Minnesota Man Charged with COVID-Relief Fraud and Money Laundering

A Minnesota man was charged in an indictment unsealed today for allegedly fraudulently obtaining approximately $841,000 from the Paycheck Protection Program (PPP).

Acting Assistant Attorney General Brian Rabbitt of the Justice Department’s Criminal Division, U.S. Attorney Erica H. MacDonald of the District of Minnesota, Acting Special Agent in Charge Aubree M.  Schwartz of the FBI’s Minneapolis Field Office, Special Agent in Charge Kathy A. Enstrom of the IRS-Criminal Investigation (IRS-CI), Special Agent in Charge Justin R. Bundy of the FDIC’s Office of the Inspector General (FDIC-OIG), and Acting Special Agent in Charge Brian Sullivan of the Small Business Administration Office of Inspector General (SBA-OIG), Central Region made the announcement.

Kyle William Brenizer, 32, of St. Paul, Minnesota, was charged in a criminal indictment in the District of Minnesota with wire fraud and money laundering.  He made his initial appearance this afternoon before U.S. Magistrate Judge Becky R. Thorson of the District of Minnesota and remains in custody.  He will appear for a detention hearing on Aug. 26.

The indictment alleges Brenizer was the owner and manager of True-Cut Construction LLC (True-Cut), a contracting and construction company located in Brooklyn Park, Minnesota.  In August 2018, True-Cut and Brenizer were ordered by the Minnesota Department of Labor and Industry to cease and desist from doing business and in December 2019, True-Cut’s contractor license expired and was never renewed.

Brenizer allegedly submitted a false and misleading PPP application in the name of True-Cut seeking approximately $841,000, but the application was denied.  On May 12, 2020, Brenizer again submitted a false and misleading PPP application in the name of True-Cut seeking approximately $841,000 in PPP funds.  This time, in order to conceal his involvement, Brenizer allegedly submitted the application under the name of another individual. 

Brenizer falsely stated that True-Cut’s average monthly payroll was over $330,000 for approximately 30 employees.  In addition, Brenizer falsely certified that he was not subject to any pending criminal charges even though he was allegedly named in multiple felony charges pending in the State of Minnesota for such charges as check forgery, identify theft, and theft by swindle.  Due to these various misrepresentations and omissions, on May 13, 2020, Brenizer’s second application was approved, and he received $841,000 in PPP funds.

According to the allegations in the indictment, instead of using the PPP funds for permissible business expenses, Brenizer transferred approximately $650,000 to a bank account unrelated to True-Cut and made a $29,000 payment to purchase a Harley-Davidson motorcycle, spent over $1,000 on golf expenses, among other retail and entertainment expenditures for his personal benefit.

The CARES Act is a federal law enacted March 29.  It is designed to provide emergency financial assistance to millions of Americans who are suffering the economic effects resulting from the COVID-19 pandemic.  One source of relief provided by the CARES Act is the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses through the PPP.  In April 2020, Congress authorized over $300 billion in additional PPP funding.

The PPP allows qualifying small businesses and other organizations to receive loans with a maturity of two years and an interest rate of 1 percent.  Businesses must use PPP loan proceeds for payroll costs, interest on mortgages, rent and utilities.  The PPP allows the interest and principal to be forgiven if businesses spend the proceeds on these expenses within a set time period and use at least a certain percentage of the loan towards payroll expenses.

A federal criminal indictment is merely an accusation. A defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law. 

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

The FBI, IRS-CI, FDIC-OIG and SBA-OIG investigated the case.  Assistant Chief L. Rush Atkinson of the Department of Justice’s Criminal Division’s Fraud Section and Assistant U.S. Attorneys Matthew S. Ebert and Allison K. Ethen of the U.S. Attorney’s Office for the District of Minnesota are prosecuting the case.     

The year 2020 marks the 150th anniversary of the Department of Justice.  Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.

