A PROGRESS REPORT TO

THE PRESIDENT

FISCAL YEAR 1996

President's Council on

Integrity and Efficiency

 

Executive Council on

Integrity and Efficiency
CONTENTS

FOREWORD

THE INSPECTORS GENERAL ............................................. . 1

REPORT OF THE PRESIDENT'S COUNCIL ON INTEGRITY AND EFFICIENCY

Audits and Inspections ................................................... . 3

Investigations ......................................................... . 8

PCIE Projects and Committees ........................................... . 12

Endnotes ............................................................ . 15

Membership Addresses ................................................. . 17

Inspector General Hotline Numbers ........................................ . 18

REPORT OF THE EXECUTIVE COUNCIL ON INTEGRITY AND EFFICIENCY

Audits and Inspections .................................................. . 19

Investigations ........................................................ . 24

Membership Addresses ................................................. . 27

Inspector General Hotline Numbers ........................................ . 28

GLOSSARY OF ACRONYMS AND ABBREVIATIONS ......................... . 29
FOREWORD

We are pleased to present the fourth joint annual report of the President's Council on

Integrity and Efficiency (PCIE) and the Executive Council on Integrity and Efficiency

(ECIE). This report highlights the accomplishments of the Federal Inspectors General

(IGs) during Fiscal Year (FY) 1996.

The impact of the combined councils in dollars alone was impressive during the year. 

Based on recommendations from the IGs, agency managers agreed to change their

spending plans for $15.1 billion, which can now be put to better use. Also as a result of

IG recommendations, managers agreed to cancel or seek reimbursement of over $5.5

billion in questioned costs.

IG investigations in FY 1996 resulted in the recovery of more than $1.1 billion from

companies and people who defrauded the Federal Government. In addition, IG investigative work resulted in 12,508 successful criminal prosecutions of wrongdoers and

4,633 debarments, exclusions and suspensions of firms or individuals doing business with

the Government.

IGs also work together to improve the economy, efficiency and effectiveness of Government operations and programs. This year, PCIE and ECIE committees explored

issues of common interest and concern, including a survey of the Offices of Inspector

General on their involvement in Government Performance and Results Act activities and

finalization of a Government-wide "master contract" that all IGs can use for their

independent public accountant contract needs.

We would like to thank the IG at the Department of Education for the professional

coordination and production of this year's report.

June Gibbs Brown Thomas D. Blair

Vice Chair Vice Chair

President's Council on Executive Council on

 Integrity and Efficiency Integrity and Efficiency
The Inspectors General

IG MISSION AND HISTORY

The term "Inspector General" (IG) has been familiar to

the military since the founding of the republic. The

traditional role of the military IG has been to

determine the operational readiness of our combat

forces. The mission of the civilian IGs, however, is

quite different. The civilian IGs harness the audit and

investigative resources of their agencies for the express

purpose of promoting economy, efficiency and

effectiveness and preventing and reducing fraud, waste

and abuse.

Prior to the 1970s, agencies experimented with adapting the military IG concept to civilian use with some

success. The IGs identified widespread fraud, waste,

abuse and scandals in agricultural, health and welfare

programs which alarmed the government. Congressional hearings were held to explore ways in which the

defects in these programs might be addressed.

Congress felt that one way of addressing the defects

would be to create a more permanent civilian IG

structure. In a series of enactments beginning in 1976,

Congress moved to establish statutory IGs with greater

independence by placing them outside the administrative control of agency program officials, giving them specific authorities, and requiring direct

reporting to Congress.

The legislation that created IGs, P.L. 95-452, The

Inspector General Act of 1978, enacted October 12,

1978, as amended, creates "independent and objective

units:

(1) to conduct and supervise audits and investigations relating to programs and operations ...;

(2) to provide leadership and coordination and recommend policies for activities designed:

(A) to promote economy, efficiency and effectiveness in the administration of, and

(B) to prevent and detect fraud and abuse in,

such programs and operations; and

(3) to provide a means for keeping the head of the

establishment and the Congress fully and currently informed about problems and deficiencies..."

APPOINTMENT AND STRUCTURE

Inspectors General are appointed without regard to

political affiliation, solely on the basis of integrity and

demonstrated ability in accounting, auditing, financial

analysis, public administration, or investigations.

There are two types of Inspectors General, which vary

by appointment authority. There are 27 Presidentially

appointed IGs covering 29 agencies. They meet,

together with other fraud-fighting officials, as the President's Council on Integrity and Efficiency (PCIE),

established by executive order on March 26, 1981.

There are 29 agency-head appointed IGs in the executive branch, plus one statutorily created agencyhead appointed IG in the legislative branch. They

meet together in a similar council called the Executive

Council on Integrity and Efficiency (ECIE), established by executive order on May 11, 1992.

All PCIE and ECIE Offices of Inspector General

(OIGs) are required to:

(1) perform comprehensive audits of programs, operations, grantees and contractors of the agency;

and

(2) conduct criminal, civil and administrative investigations of those individuals and entities that

may have engaged in fraud or otherwise violated

laws and regulations designed to ensure and

protect the government's programs, beneficiaries

and taxpayers. Some ECIE OIGs do not have

separate investigative offices, but would be

responsible for arranging for any internal investigations within their agencies.

Many OIGs also have inspection or special review

units, which conduct evaluations or perform management studies to help prevent loss and assure efficient

and effective program administration and delivery of

services. IGs also review existing and proposed legislation and regulations for their potential impact on

agency economy and efficiency and for their susceptibility to fraud and abuse.

Inspectors General have a dual reporting responsibility

to the agency head and to the Congress. By statute

they report semiannually to the Congress, describing

programmatic and administrative problems
— 2 —

and listing significant recommendations to address the IG should be viewed as a key element in any efthese problems; summarizing cost savings and funds fective management program. The IGs act as indeavailable for better or more efficient use; and sum- pendent fact-gatherers with no vested interest in parmarizing prosecutive referrals made, convictions ticular programs or operations; may perform services

obtained, and administrative actions taken or under- at the request of the agency head; and serve as techway. nical advisors in such areas as financial management

systems and internal controls. The IGs made a strong

This dual reporting requirement, along with the IGs'

statutory authority to control OIG resources and work

(with a few specific exceptions in some agencies), is

key to the IGs' independence in ensuring the objective

examination and public disclosure of program

weaknesses. By reporting to the agency head as well

as to Congress, Inspectors General can better assure

both their independence and prompt attention to their thorities, private entities or other organizations to acreports. complish their mission. Agency program managers

EFFICIENCY AND EFFECTIVENESS

Inspectors General and management pursue the same

ultimate objective: the efficient and effective operation

of programs and delivery of services. Indeed,

statement regarding their concern for program

improvement in their Inspector General Vision Statement, which outlined how IGs will work with management to achieve "positive change" in Federal

programs.

