt a similar approach—despite several implementation challenges.

Citing the significant influx of funds DOE has received through recent spending bills, the OIG report emphasized a need for the DOE to adopt data analytics and data-driven management to conduct oversight—moving away from a “pay and chase” model to a predicative, proactive approach to combatting fraud. However, the OIG found that DOE generally lacks the ability to perform comprehensive and timely analytics given that relevant data is maintained in a multitude of systems across the DOE complex. Without a coordinated approach for data standards, the OIG found that DOE’s ability to monitor contract costs and manage fraud risks is likely to be hampered.

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GAO Report Suggests DOE Should Identify More Instances of Contractor Fraud

Luke W. Meier and Robyn N. Burrows

Last week, the Government Accountability Office (“GAO”) issued a report on Department of Energy (“DOE”) contracting, Improvements Needed to Ensure DOE Assesses Its Full Range of Contracting Fraud Risks. The thrust of the report is that DOE should do more to prevent and detect fraud, particularly in less-examined areas such as bid-rigging, misrepresentation of eligibility, kickbacks and gratuities, and conflicts of interest.

DOE relies on contractors to carry out its missions at laboratories and other facilities, spending approximately 80 percent of its $41 billion in total obligations on contracts. In March 2017, GAO reviewed DOE’s approach to managing its risk of fraud and found DOE did not use leading practices, resulting in missed opportunities to mitigate the likelihood and impact of fraud.

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