Hits: 2

News Network

  • The United States Impedes Hizballah Financing by Sanctioning Seven Individuals
    In Crime Control and Security News
    Antony J. Blinken, [Read More…]
  • Remarks by Deputy Attorney General Jeffrey A. Rosen on the Resolution of Civil and Criminal Investigations into Purdue Pharma and the Sackler Family
    In Crime News
    Good morning.  I am pleased to be joined today by Vermont’s U.S. Attorney Christina Nolan, New Jersey’s First Assistant U.S. Attorney Rachael Honig, Acting Assistant Attorney General for the Civil Division Jeff Clark, and Eastern Texas U.S. Attorney Steve Cox.
    [Read More…]
  • Examining Facilitating Factors for Safe, Voluntary, and Sustained Post-Conflict Refugee Returns (RAND Corporation)
    In Human Health, Resources and Services
    Bureau of Population, [Read More…]
  • Ambassador Pamela Spratlen Designated as Senior Advisor to Department Health Incident Response Task Force
    In Crime Control and Security News
    Office of the [Read More…]
  • University Researcher Sentenced to Prison for Lying on Grant Applications to Develop Scientific Expertise for China
    In Crime News
    An Ohio man and rheumatology professor and researcher with strong ties to China was sentenced to XX months in prison for making false statements to federal authorities as part of an immunology research fraud scheme.
    [Read More…]
  • Sexual Harassment: NNSA Could Improve Prevention and Response Efforts in Its Nuclear Security Forces
    In U.S GAO News
    What GAO Found The National Nuclear Security Administration (NNSA)—within the Department of Energy (DOE)—and its contractors may have limited information on the prevalence of sexual harassment within the nuclear security forces. NNSA's nuclear security forces include federal agents in NNSA's Office of Secure Transportation (OST), which is responsible for transporting nuclear materials, and contracted guard forces at four of its sites. Federal officials at NNSA and contractor representatives at four NNSA sites that process weapons-usable nuclear material reported very few cases of sexual harassment from fiscal years 2015 through 2020. Research shows that the least common response to harassment is to report it or file a complaint. The U.S. Equal Employment Opportunity Commission (EEOC)—which enforces federal laws prohibiting harassment—suggests organizations survey employees to assess the extent to which harassment is a problem in their organization. NNSA does not survey employees on this topic, nor does NNSA call for such surveys in its contracts for security forces. Because NNSA relies solely on reported incidents, it may not have full knowledge into the nature or extent of sexual harassment in OST or by its contractors at its sites. Surveying employees would better position them to identify actions to effectively prevent and respond to harassment. To varying degrees, NNSA and its contractors follow EEOC's recommended practices to prevent and respond to sexual harassment in their nuclear security forces. For example, with respect to recommended training practices, NNSA and its contractors provide antiharassment training to all employees, but only one force offers workplace-specific training that addresses sexual harassment risk factors relevant to the security forces. Because NNSA has not formally reviewed EEOC's practices and considered which to adopt for its nuclear security forces, or made similar considerations for its security force contractors, the agency may be missing opportunities to prevent and respond to sexual harassment. Selected EEOC Practices for Effective Training to Prevent and Respond to Sexual Harassment and Number of NNSA's Nuclear Security Forces That Reflect Those Practices in Training EEOC Promising Practice Number of forces that reflect the practice Provided to employees at every level and location of the organization 5 of 5 Tailored to the specific workplace and workforce 1 of 5 Explains the complaint process, as well as any voluntary alternative dispute resolution processes 2 of 5 Explains the range of possible consequences for engaging in prohibited conduct 1 of 5 Source: GAO comparison of National Nuclear Security Administration (NNSA) and protective force contractor information with the U.S. Equal Employment Opportunity Commission's (EEOC) November 2017 Promising Practices for Preventing Harassment . | GAO-21-307 EEOC has found that NNSA and DOE do not meet all EEOC requirements relevant to preventing and responding to sexual harassment. For example, NNSA does not have an antiharassment program or a compliant antiharassment policy. According to EEOC officials, NNSA and DOE efforts to date have improved some aspects of their EEO programs, but because the agencies have not fully implemented their plans to address deficiencies identified by EEOC, DOE and NNSA may be missing opportunities to establish and maintain effective programs that include protection from and response to sexual harassment. Why GAO Did This Study Federal law prohibits sexual harassment in the workplace. Besides being harmful to those harassed, sexual harassment can decrease organizational performance and increase turnover. In January 2019, public allegations of sexual harassment in NNSA's nuclear security forces drew attention to this issue. House Report 116-120 provided that GAO review sexual harassment in NNSA's nuclear security force. This report examines (1) what NNSA and its contractors know about the prevalence of sexual harassment in their nuclear security forces, (2) the extent to which NNSA and its contractors implement EEOC recommendations to prevent and respond to sexual harassment, and (3) the extent to which EEOC found that NNSA and DOE meet its requirements relevant to sexual harassment. GAO reviewed information on sexual harassment and programs to address such harassment at DOE and NNSA from fiscal years 2015 through 2020. GAO analyzed documents and data, conducted a literature review, interviewed NNSA officials, and compared NNSA and contractor actions with EEOC-recommended practices for preventing harassment.
    [Read More…]
  • Argentina Travel Advisory
    In Travel
    Do not travel to [Read More…]
  • North Macedonia Travel Advisory
    In Travel
    Reconsider travel to [Read More…]
  • Covid-19 Housing Protections: Moratoriums Have Helped Limit Evictions, but Further Outreach Is Needed
    In U.S GAO News
    What GAO Found Eviction moratoriums at the federal, state, and local levels reduced eviction filings during the COVID-19 pandemic; however, some eligible renters may not have benefitted from a recent federal moratorium. GAO's analysis of 63 jurisdictions found that the median rate of eviction filings was about 74 percent lower in the last week of July 2020—when a moratorium included in the CARES Act expired—than in the same week in 2019. Eviction filings remained lower throughout 2020 (relative to 2019) but gradually increased during a separate moratorium ordered by the Centers for Disease Control and Prevention (CDC) in September 2020 (see fig.). During this moratorium, jurisdictions without separate state or local moratoriums experienced larger increases in eviction filings, which suggests that some renters may not fully understand how to use the CDC moratorium (completing required documentation). CDC extended its moratorium through March 31, 2021, but has taken few steps to promote awareness and understanding of the moratorium and its requirements. Clear, accurate, and timely information is essential to keep the public informed during the pandemic. Without a communication and outreach plan, including federal coordination, CDC will be missing an opportunity to ensure that eligible renters avoid eviction. Year-over-Year Percentage Change in Eviction Filings in 63 Jurisdictions Note: Centers for Disease Control and Prevention's (CDC) moratorium is active through March 31, 2021. Local moratoriums include separate state or local eviction moratoriums. Unlike the CARES Act, CDC's moratorium does not prohibit eviction filings, which could explain some increases. By late January 2021, Treasury had disbursed 99 percent of the $25 billion in Emergency Rental Assistance funds to state and other eligible grantees responsible for making rent and utility payments to recipients. Treasury's initial program guidance issued that month did not fully define some program requirements and included requirements that could have delayed the delivery of funds or deter participation. In late February 2021, Treasury updated its guidance to address several of these concerns, such as by providing grantees with flexibility for prioritizing lower income applicants and allowing written attestation of income. Although the guidance did not clarify certain data collection and spending requirements, officials said they will continue to update guidance to address stakeholder concerns and strike a balance between accountability and administrative efficiency. GAO will continue to actively monitor these efforts. Why GAO Did This Study Millions of renters and property owners continue to experience housing instability and financial challenges during the COVID-19 pandemic. To address these concerns, Congress and CDC created eviction moratoriums, and Congress appropriated $25 billion to Treasury to disburse to state and local grantees to administer emergency rental assistance programs to help those behind on their rent. The CARES Act includes a provision for GAO to monitor federal efforts related to COVID-19. This report examines, among other objectives, (1) how eviction moratoriums have contributed to housing stability during the pandemic and (2) Treasury's implementation of the Emergency Rental Assistance program. GAO analyzed data on eviction filings and local policies in a sample of 63 jurisdictions (selected based on data availability) from January to December 2020. GAO also analyzed Census Bureau survey data on rental payments and data from federal housing entities on mortgage forbearance. GAO interviewed officials from CDC, Treasury, and organizations representing renters, property owners, and rental assistance grantees.