OIGs may work in cooperation with state or local auare frequently involved in the formulation of ideas for

the OIG workplan. Anyone may request that the IG

conduct a specific audit, investigation or study with the

asurance that the identity of the requester will not be

revealed. The IGs also work together through the

PCIE or the ECIE as the need arises to examine issues

of major significance. The attached reports summarize

the councils' work during FY 1996.

For regularly updated information on the IG community, please access IGnet at

http://www.sba.gov/ignet
— 3 —

The President's Council

on Integrity and Efficiency

The President's Council on Integrity and Efficiency, comprised primarily of the Presidentially appointed

Inspectors General, was created by Presidential executive order on March 26, 1981 (updated in 1986 and

1992). The PCIE works to address integrity, economy and effectiveness issues that transcend individual

government agencies; and to increase the professionalism and effectiveness of IG personnel throughout the

government. The PCIE is chaired by the Deputy Director for Management of the Office of Management and

Budget (OMB). In addition to the Presidentially appointed IGs, members include the Controller of the Office

of Federal Financial Management, the Special Counsel of the Office of Special Counsel, the Director of the

Office of Government Ethics, the Deputy Director of the Office of Personnel Management, and a

representative of the Director of the Federal Bureau of Investigation.

The following report summarizes the statistical accomplishments of the PCIE IGs and the actions of the PCIE

committees for Fiscal Year (FY) 1996. The individual IG semiannual reports to Congress have narrative

examples of these statistical accomplishments and the IGs' recommendations for program improvements.

AUDITS AND INSPECTIONS

The majority of OIG resources are devoted to audits. The OIGs conduct audits using their own staff; they also

supervise, coordinate or review audits performed by other Federal auditors, state and local government auditors and

independent public accounting firms under contract to the Federal government or the auditee. Inspections are akin

to policy and program evaluations, and are designed to support the overall mission of OIGs to promote economy,

efficiency and effectiveness in program administration.

The following tables demonstrate the impact of OIG audits and inspections. The tables summarize key statistical

accomplishments reported in the individual IG semiannual reports to Congress for the 6-month periods ended March

31 and September 30, 1996. These statistical accomplishments relate to recommendations that funds be put to better

use; management decisions on recommendations that funds be put to better use; questioned costs; and management

decisions on questioned costs.

RECOMMENDATIONS THAT FUNDS

BE PUT TO BETTER USE

The Inspector General Act defines a recommendation

that funds be put to better use as "a recommendation by

the Office that funds could be used more efficiently if

management of an establishment took actions to

implement and complete the recommendation, including (A) reductions in outlays; (B) deobligations of

funds from programs or operations; (C) withdrawal of

interest subsidy costs on loans or loan guarantees,

insurance, or bonds; (D) costs not incurred by implementing recommended improvements related to the

operations of the establishment, a contractor or grantee; (E) avoidance of unnecessary expenditures noted

in preaward reviews of contract or grant agreements;

or (F) any other savings which are specifically identified."

During FY 1996, OIG audits and inspections recommended that over $5.8 billion be put to better use. In

conjunction with the Defense Contract Audit Agency

(DCAA), OIGs recommended that a total of over $10.1

billion to be put to better use (Table I).

The tables on the following pages present, by agency, the amount of funds recommended for better use by Offices of

Inspector General in audits and inspection reports issued during FY 1996 (Table I) and the status of FY 1996

management decisions on OIG audit and inspection recommendations that funds be put to better use (Table II). Agency

managers agreed with almost $15 billion in recommendations that funds be put to better use.
— 4 —

Table I.

RECOMMENDATIONS THAT FUNDS BE PUT TO BETTER USE

FY 1996

Agency OIG DCAA Total

Agency for International Development (AID) $ 19,159,629 $ — $ 19,159,629

Department of Agriculture (USDA) 59,890,556 1,128,688 61,019,244 1/

Department of Commerce (DOC) 167,845,821 5,887,407 173,733,228 2/ 3/

Corp. for National & Community Service (CNCS) — — —

Department of Defense (DoD) 2,143,683,000 4,033,464,184 6,177,147,184

Department of Education (ED) 14,598,000 — 14,598,000

Department of Energy (DOE) 688,923,550 — 688,923,550

Environmental Protection Agency (EPA) 18,217,100 44,006,744 62,223,844

Federal Deposit Insurance Corporation (FDIC) 244,072 — 244,072 4/

Federal Emergency Management Agency (FEMA) 4,899,051 2,600,000 7,499,051

General Services Administration (GSA) 342,146,930 143,564,419 485,711,3495/

Department of Health & Human Services (HHS) 701,733,000 — 701,733,000 2/

Dept. of Housing & Urban Development (HUD) 285,000 26,000 311,000

Department of the Interior (DOI) 278,036,925 39,960 278,076,885 6/ 6/

Department of Justice (DOJ) 18,564,369 — 18,564,369

Department of Labor (DOL) 66,284,444 — 66,284,444

National Aeronautics & Space Admin. (NASA) 559,900,000 — 559,900,000 7/ 7/

Nuclear Regulatory Commission (NRC) — 214,598 214,598

Office of Personnel Management (OPM) — — —

Railroad Retirement Board (RRB) — — —

Small Business Administration (SBA) 38,389,884 — 38,389,884 8/ 8/

Social Security Administration (SSA) 100,700,000 — 100,700,000

Department of State (State) 1,235,000 — 1,235,000

Department of Transportation (DOT) 473,036,000 49,060,000 522,096,000

Department of the Treasury (Treasury) 41,777,000 3,408,000 45,185,000 9/ 9/

United States Information Agency (USIA) 2,634,000 — 2,634,000

Department of Veterans Affairs (VA) 90,500,000 16,600,000 107,100,00010/

TOTALS $ 5,832,683,331 $ 4,300,000,000 $ 10,132,683,331
— 5 —

Table II.

MANAGEMENT DECISIONS ON RECOMMENDATIONS

THAT FUNDS BE PUT TO BETTER USE

FY 1996

Agency Start FY 1996 FY 1996 to by Mgmt. to by Mgmt. End FY 1996

No Mgmt. Dec. Recs. Issued in Recs. Agreed Recs. Not Agreed No Mgmt. Dec.

AID $ 450,957 $ 19,159,629 $ 5,965,826 $ 309,028 $ 13,335,732

USDA 2,899,031,227 61,019,244 264,676,566 11,531,119 2,683,842,786

DOC 70,892,413 152,633,228 56,254,007 44,646,503 127,231,979 1/ 2/ 2/

CNCS 200,000 — 200,000 — —

DoD 23,529,219,000 6,177,147,184 8,589,275,000 6,458,322,000 14,925,805,000

ED 62,661,311 14,598,000 6,972,411 21,283,900 49,003,000

DOE 259,585,855 688,923,550 190,486,575 386,955,964 370,858,822

EPA 208,678,178 62,223,844 63,366,428 145,086,378 62,449,216 3/

FDIC — 244,072 244,072 — —

4/

FEMA 2,120,011 7,499,051 9,086,622 139,799 392,641

GSA 36,682,915 484,812,957 337,449,323 3,356,775 180,689,774 5/

HHS 8,355,010,000 701,733,000 3,819,089,000 65,992,000 5,171,662,000 6/

HUD 4,144,000 311,000 3,444,000 — 1,011,000

DOI 339,962,444 278,076,885 160,843,608 6,517,232 450,678,489

DOJ — 18,564,369 3,236,399 — 15,327,970

DOL — 66,284,444 15,900,000 — 50,400,000

NASA 9,700,000 546,400,000 464,500,000 — 91,600,000 7/

NRC — 214,598 214,598 — —

OPM — — — — —

RRB — — — — —

SBA 25,865,055 38,389,884 45,975,229 18,471,710 325,000 8/ 9/

SSA 473,494,702 100,700,000 164,578,702 — 409,807,000

State 20,351,100 1,235,000 19,981,000 — 1,605,100

DOT 265,597,000 522,096,000 385,260,000 206,173,000 149,491,000

Treasury 25,185,000 45,185,000 33,535,000 5,907,000 30,928,000 10/ 11/ 10/

USIA — 2,634,000 2,634,000 — —

VA 317,200,000 105,300,000 375,700,000 13,200,000 33,600,000 12/

TOTALS $ 36,906,031,168 $ 10,095,384,939 $ 15,018,868,366 $ 7,387,892,408 $ 24,820,044,509
— 6 —

QUESTIONED COSTS

The IG Act defines a questioned cost as "a cost that is

questioned by the Office because of (A) an alleged

violation or provision of law, regulation, contract,

grant, or cooperative agreement, or other agreement or

document governing the expenditure of funds; (B) a

finding that, at the time of the audit, such cost is not

supported by adequate documentation; or (C) a

finding that the expenditure of funds for the intended

purpose is unnecessary or unreasonable."

Table III (below) and Table IV (page 7) present, respectively: 1) the total costs questioned by OIGs in FY 1996 and

2) the total amount of management decisions to disallow costs questioned by OIGs. In FY 1996, agency managers

agreed to disallow more than $4.2 billion in questioned costs based on OIG recommendations.

Table III.

QUESTIONED COSTS

FY 1996

Agency OIG DCAA Total

AID $ 15,980,122 $ 760,939 $ 16,741,061

USDA 137,988,215 214,752 138,202,967 1/

DOC 5,126,819 — 5,126,819

CNCS 1,825,000 — 1,825,000

DoD — 3,009,417,746 3,009,417,746

ED 53,717,483 — 53,717,483

DOE 7,627,797 — 7,627,797

EPA 207,120,549 1,923,219 209,043,768

FDIC 85,613,148 — 85,613,148 2/

FEMA 11,781,317 — 11,781,317

GSA 27,272,963 — 27,272,963

HHS 214,443,600 20,400 214,464,000

HUD 41,565,000 21,000 41,586,000 3/ 3/

DOI 16,087,902 169,057 16,256,959 4/ 4/

DOJ 15,313,090 — 15,313,090

DOL 11,200,000 — 11,200,000

NASA — 163,300,000 163,300,000

NRC — 258,887 258,887

OPM 85,352,516 — 85,352,516

RRB — — —

SBA 1,774,508 — 1,774,508

SSA 363,358 — 363,358

State 67,000 — 67,000

DOT 40,522,000 25,314,000 65,836,000

Treasury 2,838,000 1,900,000 4,738,000

USIA 209,000 — 209,000

VA 18,300,000 15,300,000 33,600,000

TOTALS $ 1,002,089,387 $ 3,218,600,000 $ 4,220,689,387
— 7 —

Table IV.

MANAGEMENT DECISIONS ON AUDITS

WITH QUESTIONED COSTS

FY 1996

Agency Start FY 1996 FY 1996 Costs Disallowed End FY 1996

No Mgmt. Dec. Recs. Issued in Disallowed Costs Not No Mgmt. Dec.

AID $ 58,319,908 $ 16,741,061 $ 8,261,654 $ 56,009,318 $ 10,789,997

USDA 3,616,754,607 138,202,967 1,566,929,937 492,178,371 1,695,989,9611/

DOC 12,334,443 5,126,819 8,728,879 3,633,909 5,350,889 2/

CNCS 253,000 1,825,000 168,000 81,000 1,829,000

DoD 9,415,600,000 3,009,417,746 1,656,200,000 739,900,000 10,274,100,000

ED 550,066,482 53,717,483 60,593,372 40,871,762 502,072,7311/

DOE 13,872,077 7,627,797 192,028 3,572,582 17,510,370 3/ 3/

EPA 206,546,776 209,043,768 59,057,893 47,984,611 308,548,040

FDIC 21,278,000 85,613,148 87,915,276 19,089,612 —

4/5/

FEMA 22,459,865 11,781,317 21,566,857 2,975,272 9,141,9546/

GSA 5,596,761 27,272,963 27,307,874 608,335 5,508,442 7/

HHS 505,821,000 214,464,000 274,644,000 10,445,000 435,196,000

HUD 33,252,000 41,586,000 42,227,000 8,479,000 24,132,000 8/ 8/

DOI 55,611,025 16,256,959 13,935,827 12,026,896 45,905,261

DOJ 417,208 15,313,090 5,001,448 — 10,728,850

DOL 25,300,000 11,200,000 4,000,000 6,800,000 25,700,000

NASA 1,400,000 — 1,400,000 — —

9/

NRC 33,211 258,887 292,098 — —

OPM 34,991,690 85,352,516 70,079,034 15,779,223 34,485,949

RRB — — — — —

SBA 2,368,601 1,774,508 2,434,007 1,131,662 769,698

SSA 288,678 363,358 652,036 — —

State 635,664 67,000 76,000 — 626,664

DOT 192,023,000 65,836,000 30,898,000 87,875,000 139,235,000 2/ 2/

Treasury 8,229,000 4,738,000 2,998,000 1,585,000 8,384,000

USIA 5,282,000 209,000 1,224,000 398,000 3,869,000

VA 20,700,000 33,600,000 28,400,000 17,000,000 8,900,000

TOTALS $ 14,809,434,996 $ 4,057,389,387 $ 3,975,183,220 $ 1,568,424,553 $ 13,568,773,806
— 8 —

INVESTIGATIONS

The Inspector General Act requires IGs to provide policy direction for and to conduct, supervise and coordinate

investigations relating to their agencies' programs and operations. Investigations cover a full range of criminal and

administrative issues. Because OIGs frequently work cases with the FBI and because of the preeminent role of the