    [Read More…]
  • Belize Travel Advisory
    In Travel
    Do not travel to Belize [Read More…]
  • U.S. Imposes Sanctions on People’s Republic of China Officials Engaged in Coercive Influence Activities
    In Crime Control and Security News
    Michael R. Pompeo, [Read More…]
  • Indonesian Company Admits To Deceiving U.S. Banks In Order To Trade With North Korea, Agrees To Pay A Fine Of More Than $1.5 Million
    In Crime News
    A global supplier of cigarette paper products, PT Bukit Muria Jaya (“BMJ”), has agreed to pay a fine of $1,561,570 and enter into a deferred prosecution agreement with the Justice Department for conspiring to commit bank fraud in connection with the shipment of products to North Korean customers. BMJ, which is incorporated in Indonesia, has also entered into a settlement agreement with the Treasury Department’s Office of Foreign Assets Control (“OFAC”).
    [Read More…]
  • Secretary Antony J. Blinken to U.S. Mission Canada
    In Crime Control and Security News
    Antony J. Blinken, [Read More…]
  • Nuclear Waste: Congressional Action Needed to Clarify a Disposal Option at West Valley Site in New York
    In U.S GAO News
    The Department of Energy (DOE) has made progress in cleaning up radioactive waste at the site of the West Valley Demonstration Project in New York State. In the 1960s and 1970s, a commercial facility at the site reprocessed spent (used) nuclear fuel into reusable nuclear material—creating various wastes that remained on-site after the facility closed in 1976. Since 2011, DOE has demolished 51 of 55 structures there and disposed of about 1.3 million cubic feet of low-level waste to off-site locations. It has also placed solidified high-level waste into interim on-site storage (see fig.). In addition, DOE has processed for interim on-site storage about 30,000 cubic feet of transuranic waste (which is contaminated with elements that have an atomic number greater than uranium). As of February 2020, DOE reported spending about $3.1 billion on contracted cleanup activities, but it cannot estimate the cleanup's final cost until it decides how it will address the remaining waste. High-Level Waste from the West Valley Demonstration Project in Interim On-Site Storage, March 2017 DOE has been unable to dispose of the high-level and transuranic wastes stored at West Valley because there are no facilities authorized to accept these wastes. DOE has identified two potential options for disposal of the transuranic waste: the federal Waste Isolation Pilot Plant in New Mexico and a commercial facility in Texas. However, the New Mexico facility is authorized to accept only waste from atomic energy defense activities, and DOE does not consider West Valley waste to be from atomic energy defense activities. Regarding the Texas facility, state regulations preclude disposal of the waste there. In 2017, DOE submitted to Congress a report on all disposal options, as required by the Energy Policy Act of 2005. Pursuant to this act, DOE must await action by Congress before making a final decision, and Congress has not yet acted. The West Valley Demonstration Project Act, enacted in 1980, requires DOE to assist with cleanup activities at the site of the nation's only commercial facility for reprocessing spent nuclear fuel. The site contained 600,000 gallons of liquid high-level waste, radioactively contaminated structures and soils, and buried radioactive waste. In 2011, DOE began the first phase of its decommissioning plan, which included demolishing above-ground structures and removing contaminated soils. The West Valley Reauthorization Act and the Senate Committee Report No. 116-48 included provisions for GAO to review progress on the cleanup at West Valley. GAO's report examines (1) the status of the cleanup and (2) DOE's options for disposing of the remaining radioactive waste. GAO reviewed DOE's data on cleanup costs and waste volumes and its decommissioning plans, as well as laws, regulations, and policies governing radioactive waste disposal. GAO also interviewed officials from DOE and the state of New York, as well as other stakeholders. Congress should consider taking action to provide a legal option for the disposal of West Valley's transuranic waste. For more information, contact Allison Bawden at (202) 512-3841 or BawdenA@gao.gov.
    [Read More…]
  • Retirement Security: Older Women Report Facing a Financially Uncertain Future
    In U.S GAO News
    In all 14 focus groups GAO held with older women, women described some level of anxiety about financial security in retirement. Many expressed concerns about the future of Social Security and Medicare benefits, and the costs of health care and housing. Women in the groups also cited a range of experiences that hindered their retirement security, such as divorce or leaving the workforce before they planned to (see fig.). Women in all 14 focus groups said their lack of personal finance education negatively affected their ability to plan for retirement. Many shared ideas about personal finance education including the view that it should be incorporated into school curriculum starting in kindergarten and continuing through college, and should be available through all phases of life. Women Age 70 and Over by Marital Status Note: Percentages do not add up to 100 percent due to rounding. Individual women's financial security is also linked to their household where resources may be shared among household members. According to the 2016 Survey of Consumer Finances, among households with older women, about 23 percent of those with white respondents and 40 percent of those with African American respondents fell short of a measure of retirement confidence, indicating their income was not sufficient to maintain their standard of living. The likelihood of a household reporting high retirement confidence rose in certain cases. For example among households of similar wealth, those with greater liquidity in their portfolio and those with defined benefit plan income were more likely to report high retirement confidence. Older adults represent a growing portion of the U.S. population and older women have a longer life expectancy, on average, than older men. Prior GAO work has found that challenges women face during their working years can affect their lifetime earnings and retirement income. For example, we found women were overrepresented in low wage professions, paid less money than their male counterparts during their careers, and were more likely to leave the workforce to care for family members. Taken together, these trends may have significant effects on women's financial security in retirement. GAO was asked to report on the financial security of older women. This report examines (1) women retirees' perspectives on their financial security, and (2) what is known about the financial security of older women in retirement. GAO held 14 non-generalizable focus groups with older women in both urban and rural areas in each of the four census regions. GAO also analyzed data from three nationally representative surveys—the 2019 Current Population Survey, the Health and Retirement Study (2002-2014 longitudinal data), and the 2016 Survey of Consumer Finances. For more information, contact Charles Jeszeck at (202) 512-7215 or jeszeckc@gao.gov.
    [Read More…]
  • Music “tourist” sent to prison for cocaine trafficking
    In Justice News
    A 40-year-old felon from [Read More…]
  • Switzerland Travel Advisory
    In Travel
    Reconsider travel to [Read More…]
  • Justice Department Statement on Law Enforcement Assistance to the Haitian Government
    In Crime News
    The U.S. Department of Justice today released the following statement from spokesman Anthony Coley on department efforts to provide law enforcement assistance to the people and Government of Haiti:
    [Read More…]