Department of Justice in law enforcement matters, the Deputy Director of the FBI is a member of PCIE and chairs

PCIE's Integrity Committee (see page 13).

The tables on the following pages illustrate the results obtained through OIG investigations in FY 1996. The accomplishments— successful criminal prosecutions, administrative sanctions and investigative recoveries— include the

results of joint investigations. (On average, in FY 1996, OIGs conducted 6.65 percent of their investigations with other

OIGs and 17.2 percent with non-OIG investigative agencies.)

SUCCESSFUL CRIMINAL PROSECUTIONS

OIG investigations of contractors, program participants and government employees can lead to criminal

prosecutions. These prosecutions, when successful,

result in convictions that carry penalties such as prison

terms, fines, settlements, and recoveries to the

government. During FY 1996, OIGs working independently, or with other Federal and non-Federal investigative agencies, obtained 3,372 successful criminal prosecutions, including pretrial diversions (Table

V).

Table V.

SUCCESSFUL CRIMINAL PROSECUTIONS

FY 1996

Agency Total Agency Total

Agency for International Development 5 Department of Justice 129

Department of Agriculture 738 Department of Labor 189

Department of Commerce 4 National Aeronautics & Space Admin. 42

Corporation for National Service 1 Nuclear Regulatory Commission 5

Department of Defense 292 Office of Personnel Management 15

Department of Education 58 Railroad Retirement Board 135

Department of Energy 41 Small Business Administration 69

Environmental Protection Agency 11 Social Security Administration 570

Federal Deposit Insurance Corporation 34 Department of State 10 1/

Federal Emergency Management Agency 22 Department of Transportation 127

General Services Administration 25 Department of the Treasury 3162/

Department of Health & Human Services 151 United States Information Agency 2

Department of Housing & Urban Development 198 Department of Veterans Affairs 138

Department of the Interior 45

TOTAL 3,372
— 9 —

INVESTIGATIVE RECOVERIES

Investigations conducted by OIGs often lead to recovery of money or property. The recoveries reported here

are the total dollar value of repayments, payments

ordered, settlements made pursuant to legal actions,

and/or administrative monetary penalties. 

They include recoveries made during investigations,

legally ordered fines and penalties, restitutions and

recoveries, out-of-court settlements, and penalties imposed through administrative proceedings. In FY 1996

OIG investigative recoveries totaled over $995.6

million. Those recoveries go to the U.S. Treasury; to

program, trust, or operating funds; and to other

Federal and nonfederal entities victimized.

Table VI depicts the amount of investigative recoveries resulting from the efforts of PCIE members in FY 1996.

Table VI.

INVESTIGATIVE RECOVERIES

FY 1996

Agency Total

Agency for International Development $ 2,654,4911/

Department of Agriculture 69,889,771

Department of Commerce 1,067,034

Corporation for National Service 3,497

Department of Defense 292,424,629

Department of Education 9,427,400

Department of Energy 40,335,4642/

Environmental Protection Agency 5,601,8373/

Federal Deposit Insurance Corporation 10,867,4894/

Federal Emergency Management Agency 14,047,579

General Services Administration 25,260,906

Department of Health & Human Services 235,500,000

Dept. of Housing & Urban Development 41,815,521

Department of the Interior 2,329,745

Department of Justice 910,693

Department of Labor 36,510,258

National Aeronautics & Space Admin. 48,900,000

Nuclear Regulatory Commission 73,970

Office of Personnel Management 8,789,29965/

Railroad Retirement Board 4,098,619

Small Business Administration 20,467,211

Social Security Administration 22,768,372

Department of State 637,360

Department of Transportation 16,923,667

Department of the Treasury 16,056,0916/

United States Information Agency 260

Department of Veterans Affairs 68,300,000

TOTAL $ 995,661,1637/
— 10 —

SUSPENSIONS/DEBARMENTS

In FY 1996, a total of 4,609 debarments, exclusions and suspensions were imposed upon individuals and entities doing

business with the Federal government as a result of OIG investigations. Since 1981, OIG investigations have led to

35,423 administrative sanctions.

Table VII.

SUSPENSIONS/DEBARMENTS

FY 1996

Agency Total

Agency for International Development 1

Department of Agriculture 992

Department of Commerce —

Corporation for National Service —

Department of Defense 324

Department of Education 24

Department of Energy 20

Environmental Protection Agency 17

Federal Deposit Insurance Corporation 6

1/

Federal Emergency Management Agency —

General Services Administration 247

Department of Health & Human Services 1,408

Dept. of Housing & Urban Development 102

Department of the Interior 3

Department of Justice —

Department of Labor 73

National Aeronautics & Space Admin. 38

Nuclear Regulatory Commission —

Office of Personnel Management 1,259

Railroad Retirement Board —

Small Business Administration 4

Social Security Administration —

Department of State 1

Department of Transportation 37

Department of the Treasury 7

United States Information Agency —

Department of Veterans Affairs 46

TOTAL 4,609
— 11 —

PERSONNEL ACTIONS

IGs are also responsible for investigating employees suspected of wrongdoing. In FY 1996, OIG investigations led to

1,972 personnel actions against employees (Table VIII). These personnel actions included terminations, reprimands,

suspensions and demotions.

Table VIII.

PERSONNEL ACTIONS

FY 1996

Agency Total

Agency for International Development 2

Department of Agriculture 55

Department of Commerce 46

Corporation for National Service 3

Department of Defense 169

Department of Education 5

Department of Energy 2471/

Environmental Protection Agency 21

Federal Deposit Insurance Corporation 142/

Federal Emergency Management Agency 3

General Services Administration 34

Department of Health & Human Services 13

Dept. of Housing & Urban Development 8

Department of the Interior 58

Department of Justice 108

Department of Labor 65

National Aeronautics & Space Admin. 48

Nuclear Regulatory Commission 57

Office of Personnel Management 3

Railroad Retirement Board 4

Small Business Administration 4

Social Security Administration 11

Department of State 33

Department of Transportation 23

Department of the Treasury 8953/

United States Information Agency —

Department of Veterans Affairs 43

TOTAL 1,972
— 12 —

PCIE PROJECTS AND COMMITTEES

The PCIE, in conjunction with the ECIE, maintains committees to examine important issues to assist them in their

ongoing efforts to improve the effectiveness of their members in fighting fraud, waste and abuse across the Federal

government. The following synopses highlight the FY 1996 activities and accomplishments of the PCIE committees.

AUDIT COMMITTEE

(Chair: Valerie Lau, Inspector General, Department

of the Treasury)

The Audit Committee undertook or completed several

important initiatives during FY 1996:

< Professional guides. The committee has undertaken the updating of two important professional

guides used by the IG community. In association

with the Federal Audit Executive Council, the

Audit Committee is updating the PCIE Audit

Peer Review Manual (APRM), which is used to

assure the quality and professionalism of audit

functions. The revised APRM, expected to be

issued in 1997, will incorporate recent changes to

the Government Audit Standards and improve

the quality and completeness of future peer

reviews.

The committee has also formed a task group to

revise the PCIE Federal Financial Statement

Audit Manual (FFSAM) in response to changes

in government financial management practices

mandated by legislation such as the Chief Financial Officers Act and the Government Management Reform Act. The PCIE will be working

with the General Accounting Office and the

private-sector auditing and accounting community to assure that the FFSAM addresses the many

new issues emerging in government financial

management.

< Master contract. The committee finalized plans

to establish a PCIE-wide "master contract,"

which all OIGs can use for their independent

public accountant (IPA) contract needs. Professional services available through the master

contract will include not only traditional auditand accounting-related services, but specialties

such as statisticians, actuaries, economists, electronic data processing auditing services, and

other technical skills as they relate to audit activities. Much of the credit for this important

initiative is due the Department of Labor OIG,

the master contract's host agency.

< Evaluation of FECA programs. As an Audit

Committee project, the Department of Labor IG

issued a report summarizing the results of 13

OIG audits evaluating the efficiency and effectiveness of Federal Employees' Compensation

Act (FECA) programs. The participating IGs

disclosed that the employing agencies generally

need to improve the management of their workers' compensation programs.

Several recommendations in the IG reports addressed the need to improve procedures for returning injured employees to work, verifying

charge-back reports and processing FECA claim

forms. Agency officials generally agreed there is

significant potential for improved cost containment and oversight.

INSPECTION AND EVALUATION

COMMITTEE

(Chair: James F. Hoobler, Inspector General, Small

Business Administration)

The Inspection and Evaluation Committee's accomplishments during FY 1996 included the following.

< Reports. The committee produced two reports,

which are described below.

— Accountability for Block Grants, issued in

July 1996, documents existing provisions

for accountability in the 13 Federal block

grant programs. The review identifies general accountability concepts, discusses

specific issues concerning block grant statutes, and suggests ways to modify existing

block grant programs to improve their accountability.

— The second report, Survey of Office of

Inspector General Involvement in GPRA

Activities, issued in August 1996, examines

the OIGs' role in their host agencies'

implementation of the Government Performance and Results Act (GPRA). Conducted jointly with the PCIE Audit Committee,

the survey found that nearly all of the IGs

appointed by the President and about half of
— 13 —

the agency-appointed IGs were The executive order also establishes the

involved in their agencies' efforts to membership of the Integrity Committee, to

meet GPRA requirements. consist of:

Both reports were prepared by the Inspections

Roundtable at the request of the chairman of the

Inspection and Evaluation Committee.

< Inspections Roundtable. The committee also

oversaw several other initiatives of the Inspections Roundtable.

— Inspection services. Teams of inspection

managers were made available to discuss

the different types of inspection services

and products and how they might meet the

needs of the Inspector General community.

The teams met separately with four IGs who

were considering forming or reorganizing

inspection functions within their offices.

— IGnet. The Roundtable also worked closely

with the directors of IGnet on two projects:

1) development of a library of inspection

report abstracts for public reference via the

Internet; and 2) creation of a training

resource on IGnet to help inspection

personnel identify worthwhile training

opportunities.

— Professional development program. In

collaboration with the committee, the Inspections Roundtable began planning for a

professional development program for the

inspections community, including interagency training specifically tailored for inspection staff and an executive seminar for

senior inspection managers.

INTEGRITY COMMITTEE

(Chair: Robert Bryant, Assistant Director, Criminal

Investigative Division, Federal Bureau of Investigation)

The Integrity Committee's activities and accomplishments during the fiscal year included a broad range of

issues.

< Executive order. Executive Order 12993 was

signed by the President in March 1996. This

order formally recognizes the Integrity Committee and specifically tasks it to receive, review,

and refer for investigation allegations of wrongdoing against an Inspector General or an IG staff

member.

1) the FBI official serving on the PCIE (currently the Assistant Director of the Criminal Investigative Division), who serves as

chair;

2) the Special Counsel of the Office of Special

Counsel;

3) the Director of the Office of Government

Ethics; and

4) three Inspectors General, representing both

the PCIE and the ECIE, who are appointed

by the Deputy Director for Management of

OMB, who chairs both councils.

< Policies and procedures. In FY 1996, the Integrity Committee worked toward the formalization of its policies and procedures. These procedures, now officially signed, provide a framework for the committee's investigative function.

LEGISLATION COMMITTEE

(Chair: Jeffrey Rush, Inspector General, Agency for

International Development)

The Legislation Committee's FY 1996 accomplishments and activities included the following.

< Referrals. The Legislation Committee is responsible for reviewing draft legislation that is

sent to OMB for comment as well as draft bills

that contain provisions of interest to the IG

community. This year the committee received for

comment 27 referrals of proposed legislation and

testimony from the Office of Management and

Budget.

< Legislation. The committee completed several

important legislative initiatives, including the

following.

— IG Act hearing follow-up. The Legislation

Committee met with staff of the Senate

Subcommittee on Government Management, Information and Technology to

discuss matters of interest. Among these

are cooperative agreements for investigation

services, consolidation of reports, information technology, audit planning, and

testimonial subpoena authority.