  • Further Sanctions on Entities Trading in or Transporting Iranian Petrochemicals
    In Crime News
    Michael R. Pompeo, [Read More…]
  • NASA Observes Earth Day With Downloadable Art
    In Space
    To honor the day’s [Read More…]
  • Hawaii CEO Charged with COVID-Relief Fraud
    In Crime News
    A Hawaii man has been taken into custody on allegations he fraudulently obtained more than $12.8 million in Paycheck Protection Program (PPP) loans guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, announced Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division and U.S. Attorney Kenji M. Price of the District of Hawaii.
    [Read More…]
  • Financial Audit: Federal Deposit Insurance Corporation Funds’ 2020 and 2019 Financial Statements
    In U.S GAO News
    GAO found (1) the financial statements of the Deposit Insurance Fund (DIF) and of the Federal Savings and Loan Insurance Corporation (FSLIC) Resolution Fund (FRF) as of and for the years ended December 31, 2020, and 2019, are presented fairly, in all material respects, in accordance with U.S. generally accepted accounting principles; (2) although internal controls could be improved, the Federal Deposit Insurance Corporation (FDIC) maintained, in all material respects, effective internal control over financial reporting relevant to the DIF and to the FRF as of December 31, 2020; and (3) with respect to the DIF and to the FRF, no reportable instances of noncompliance for 2020 with provisions of applicable laws, regulations, contracts, and grant agreements GAO tested. In commenting on a draft of this report, FDIC stated that it was pleased to receive unmodified opinions on the DIF's and the FRF's financial statements. In regard to the significant deficiency in internal control over contract payment review processes, FDIC stated that it began taking steps to address this issue and will work to enhance control activities and expand monitoring capabilities in this area. Further, FDIC stated that it recognizes the essential role a strong internal control program plays in an agency achieving its mission. FDIC added that its commitment to sound financial management has been and will remain a top priority. Section 17 of the Federal Deposit Insurance Act, as amended, requires GAO to audit the financial statements of the DIF and of the FRF annually. In addition, the Government Corporation Control Act requires that FDIC annually prepare and submit audited financial statements to Congress and authorizes GAO to audit the statements. This report responds to these requirements. For more information, contact James R. Dalkin at (202) 512-3133 or dalkinj@gao.gov.
    [Read More…]
  • DRL Promoting Transparent and Accountable Governance in the Indo-Pacific Region
    In Human Health, Resources and Services
    Bureau of Democracy, [Read More…]
  • The Space Station’s Coolest Experiment Gets Astronaut-Assisted Upgrade
    In Space
    The Cold Atom Lab is [Read More…]
  • Eighth Circuit Reverses Tax Court in Case Involving Statute of Limitations and Bona Fide Residency
    In Crime News
    The Eighth Circuit Court of Appeals issued a published opinion on Tuesday, Dec. 15, 2020, holding for the government in a case involving the statute of limitations on assessment in the context of bona fide residency in the U.S. Virgin Islands (USVI), announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.
    [Read More…]
  • New York Plumbing Contractor Sentenced to 20 Months in Prison for Employment Tax Fraud
    In Crime News
    A New York man was sentenced today to 20 months in prison for failing to collect and pay over to the IRS $732,462 in employment taxes.
    [Read More…]
  • Appointment of Ambassador Jean Manes to serve as Chargé d’affaires to the Republic of El Salvador
    In Crime Control and Security News
    Ned Price, Department [Read More…]
  • Special Representative for Afghanistan Reconciliation Zalmay Khalilzad Travel to Afghanistan, Bulgaria, Norway, Pakistan, and Qatar
    In Crime Control and Security News
    Office of the [Read More…]
  • Laboratory Safety: FDA Should Strengthen Efforts to Provide Effective Oversight
    In U.S GAO News
    The Food and Drug Administration (FDA) has taken steps intended to improve safety at its laboratories, including those that work with hazardous biological agents. Specifically, FDA created the Office of Laboratory Safety (OLS) in 2017 as a safety oversight body for all FDA laboratories. Establishment of FDA's Office of Laboratory Safety (OLS) Note: Prior to March 2019, OLS was referred to as the Office of Laboratory Science and Safety. In coordination with FDA's operating divisions—known as centers—OLS has standardized safety policies, incident reporting, inspections, and safety training. However in creating OLS, FDA did not implement key reform practices that could have helped ensure OLS's effectiveness. For example, FDA's centers and OLS did not reach a shared understanding of OLS's roles and responsibilities—a key practice for effective agency reforms. Although senior agency leaders were involved in developing OLS's strategic plan, disagreements about OLS's role raised by center directors at that time still remain. For example, center directors told GAO that OLS's mission should not include science, laboratory quality management, or inspections. Conversely, the director of OLS said OLS remains committed to its mission as envisioned in the strategic plan, which includes these areas of responsibility. FDA officials said they plan to update the plan in 2021, which presents an opportunity for FDA to address areas of disagreement. In its current form, FDA's laboratory safety program also does not meet the key elements of effective oversight identified in GAO's prior work. For example, The oversight organization should have clear authority to ensure compliance with requirements. However, as part of a 2019 reorganization, FDA placed the OLS director at a lower level than the center directors. Also, OLS does not directly manage the center safety staff responsible for ensuring the implementation of safety policies that OLS develops. As a result, OLS has limited ability to access centers' laboratories—in part because they cannot inspect them unannounced—or to ensure compliance with safety policies. The oversight organization should also be independent from program offices to avoid conflict between program objectives and safety. However, OLS depends on the centers for much of its funding and has had to negotiate with the centers annually for those funds, which can allow center directors to influence OLS priorities through the funding amounts they approve. FDA has not assessed potential independence risks from using center funds for OLS. Without taking steps to do so, FDA's laboratory safety program will continue to compete with the centers' mission objectives and priorities. In 2014, FDA discovered improperly stored boxes of smallpox virus, posing a risk to individuals who might have been exposed. This raised concerns about the oversight of FDA's laboratories that conduct research on hazardous biological agents. In 2016, GAO made five recommendations to improve FDA's laboratory safety, four of which the Department of Health and Human Services (HHS) had not fully implemented as of July 2020. GAO was asked to examine FDA's efforts to strengthen laboratory safety. This report examines FDA's efforts since GAO's 2016 report to improve safety in its laboratories that work with hazardous biological agents. To conduct this work, GAO reviewed FDA documents; assessed FDA's safety oversight practices against key reform practices and oversight elements GAO identified in prior work; and interviewed FDA officials, including staff and senior leaders at OLS and the three centers that work with hazardous biological agents. GAO is making five recommendations to FDA, including to resolve disagreements over roles and responsibilities, to provide OLS with the authority and access to facilities necessary to oversee laboratory safety, and to take steps to assess and mitigate any independence risks posed by how OLS is funded. HHS agreed with all five recommendations. For more information, contact Mary Denigan-Macauley at (202) 512-7114 or deniganmacauleym@gao.gov.
    [Read More…]
  • Colorado Tax Evader Sentenced to Prison for Fleeing to Avoid Previously Imposed Prison Sentence
    In Crime News
    Colorado tax defier Lawrence Martin Birk was sentenced to an additional 78 months in prison for failing to surrender to serve his previously imposed tax evasion prison sentence and for unlawfully possessing firearms, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.
    [Read More…]
  • Department of Justice Announces Charges of North Korean and Malaysia Nationals for Bank Fraud, Money Laundering and North Korea Sanctions Violations
    In Crime News
    The Department of Justice announced a criminal complaint charging Ri Jong Chol, Ri Yu Gyong, North Korean nationals, and Gan Chee Lim, a Malaysia national. The three were charged with conspiracy to violate North Korean Sanctions Regulations and bank fraud, and conspiracy to launder funds. The defendants allegedly established and utilized front companies that transmitted U.S. dollar wires through the United States to purchase commodities on behalf of North Korean customers.
    [Read More…]
  • VA Health Care: Actions Needed to Improve Oversight of Graduate Medical Education Reimbursement
    In U.S GAO News
    The Department of Veterans Affairs' (VA) Veterans Health Administration (VHA) provides training to more than 45,000 medical and dental residents annually through its Graduate Medical Education (GME) program. VHA has established policy for its GME program that details many roles and responsibilities for overseeing VA medical facilities' reimbursements to affiliated academic institutions for residents' salaries and benefits. However, this policy does not define key roles and responsibilities for VHA's central office components, its regional networks, or its medical facilities. For example, VHA's regional networks do not have defined roles and responsibilities for overseeing GME disbursements—contributing to noninvolvement or inconsistent involvement in disbursement agreement oversight. VHA officials reported that they are in the process of updating disbursement agreement policy, but did not indicate if the updates would address all identified concerns. While VHA officials said that VHA's two disbursement agreement oversight mechanisms—facility periodic audits and the Resident Disbursement Audit Process (ReDPro) checklist—are meant to have distinct but complementary purposes, GAO found that VHA policy, guidance, and the tools distributed for these oversight mechanisms did not reflect the distinct purposes officials described. VHA officials said that periodic audits are intended to be a first level of defense and to review actual payments to affiliates, whereas the ReDPro checklist is intended to be a second level of defense, aimed at reviewing the process to see if the rules related to disbursement agreements are being followed by VA medical facilities. However, the ReDPro checklist tool and VHA's recommended periodic audit tool have numerous areas of overlap, including duplicative questions. This overlap causes inefficiencies and unnecessary burden on VA medical facility staff. GAO also found additional weaknesses in the tools, guidance, and training for the two oversight mechanisms. For example, GAO found an unclear ReDPro checklist tool, along with insufficient guidance and training related to conducting the ReDPro reviews. Officials from eight of 13 facilities in GAO's review indicated that the ReDPro checklist instructions were unclear regarding appropriate supporting documents for checklist responses. These weaknesses contributed to errors and inconsistencies in ReDPro responses. the lack of a standard audit tool, and inadequate guidance and training for periodic audit teams that contributed to problematic inconsistencies in the methodologies used by the audit teams and deficiencies in some of the audits conducted. Officials from 10 of 13 facilities in GAO's review indicated that they would benefit from more tools, guidance, or training related to conducting periodic audits. These weaknesses limit the effectiveness of VHA's oversight mechanisms, and put VHA at increased risk of both not being able to identify and correct facilities' lack of adherence to disbursement agreement policy and of possible improper payments to GME affiliates. Under VHA's GME program, VA medical facilities use disbursement agreements to reimburse affiliated academic institutions for residents' salaries and benefits. VHA developed policy related to establishing and administering disbursement agreements, but audits have found that facilities have not always adhered to VHA policy—resulting in improper payments to affiliates. GAO was asked to review VHA policies and procedures related to reimbursements to affiliates for GME. This report examines (1) oversight roles and responsibilities for GME disbursement agreements and (2) VHA's mechanisms for ensuring VA medical facilities adhere to policy. GAO reviewed relevant VHA documents and federal internal control standards and interviewed VHA officials. GAO also reviewed ReDPro checklist responses and documentation from 13 VA medical facilities—selected based on factors including geographic variation, GME program size, and number of affiliates. GAO also visited four of the 13 facilities and interviewed officials at the other nine facilities. GAO is making seven recommendations to VA to define key roles in policy, reduce overlap between the ReDPro checklist and facility periodic audits, and improve the oversight mechanisms' tools, guidance, and training. VA concurred with GAO's recommendations. For more information, contact Sharon M. Silas at (202) 512-7114 or silass@gao.gov.
    [Read More…]
  • Public Designation of Five Bulgarian Public Officials Due to Involvement in Significant Corruption
    In Crime Control and Security News
    Ned Price, Department [Read More…]
  • Kuwait Travel Advisory
    In Travel
    Reconsider travel to [Read More…]
  • ‘Shallow Lightning’ and ‘Mushballs’ Reveal Ammonia to NASA’s Juno Scientists
    In Space
    The spacecraft may have [Read More…]
  • 2020 Wiretap Report: Intercepts and Convictions Decrease
    In U.S Courts
    Federal and state courts reported a combined 26 percent decrease in authorized wiretaps in 2020, compared with 2019, according to the Judiciary’s 2020 Wiretap Report. Convictions in cases involving electronic surveillance also decreased.
    [Read More…]
  • Financial Audit: IRS’s FY 2020 and FY 2019 Financial Statements
    In U.S GAO News
    In GAO's opinion, the Internal Revenue Service's (IRS) fiscal years 2020 and 2019 financial statements are fairly presented in all material respects, and although certain controls could be improved, IRS maintained, in all material respects, effective internal control over financial reporting as of September 30, 2020. GAO's tests of IRS's compliance with selected provisions of applicable laws, regulations, contracts, and grant agreements detected no reportable instances of noncompliance in fiscal year 2020. Limitations in the financial systems IRS uses to account for federal taxes receivable and other unpaid assessment balances, as well as other control deficiencies that led to errors in taxpayer accounts, continued to exist during fiscal year 2020.These control deficiencies affect IRS's ability to produce reliable financial statements without using significant compensating procedures. In addition, unresolved information system control deficiencies from prior audits, along with application and general control deficiencies that GAO identified in IRS's information systems in fiscal year 2020, placed IRS systems and financial and taxpayer data at risk of inappropriate and undetected use, modification, or disclosure. IRS continues to take steps to improve internal controls in these areas. However, the remaining deficiencies are significant enough to merit the attention of those charged with governance of IRS and therefore represent continuing significant deficiencies in internal control over financial reporting related to (1) unpaid assessments and (2) financial reporting systems. Continued management attention is essential to fully addressing these significant deficiencies. The CARES Act, enacted in March 2020, and other COVID-19 pandemic relief laws contained a number of tax relief provisions to address financial stress caused by the COVID-19 pandemic. For example, the Economic Impact Payments provisions in the CARES Act provided for direct payments for eligible individuals to be implemented through the tax code. Implementing the provisions related to these Economic Impact Payment required extensive IRS work, and resulted in it issuing approximately $275 billion in payments as of September 30, 2020. IRS faced difficulties in issuing these payments as rapidly as possible, such as in identifying eligible recipients, preventing improper payments, and combating fraud based on identity theft. IRS discusses the challenges in carrying out its responsibilities under the CARES Act in its unaudited Management's Discussion and Analysis, which is included with the financial statements. As part of monitoring and oversight of the federal government's efforts to prepare for, respond to, and recover from the COVID-19 pandemic, GAO has issued a number of reports on federal agencies' implementation of the CARES Act and other COVID-19 pandemic relief laws, including reports providing information on, and recommendations to strengthen, IRS's implementation of the tax-related provisions. In accordance with the authority conferred by the Chief Financial Officers Act of 1990, as amended, GAO annually audits IRS's financial statements to determine whether (1) the financial statements are fairly presented and (2) IRS management maintained effective internal control over financial reporting. GAO also tests IRS's compliance with selected provisions of applicable laws, regulations, contracts, and grant agreements. IRS's tax collection activities are significant to overall federal receipts, and the effectiveness of its financial management is of substantial interest to Congress and the nation's taxpayers. Based on prior financial statement audits, GAO made numerous recommendations to IRS to address internal control deficiencies. GAO will continue to monitor, and will report separately, on IRS's progress in implementing prior recommendations that remain open. Consistent with past practice, GAO will also be separately reporting on the new internal control deficiencies identified in this year's audit and providing IRS recommendations for corrective actions to address them. In commenting on a draft of this report, IRS stated that it continues its efforts to improve its financial systems controls. For more information, contact Cheryl E. Clark at (202) 512-3406 or clarkce@gao.gov.