— Asset forfeiture/equitable sharing. The

committee conducted a survey of PCIE In-
— 14 —

spectors General on the subject of < Forums. The PDC hosted a number of forums

forfeiture and equitable sharing and covering a wide variety of technical and manmet with the Department of Justice to agement topics providing professional education

discuss asset forfeiture. credits. These topics ranged from "How InPROFESSIONAL DEVELOPMENT

COMMITTEE

(Chair: David Williams, Inspector General, Social

Security Administration)

During FY 1996, activities and accomplishments of

the Professional Development Committee (PDC) included the following.

spectors General Confront Change" to "The Office of the Future, Computers" and "IGs and

CFOs [Chief Financial Officers]: Coming Together in Changing Times." These forums allowed members of the PCIE and ECIE, and

others in the IG community, to exchange information and knowledge of emerging issues that

might result in a more efficient way of conducting business.

< Publications. The PDC issued its third Journal

of Public Inquiry, a publication that focuses on

issues of interest to the IG community.
— 15 —

ENDNOTES

Recommendations that Funds Be Put to Better Use (page 4)

Includes $615,340 in recommendations from work performed by nonfederal auditors. 1/

Includes recommendations from inspection activities. 2/

Is $21.1 million greater than the comparable number in Table II. Includes inspection results not tracked by audit follow-up system. 3/

Includes FDIC/OIG data for the period plus that portion of Resolution Trust Corporation (RTC) OIG data from 10/1/95 through and including 12/31/96. 4/

The difference between this figure and the figure in Tab le II, column 3, represents recommendations in a final audit report issued in FY 1996 that has been 5/

removed from the resolution process due to continuing litigation activity.

Includes $7,973,174 in indirect cost proposals negotiated by OIG. 6/

Includes $13.5 million from investigative activities, not included in audit follow-up system. 7/

Includes cost avoidances of $38,064,884 from investigative activities. 8/

Includes 7 IRS inspection reports containing recommendations with a dollar value totaling $23,984,000. 9/

Is $1.8 million greater than comparable number in Table I. Includes $1.8 million in investigative activities, not included in audit follow-up system .

10/

Management Decisions on Recommendations that Funds Be Put to Better Use (page 5)

Is $21.1 million less than comparable number in Table I, which includes inspection results not tracked by audit follow-up system. 1/

Management agreed to funds to be put to better use in excess of recommended amounts. 2/

Includes $43,343,643 in non-awards or unsuccessful bids. 3/

Includes FDIC/OIG data for the period plus that portion of RTC/OIG data from 10/1/95 through and including 12/31/96. 4/

The difference between this figure and the fi gure in Table I, column 3, represents recommendations in a final audit report issued in FY 1996 that has been 5/

removed from the resolution process due to continuing litigation activity.

Includes recommendations from inspection activities. 6/

Is $13.5 million less than comparable number in Table I, which includes investigative activities, not included in audit follow-up system .

7/

Includes cost avoidances in the amount of $38,064,884 from Investigation Division activities. 8/

Includes $517,000 for which no original audit recommendation was made. 9/

Includes 7 IRS inspection reports containing recommendations with a dollar value totaling $23,984,000. 10/

Includes 10 OIG reports that were partially agreed to and partially not agreed to. 11/

Is $1.8 million less than comparable number in Table I, which includes $1.8 million in investigative activities, not included in audit follow-up system .

12/

Questioned Costs (page 6)

Includes $48,607,776 in recommendations from work performed by nonfederal auditors. 1/

Includes FDIC/OIG data for the period plus that portion of RTC/OIG data from 10/1/95 through and including 12/31/96. 2/

Includes $3,458,000 in costs questioned by audits and reviews under the Operation Safe Home Multifamily Equity Skimming effort. These costs were 3/

not included in issued audit reports.

Includes questioned costs of $13,912,830 in single audit reports. 4/

Management Decisions on Audits with Questioned Costs (page 7)

Because of adjustments in management decisions during the course of the fiscal year, there was a variance between the beginning and ending balances 1/

for FY 1996.

Management agreed to disallow costs in excess of the amount questioned on certain audits. 2/

$224,894 did not require a management decision and is deducted from column 3. 3/

Includes FDIC/OIG data for the period plus that portion of RTC/OIG data from 10/1/95 through and including 12/31/96. 4/

A small difference exists between the sum of the amounts in the first two columns and the sum of the amounts in the next two columns. This difference 5/

is the result of: 1) management's disallowance of $111,030 more than the OIG questioned; and 2) rounding.

This amount does not include $557,099 which is currently in appeal status. 6/

Management decided to seek $554,927 that exceeded recommended amounts. 7/

Includes $3,458,000 in costs questioned by audits and reviews under the Operation Safe Home Multifamily Equity Skimming effort. These costs were 8/

not included in issued audit reports.

Figures reflect only NASA/OIG audit activity and do not include DCAA audits. 9/

Successful Prosecutions (page 8)

Includes FDIC/OIG data for the period plus that portion of RTC/OIG data from 10/1/95 through and including 12/31/96. 1/

Includes 300 non-OIG prosecutive actions from Treasury's Law Enforcement Bureaus— the Bureau of Alcohol, Tobacco and Firearms (ATF); the United 2/

States Customs Service (Customs); the Internal Revenue Service (IRS); and the United States Secret Service (Secret Service)— over which Treasury OIG

has oversight responsibility.

ENDNOTES
— 16 —

Investigative Recoveries (page 9)

$400,000 of this amount reflects a DOJ settlement that occurred on September 29, 1995, but was reported during FY 1996. 1/

Includes $27,656 from inspections. 2/

Includes additional amounts not shown in EPA's Semiannual Report to Congress.

3/

Includes FDIC/OIG data for the period plus that portion of RTC/OIG data from 10/1/95 through and including 12/31/96. 4/

$7 million of this amount was the result of the joint efforts of OIG auditors and investigators and is also reflected in Table IV. 5/

Includes $14,035,755 in recoveries by Treasury's Law Enforcement Bureaus— ATF, Customs, IRS and Secret Service— over which Treasury OIG has 6/

oversight responsibility.

Total includes $10 million reported by three agencies— DoD, GSA and VA— as recoveries as the result of a joint investigation. The amounts reported 7/

by these agencies may overlap.