    [Read More…]
  • Assistant Attorney General Makan Delrahim Issues Statement Commemorating the 75th Anniversary of the International Military Tribunal at Nuremberg
    In Crime News
    Assistant Attorney General Makan Delrahim of the Department of Justice Antitrust Division issued the following statement on his participation in the Robert H. Jackson Center’s virtual reading of Justice Jackson’s opening statement at Nuremberg for the 75th anniversary of the International Military Tribunal at Nuremberg:
    [Read More…]
  • Statement by Attorney General William P. Barr on the Passing of Justice Ruth Bader Ginsburg
    In Crime News
    Attorney General William [Read More…]
  • Former Correctional Officer Pleads Guilty to Role in Bribery and Drug Smuggling Conspiracy
    In Crime News
    A North Carolina man pleaded guilty today to smuggling drugs and other contraband into Caledonia Correctional Institution in exchange for bribe payments.
    [Read More…]
  • Secretary Pompeo to Deliver Remarks to the Media in the Press Briefing Room
    In Crime Control and Security News
    Office of the [Read More…]
  • Statement from Assistant Attorney General Eric Dreiband and Acting U.S. Attorney for the District of Columbia Michael Sherwin on Legal Victory Protecting Religious Worship in the Nation’s Capital
    In Crime News
    Judge enjoins District [Read More…]
  • South Texan handed significant sentence for trafficking cocaine
    In Justice News
    A 46-year-old Alton man [Read More…]
  • Georgia Correctional Officer Pleads Guilty to Civil Rights Offense for Assaulting Inmate
    In Crime News
    A Georgia correctional officer pleaded guilty today to violating the civil rights of an inmate.
    [Read More…]
  • COVID-19 Housing Protections: Mortgage Forbearance and Other Federal Efforts Have Reduced Default and Foreclosure Risks
    In U.S GAO News
    What GAO Found Many single-family mortgage borrowers who missed payments during the pandemic used the expanded mortgage forbearance provision in the CARES Act. This provision allowed borrowers with loans insured, guaranteed, made directly, purchased, or securitized by federal entities (about 75 percent of all mortgages) to temporarily suspend their monthly mortgage payments. Use of the forbearance provision peaked in May 2020 at about 7 percent of all single-family mortgages (about 3.4 million) and gradually declined to about 5 percent by February 2021, according to GAO's analysis of the National Mortgage Database. As of February 2021, about half of all borrowers who used forbearance during the pandemic remained in forbearance. In addition, Black and Hispanic borrowers, who were more likely to have been economically affected by the pandemic, used forbearance at about twice the rate of White borrowers. Forbearance was also more common among borrowers at a greater risk of mortgage default—specifically, first-time, minority, and low- and moderate-income homebuyers with mortgages insured by the Federal Housing Administration and rural homebuyers with loans guaranteed by the Rural Housing Service (see fig. 1). Figure 1: Estimated Percentage of Single-Family Mortgage Loans in Forbearance, by Loan Type (January 2020–February 2021) A small percentage of borrowers who missed payments during the pandemic have not used forbearance—less than 1 percent of those covered by the CARES Act. Yet, borrowers who have not used forbearance may be at a greater risk of default and foreclosure, according to GAO's analysis of the National Mortgage Database. For example, these borrowers tended to have lower subprime credit scores, indicating an elevated risk of default, compared to borrowers who were current or in forbearance, who tended to have higher prime or near prime credit scores. Federal agencies and the government-sponsored enterprises Fannie Mae and Freddie Mac (the enterprises) have taken steps to make these borrowers aware of forbearance options, such as through direct phone calls and letters. In addition, the Consumer Financial Protection Bureau (CFPB) amended mortgage servicing rules in June 2021 to require servicers to discuss forbearance options with borrowers shortly after any delinquency. Foreclosures declined significantly during the pandemic because of federal moratoriums that prohibited foreclosures. The number of mortgages entering foreclosure decreased by about 85 percent on a year-over-year basis from June 2019 to June 2020 and remained as low through February 2021, according to mortgage data provider Black Knight (see fig. 2). Figure 2: Number of Single-Family Mortgage Loans Entering Foreclosure, by Month (June 2019–February 2021) Note: Foreclosure data were only available through February 2021 at the time of our review. The number of new foreclosures includes vacant and abandoned properties and non-federally backed loans, which the CARES Act did not cover. Federal entities have taken additional steps to limit pandemic-related mortgage defaults and foreclosures. Federal housing agencies and the enterprises have expanded forbearance options to provide borrowers with additional time to enter and remain in forbearance. In addition, they streamlined and introduced new loss mitigation options to help borrowers reinstate their loans after forbearance, including options to defer missed payments until the end of a mortgage. Borrowers in extended forbearances generally have large expected repayments—an average of $8,300 as of February 2021, according to the National Mortgage Database. As a result, delinquent borrowers exiting forbearance have most commonly deferred repayment, according to the Mortgage Bankers Association. Further, CFPB's amended mortgage servicing rules allow servicers to streamline processing of loss mitigation actions and establish procedural safeguards to help limit avoidable foreclosures until January 1, 2022. The risk of a spike in defaults and foreclosures is further mitigated by the relatively strong equity position of borrowers due to rapid home price appreciation. Home equity—or the difference between a home's current value and any outstanding loan balances—can help borrowers with ongoing hardships avoid foreclosure by allowing them to refinance their mortgage or sell their home to pay off the remaining balance. According to GAO's analysis of the National Mortgage Database, few borrowers (about 2 percent) who were in forbearance or delinquent in February 2021 did not have home equity after accounting for home price appreciation. By comparison, during the peak of foreclosures in 2011 after the 2007–2009 financial crisis, about 17 percent of all borrowers and 44 percent of delinquent borrowers had no home equity (see fig. 3). Figure 3: Estimated Percentage of Single-Family Mortgage Borrowers without Home Equity as of 2020 and 2011, by Loan Type and Status Why GAO Did This Study Millions of mortgage borrowers continue to experience financial challenges and potential housing instability during the COVID-19 pandemic. To address these concerns, Congress, federal agencies, and the enterprises provided borrowers with options to temporarily suspend their mortgage payments and placed a moratorium on foreclosures. Both provisions begin to expire in the coming months. The CARES Act includes a provision for GAO to monitor federal efforts related to COVID-19. This report examines (1) the extent to which mortgage forbearance may have contributed to housing stability during the pandemic, (2) federal efforts to promote awareness of forbearance among delinquent borrowers, and (3) federal efforts to limit mortgage default and foreclosure risks after federal mortgage forbearance and foreclosure protections expire. GAO analyzed data on mortgage performance and the characteristics of borrowers who used forbearance from January 2020 to February 2021 using the National Mortgage Database (a federally managed, generalizable sample of single-family mortgages). GAO also reviewed data from Black Knight and the Mortgage Bankers Association on foreclosures and forbearance repayment. In addition, GAO interviewed representatives of federal entities about efforts to communicate with borrowers and limit default and foreclosure risks. To highlight potential risks, GAO also analyzed current trends in home equity among delinquent borrowers relative to the 2007–2009 financial crisis. For more information, contact John Pendleton at (202) 512-8678 or PendletonJ@gao.gov.
    [Read More…]
  • SAP Admits to Thousands of Illegal Exports of its Software Products to Iran and Enters into Non-Prosecution Agreement with DOJ
    In Crime News
    Software company, SAP SE, headquartered in Walldorf, Germany, has agreed to pay combined penalties of more than $8 million as part of a global resolution with the U.S. Departments of Justice (DOJ), Commerce and Treasury.
    [Read More…]
  • National Day of the Federated States of Micronesia
    In Crime Control and Security News
    Michael R. Pompeo, [Read More…]
  • Justice Department Joins Computational Antitrust Project at Stanford Law School
    In Crime News
    The Department of Justice announced today that it will participate in the Computational Antitrust project, hosted by the Stanford University CodeX Center and created by Professor Thibault Schrepel. The project brings together academics from law, computer science, and economics as well as developers, policymakers, and antitrust agencies from around the world to discuss how technology and automation can improve antitrust enforcement.
    [Read More…]
  • Congratulations on Seychelles’ Elections
    In Crime Control and Security News
    Morgan Ortagus, [Read More…]
  • New Jersey Man Convicted of Conspiring to Defraud IRS in Mortgage-Withholding Tax Scheme
    In Crime News
    A federal jury convicted a New Jersey man today of conspiring with individuals in Georgia, North Carolina, Virginia and New York in a “mortgage recovery” tax fraud scheme and for assisting in the filing of false returns, among other tax offenses.
    [Read More…]
  • The Untold Coronavirus Story: How the Diplomatic Security Service Helped Evacuate Americans from China
    In Crime Control and Security News
    By Eric Weiner, DSS [Read More…]
  • The Justice Department’s Hate Crimes Enforcement and Prevention Initiative Announces Newly Translated Online Hate Crimes Resources
    In Crime News
    Today, marking the 40th Anniversary of National Crime Victims’ Rights Week (NCVRW), the Justice Department’s Hate Crimes Enforcement and Prevention Initiative announced newly translated hate crimes resources in eight languages for the department’s hate crimes website, www.justice.gov/hatecrimes.
    [Read More…]
  • Attorney General Merrick B. Garland Announces Investigation of the City of Minneapolis, Minnesota, and the Minneapolis Police Department
    In Crime News
    Attorney General Merrick B. Garland announced today the Justice Department has opened a pattern or practice investigation into the City of Minneapolis (the City) and the Minneapolis Police Department (MPD). The investigation will assess all types of force used by MPD officers, including uses of force involving individuals with behavioral health disabilities and uses of force against individuals engaged in activities protected by the First Amendment. The investigation will also assess whether MPD engages in discriminatory policing. As part of the investigation the Justice Department will conduct a comprehensive review of MPD policies, training and supervision. The department will also examine MPD’s systems of accountability, including complaint intake, investigation, review, disposition and discipline. The Department of Justice will also reach out to community groups and members of the public to learn about their experiences with MPD. “The investigation I am announcing today will assess whether the Minneapolis Police Department engages in a pattern or practice of using excessive force, including during protests,” said Attorney General Garland. “Building trust between community and law enforcement will take time and effort by all of us, but we undertake this task with determination and urgency, knowing that change cannot wait.” This morning, Department of Justice officials informed Minneapolis Mayor Jacob Frey, MPD Chief Medaria Arradondo, City Attorney Jim Rowader, City Coordinator Mark Ruff, and City Council President Lisa Bender of the investigation. The department will continue to work closely with both the City and MPD as the investigation progresses. “One of the Civil Rights Division’s highest priorities is to ensure that every person in this country benefits from public safety systems that are lawful, responsive, transparent and nondiscriminatory,” said Principal Deputy Assistant Attorney General Pamela S. Karlan for the Justice Department's Civil Rights Division. “It is essential that police departments across the country use their law enforcement authority, including the authority to use force, in a manner that respects civil rights and the sanctity of human life.” “People throughout the city of Minneapolis want a public safety system that protects and serves all members of our community,” said Acting U.S. Attorney W. Anders Folk for the District of Minnesota. “This investigation by the Department of Justice provides a vital step to restore and build trust in the Minneapolis Police Department and its officers.” The investigation is being conducted pursuant to the Violent Crime Control and Law Enforcement Act of 1994, which prohibits state and local governments from engaging in a pattern or practice of conduct by law enforcement officers that deprives individuals of rights protected by the Constitution or federal law. The Act allows the Department of Justice to remedy such misconduct through civil litigation. The department will be assessing law enforcement practices under the First, Fourth and Fourteenth Amendments to the U.S. Constitution, as well as under the Safe Streets Act of 1968, Title VI of the Civil Rights Act of 1964 and Title II of the Americans with Disabilities Act. The Special Litigation Section of the Department of Justice Civil Rights Division, in Washington, D.C., and the U.S. Attorney’s Office for the District of Minnesota, in Minneapolis, are jointly conducting this investigation. Individuals with relevant information are encouraged to contact the Department of Justice via email at Community.Minneapolis@usdoj.gov or by phone at 866-432-0268. Individuals can also report civil rights violations regarding this or other matters using the Civil Rights Division’s new reporting portal, available at civilrights.justice.gov. Additional information about the Civil Rights Division is available on its website at www.justice.gov/crt. Additional information about the U.S. Attorney’s Office for the District of Minnesota is available on its website at https://www.justice.gov/usao-mn.
    [Read More…]
  • Electricity Grid Resilience: Climate Change Is Expected to Have Far-reaching Effects and DOE and FERC Should Take Actions
    In U.S GAO News
    What GAO Found Climate change is expected to have far-reaching effects on the electricity grid that could cost billions and could affect every aspect of the grid from generation, transmission, and distribution to demand for electricity, according to several reports GAO reviewed. The type and extent of these effects on the grid will vary by geographic location and other factors. For example, reports GAO reviewed stated that more frequent droughts and changing rainfall patterns may adversely affect hydroelectricity generation in Alaska and the Northwest and Southwest regions of the United States. Further, transmission capacity may be reduced or distribution lines damaged during increasing wildfire activity in some regions due to warmer temperatures and drier conditions. Moreover, climate change effects on the grid could cost utilities and customers billions, including the costs of power outages and infrastructure damage. Examples of Climate Change Effects on the Electricity Grid Since 2014, the Department of Energy (DOE) and the Federal Energy Regulatory Commission (FERC) have taken actions to enhance the resilience of the grid. For example, in 2015, DOE established a partnership with 18 utilities to plan for climate change. In 2018, FERC collected information from grid operators on grid resilience and their risks to hazards such as extreme weather. Nevertheless, opportunities exist for DOE and FERC to take additional actions to enhance grid resilience to climate change. For example, DOE identified climate change as a risk to energy infrastructure, including the grid, but it does not have an overall strategy to guide its efforts. GAO's Disaster Resilience Framework states that federal efforts can focus on risk reduction by creating resilience goals and linking those goals to an overarching strategy. Developing and implementing a department-wide strategy that defines goals and measures progress could help prioritize DOE's climate resilience efforts to ensure that