Suspensions/Debarments (page 10)

Includes FDIC/OIG data for the period plus that portion of RTC/OIG data from 10/1/95 through and including 12/31/96. 1/

Personnel Actions (page 11)

Includes 18 personnel actions from the Office of Inspections. 1/

Includes FDIC/OIG data for the period plus that portion of RTC/OIG data from 10/1/95 through and including 12/31/96. 2/

Includes 845 non-OIG personnel actions by Treasury's Law Enforcement Bureaus— ATF, Customs, IRS and Secret Service— over which Treasury OIG 3/

has oversight responsibility.
— 17 —

MEMBERSHIP OF THE PRESIDENT'S COUNCIL ON INTEGRITY AND EFFICIENCY

John A. Koskinen, Chair, PCIE

Deputy Director for Management Criminal Investigative Division OFFICE OF PERSONNEL MANAGEMENT

OFFICE OF MANAGEMENT AND BUDGET FEDERAL BUREAU OF INVESTIGATION 1900 E Street, NW, Room 6400

17th & Pennsylvania Ave., NW Ninth St. & Pennsylvania Ave., NW Washington, D.C. 20415-0001

Washington, D.C. 20503 Room 7116

June Gibbs Brown, Inspector General

DEPT. OF HEALTH & HUMAN SERVICES 1730 M Street, NW, Suite 300

Vice Chair, PCIE FEDERAL DEPOSIT INSURANCE CORPORATION Washington, D.C. 20036

330 Independence Ave., SW, Rm. 5250 801 17th St., NW, Room 1096

Washington, D.C. 20201 Washington, D.C. 20434-0001

Thomas D. Blair, Inspector General

SMITHSONIAN INSTITUTION FEDERAL EMERGENCY MANAGEMENT AGCY. Chicago, IL 60611-2092

Vice Chair, ECIE 500 C Street, SW, Suite 505

955 L'Enfant Plaza, Room 7600 Washington, D.C. 20472

Mail Stop: 905

Washington, D.C. 20560

— — —

Washington, D.C. 20405 Jeffrey Rush, Jr., Inspector General

AGENCY FOR INTERNATIONAL DEVELOPMENT

320 21st St., NW, Rm. 5756 NS

Washington, D.C. 20523-0060

Washington, D.C. 20005-3917 Roger C. Viadero, Inspector General

DEPARTMENT OF AGRICULTURE

Room 117-W

1400 Independence Ave., SW

Washington, D.C. 20250-2301

Washington, D.C. 20410-4500 2201 C Street, NW, Room 6817 Frederick P. Hitz, Inspector General

CENTRAL INTELLIGENCE AGENCY

Room 2X30 New Headquarters

Washington, D.C. 20505

Washington, D.C. 20240 400 Seventh Street, SW, Room 9210 Frank DeGeorge, Inspector General

DEPARTMENT OF COMMERCE

14th & Constitution Ave., NW, Rm. 7898C

Washington, D.C. 20230

10th Street and Constitution Avenue, NW 1500 Pennsylvania Avenue, NW Luise S. Jordan, Inspector General

CORPORATION FOR NATIONAL SERVICE

1201 New York Ave., NW, Suite 8100

Washington, D.C. 20525

Room S-1303 Inspector General Eleanor Hill, Inspector General

DEPARTMENT OF DEFENSE

400 Army Navy Drive, Room 1000

Arlington, VA 22202-2884

NATIONAL AERONAUTICS & SPACE ADMIN.

Thomas R. Bloom, Inspector General

DEPARTMENT OF EDUCATION

330 C Street, SW, Room 4006

Washington, D.C. 20202-1510

NUCLEAR REGULATORY COMMISSION John C. Layton, Inspector General

DEPARTMENT OF ENERGY

1000 Independence Ave., SW, Rm. 5D-039

Washington, D.C. 20585

Office of Federal Financial Management Nikki L. Tinsley, Acting Inspector General