resources are targeted effectively. Regarding FERC, it has not taken steps to identify or assess climate change risks to the grid and, therefore, is not well positioned to determine the actions needed to enhance resilience. Risk management involves identifying and assessing risks to understand the likelihood of impacts and their associated consequences. By doing so, FERC could then plan and implement appropriate actions to respond to the risks and achieve its objective of promoting resilience. Why GAO Did This Study According to the U.S. Global Change Research Program, changes in the earth's climate are under way and expected to increase, posing risks to the electricity grid that may affect the nation's economic and national security. Annual costs of weather-related power outages total billions of dollars and may increase with climate change, although resilience investments could help address potential effects, according to the research program. Private companies own most of the electricity grid, but the federal government plays a significant role in promoting grid resilience—the ability to adapt to changing conditions; withstand potentially disruptive events; and, if disrupted, to rapidly recover. DOE, the lead agency for grid resilience efforts, conducts research and provides information and technical assistance to industry. FERC reviews mandatory grid reliability standards. GAO was asked to examine U.S. energy infrastructure resilience. This report describes: (1) potential climate change effects on the electricity grid; and (2) actions DOE and FERC have taken since 2014 to enhance electricity grid resilience to climate change effects, and additional actions these agencies could take. GAO reviewed reports and interviewed agency officials and 55 relevant stakeholders.
    [Read More…]
  • Unaccompanied Children: Actions Needed to Improve Grant Application Reviews and Oversight of Care Facilities
    In U.S GAO News
    The Office of Refugee Resettlement's (ORR) grant announcements soliciting care providers for unaccompanied children—those without lawful immigration status and without a parent or guardian in the U.S. available to provide care and physical custody for them—lack clarity about what state licensing information is required. Further, ORR does not systematically confirm the information submitted by applicants or document a review of their past performance on ORR grants, when applicable, according to GAO's analysis of ORR documents and interviews with ORR officials. The grant announcements do not specify how applicants without a state license should show license eligibility—a criterion for receiving an ORR grant—or specify what past licensing allegations and concerns they must report. In addition, the extent to which ORR staff verify applicants' licensing information is unclear. In fiscal years 2018 and 2019, ORR awarded grants to approximately 14 facilities that were unable to serve children for 12 or more months because they remained unlicensed. In addition, ORR did not provide any documentation that staff conducted a review of past performance for the nearly 70 percent of applicants that previously held ORR grants. Without addressing these issues, ORR risks awarding grants to organizations that cannot obtain a state license or that have a history of poor performance. State licensing agencies regularly monitor ORR-funded facilities, but according to GAO's survey of these agencies, their information sharing with ORR is limited (see figure). State licensing agencies and ORR staff both said that improved information sharing would benefit their monitoring of facilities. Without such improvements, ORR may lack information about ongoing issues at its facilities. Key Survey Responses on Information-Sharing with the Office of Refugee Resettlement (ORR) by the 23 State Agencies That Licensed ORR-Funded Facilities in Fall 2019 ORR requires grantees to take corrective action to address noncompliance it identifies through monitoring, but ORR has not met some of its monitoring goals or notified grantees of the need for corrective actions in a timely manner. For example, under ORR regulations, each facility is to be audited for compliance with standards to prevent and respond to sexual abuse and harassment of children by February 22, 2019, but by April 2020, only 67 of 133 facilities had been audited. In fiscal years 2018 and 2019, ORR also did not meet its policy goals to visit each facility at least every 2 years, or to submit a report to facilities on any corrective actions identified within 30 days of a visit. Without further action, ORR will continue to not meet its own monitoring goals, which are designed to ensure the safety and well-being of children in its care. ORR is responsible for the care and placement of unaccompanied children in its custody, which it provides through grants to state-licensed care provider facilities. ORR was appropriated $1.3 billion for this program in fiscal year 2020. GAO was asked to review ORR's grant making process and oversight of its grantees. This report examines (1) how ORR considers state licensing issues and past performance in its review of grant applications; (2) state licensing agencies' oversight of ORR grantees, and how ORR and states share information; and (3) how ORR addresses grantee noncompliance. GAO reviewed ORR grant announcements and applications for fiscal years 2018 and 2019. GAO conducted a survey of 29 state licensing agencies in states with ORR facilities, and reviewed ORR monitoring documentation and corrective action reports. GAO also reviewed ORR guidance and policies, as well as relevant federal laws and regulations, and interviewed ORR officials. GAO is making eight recommendations to ORR on improving clarity in its grant announcements, communication with state licensing agencies, and monitoring of its grantees. ORR agreed with all eight recommendations. For more information, contact Kathryn A. Larin at (202) 512-7215 or larink@gao.gov.
    [Read More…]
  • Former CEO and Founder of Technology Company Pleads Guilty to Investment Fraud Scheme
    In Crime News
    The former chief executive officer (CEO) and co-founder of Trustify, Inc. (Trustify), a privately-held technology company founded in 2015 and based in Arlington, Virginia, pleaded guilty today to his involvement in a fraud scheme resulting in millions of dollars of losses to investors.
    [Read More…]
  • Peruvian National Sentenced to 90 Months in Prison for Conspiring to Defraud Thousands of Spanish-Speaking Immigrants
    In Crime News
    A Peruvian national has been sentenced to 90 months in prison for operating a series of call centers in Peru that defrauded Spanish-speaking U.S. residents by falsely threatening them with arrest, deportation and other legal consequences. In the same case, two additional Peruvian co-conspirators pleaded guilty and two others were extradited to the Southern District of Florida to face prosecution for their roles in the scheme.
    [Read More…]
  • Federal Court Restrains Toledo Pharmacy and Two Pharmacists From Dispensing Opioids or Other Controlled Substances
    In Crime News
    More from: January 15, [Read More…]
  • Priority Open Recommendations: Department of the Treasury
    In U.S GAO News
    What GAO Found In April 2020, GAO identified 31 priority recommendations for the Department of the Treasury. Since then, Treasury has implemented 14 of those recommendations by, among other things, developing a cybersecurity risk management strategy that includes key elements identified in federal guidance and by establishing a process for conducting an organization-wide cybersecurity risk assessment. In June 2021, GAO identified 4 additional priority recommendations for Treasury, bringing the total number to 21. These recommendations involve the following areas: Improving payment integrity Improving cybersecurity Improving information technology workforce planning Modernizing the U.S. financial regulatory system Improving federal financial management ( Evaluating the performance and effectiveness of tax expenditures Full implementation of these open recommendations could significantly improve Treasury's operations. Why GAO Did This Study Priority open recommendations are the GAO recommendations that warrant priority attention from heads of key departments or agencies because their implementation could save large amounts of money; improve congressional and/or executive branch decision-making on major issues; eliminate mismanagement, fraud, and abuse; or ensure that programs comply with laws and funds are legally spent, among other benefits. Since 2015 GAO has sent letters to selected agencies to highlight the importance of implementing such recommendations. For more information, contact Michelle Sager at (202) 512-6806 or sagerm@gao.gov.
    [Read More…]
  • Tax Preparer Pleads Guilty in False Returns Scheme
    In Crime News
    A Georgia woman pleaded guilty today to preparing false tax returns for clients.
    [Read More…]