ENVIRONMENTAL PROTECTION AGENCY

401 M Street, SW, Rm. NE3309 (2410)

Washington, D.C. 20460

Robert Bryant, Assistant Director Patrick E. McFarland, Inspector General

Washington, D.C. 20535

Gaston L. Gianni, Jr., Inspector General

George J. Opfer, Inspector General

William R. Barton, Inspector General

GENERAL SERVICES ADMINISTRATION Washington, D.C. 20416

18th and F Streets, NW, Room 5340

Stephen D. Potts, Director

OFFICE OF GOVERNMENT ETHICS Altmeyer Building, Suite 300

1201 New York Avenue, NW, Suite 500 Baltimore, MD 21235

Susan Gaffney, Inspector General

DEPARTMENT OF HOUSING AND URBAN DEPARTMENT OF STATE

DEVELOPMENT ARMS CONTROL AND DISARMAMENT AGENCY

451 7th Street, SW, Room 8256 UNITED STATES INFORMATION AGENCY

Wilma Lewis, Inspector General

DEPARTMENT OF THE INTERIOR

1849 C Street, NW, Mail Stop 5341 DEPARTMENT OF TRANSPORTATION

Michael R. Bromwich, Inspector General

DEPARTMENT OF JUSTICE

Room 4706, Main Justice Building DEPARTMENT OF THE TREASURY

Washington, D.C. 20530 Room 2412 Main Treasury Building

Charles C. Masten, Inspector General

DEPARTMENT OF LABOR

200 Constitution Avenue, NW DEPARTMENT OF VETERANS AFFAIRS

Washington, D.C. 20210 810 Vermont Avenue, NW, Room 1114TW

Roberta L. Gross, Inspector General

300 E Street, SW, Code W, Room 8V69

Washington, D.C. 20546

Hubert T. Bell, Inspector General

Mail Stop T5 D28

Washington, D.C. 20555

G. Edward DeSeve, Controller

OFFICE OF MANAGEMENT AND BUDGET

17th St. & Pennsylvania Ave., NW

Room 260

Washington, D.C. 20503

Kathleen Day Koch, Special Counsel

OFFICE OF SPECIAL COUNSEL

Martin J. Dickman, Inspector General

RAILROAD RETIREMENT BOARD

844 North Rush Street, Room 450

James F. Hoobler, Inspector General

SMALL BUSINESS ADMINISTRATION

409 3rd Street, SW, 7th Floor

David C. Williams, Inspector General

SOCIAL SECURITY ADMINISTRATION

6401 Security Boulevard

Jacquelyn Williams-Bridgers, Inspector

 General

Washington, D.C. 20520-6817

Kenneth Mead, Inspector General

Washington, D.C. 20590

Valerie Lau, Inspector General

Washington, D.C. 20220

William T. Merriman, Deputy

Washington, D.C. 20420

NOTE: OIG semiannual reports are

available electronically on the PCIE

website, IGnet, at

http://www.sba.gov/ignet.
— 18 —

INSPECTOR GENERAL HOTLINE NUMBERS

- PCIE Members -

AGENCY FOR INTERNATIONAL FEDERAL EMERGENCY OFFICE OF PERSONNEL

DEVELOPMENT MANAGEMENT AGENCY MANAGEMENT

800-230-6539 or 703-875-4999

DEPARTMENT OF AGRICULTURE GENERAL SERVICES

800-424-9121 or 202-690-1622

(TDD) 202-690-1202

DEPARTMENT OF COMMERCE DEPARTMENT OF HEALTH & HUMAN

800-424-5197 or 202-482-2495

(TDD) 202-854-8407

CORPORATION FOR NATIONAL DEPARTMENT OF HOUSING &

SERVICE URBAN DEVELOPMENT SMALL BUSINESS ADMINISTRATION

800-452-8210

DEPARTMENT OF DEFENSE DEPARTMENT OF THE INTERIOR SOCIAL SECURITY ADMINISTRATION

800-424-9098 or 703-604-8456

DEPARTMENT OF EDUCATION DEPARTMENT OF JUSTICE

800-647-8733 or 202-205-5770

DEPARTMENT OF ENERGY DEPARTMENT OF LABOR AGENCY

800-541-1625 or 202-586-4073

ENVIRONMENTAL PROTECTION NATIONAL AERONAUTICS & SPACE

AGENCY ADMINISTRATION

202-260-4977

FEDERAL DEPOSIT INSURANCE NUCLEAR REGULATORY

CORPORATION COMMISSION

800-964-FDIC or 800-964-3342

800-323-8603

ADMINISTRATION OFFICE OF SPECIAL COUNSEL

800-424-5210 or 202-501-1780

SERVICES

800-HHS-TIPS

800-347-3735 or 202-708-4200

800-424-5081 or 703-235-9399

800-869-4499

800-347-3756 or 202-219-5227

800-424-9183

800-233-3497

202-606-2423 (fraud, waste & abuse) or

202-418-3300 (health care fraud)

800-872-9855 (disclosure hotline) or

800-572-2249 (whistleblower protection) or

800-85-HATCH (Hatch Act information)

RAILROAD RETIREMENT BOARD

800-772-4258

800-767-0385 or 202-205-7151

800-269-0271 (employee-related)

800-772-1213 ((SSA program-related)

DEPARTMENT OF STATE

ARMS CONTROL AND DISARMAMENT

UNITED STATES INFORMATION

AGENCY

202-647-3320 (collect calls accepted)

DEPARTMENT OF TRANSPORTATION

800-424-9071 or 202-366-1461

DEPARTMENT OF THE TREASURY

800-359-3898

DEPARTMENT OF VETERANS AFFAIRS

800-488-8244 or 202-565-8644
— 19 —

The Executive Council

on Integrity and Efficiency

The Executive Council on Integrity and Efficiency (ECIE), comprised primarily of the agency head appointed

IGs, was created by Presidential executive order on May 11, 1992. The ECIE has the same mission as the

PCIE: to address integrity, economy and effectiveness issues that transcend individual government

agencies; and to increase the professionalism and effectiveness of IG personnel throughout the government.

The ECIE is also chaired by the Deputy Director for Management of the Office of Management and Budget.

In addition to the agency-head appointed IGs, members include the Controller of the Office of Federal

Financial Management, the Special Counsel of the Office of Special Counsel, the Director of the Office of

Government Ethics, the Deputy Director of the Office of Personnel Management, and a representative of the

Director of the Federal Bureau of Investigation.

The following report summarizes the statistical accomplishments of the ECIE IGs for Fiscal Year 1996.

AUDITS AND INSPECTIONS

The tables on the following pages demonstrate the impact of OIG audits and inspections. The tables summarize key

statistical accomplishments reported in the individual IG semiannual reports to the Congress for the 6-month periods

ending March 31 and Sep tember 30, 1996. The statistical accomplishments relate to recommendations that funds be

put to better use; management decisions on recommendations that funds be put to better use; questioned costs; an d

management decisions on questioned costs.

RECOMMENDATIONS THAT FUNDS

BE PUT TO BETTER USE

The IG Act defines a recommendation that funds b e

put to better use as “a recommendation by the Offic e

that funds could be used more efficiently if manage -

ment of an establishment took actions to implemen t

and complete the recommendation, including (A) reductions in outlays; (B) deobligations of funds from

programs or operations; (C) withdrawal of interest

subsidy costs on loans or loan guarantees, insurance, or

bonds; (D) costs not incurred by implementin g

recommended improvements related to the operations

of the establishment, a contractor, or grantee; (E )

avoidance of unnecessary expenditures noted in pre -

award reviews of contract or grant agreements; or (F)

any other savings which are specifically identified.”

During FY 1996, ECIE member audits recommended

that about $136 million be put to better use (Table I).
Table I.

RECOMMENDATIONS THAT FUNDS BE PUT TO BETTER USE

FY 1996

Entity Total Entity Total

Appalachian Regional Commission (ARC) $ 2,611,000 Legal Services Corporation (LSC) —

Commodity Futures Trading Commission (CFTC) — National Archives and Records Adm. (NARA) 89,000

Consumer Product Safety Commission (CPSC) — National Credit Union Administration (NCUA) —

Corporation for Public Broadcasting (CPB) 139,000 National Endowment for the Arts (NEA) —

Equal Employment Oppty. Commission (EEOC) — Nat. Endowment for the Humanities (NEH) 16,000

Farm Credit Administration (FCA) 53,400 National Labor Relations Board (NLRB) —

Federal Communications Commission (FCC) 1,780,646 Nat. Railroad Passenger Corporation (NRPC) —

Federal Election Commission (FEC) — National Science Foundation (NSF) 41,603,481

Federal Housing Finance Board (FHFB) — Panama Canal Commission (PCC) —

Federal Labor Relations Authority (FLRA) 12,850 Peace Corps (PC) —

Federal Maritime Commission (FMC) — Pension Benefit Guaranty Corporation (PBGC) —

Federal Reserve Board (FRB) — Securities and Exchange Commission (SEC) —

Federal Trade Commission (FTC) — Smithsonian Institution (SI) —

Government Printing Office (GPO) — Tennessee Valley Authority (TVA) 39,184,524

International Trade Commission (ITC) — U.S. Postal Service (USPS) 50,450,426

TOTAL $ 135,940,327

Table II (page 21) reports on the status of FY 1996 management decisions on OIG audit recommendations that funds be put to better use. Entity managers agreed

with $87 million in recommendations that funds be put to better use.
— 21 —

Table II.

MANAGEMENT DECISIONS ON RECOMMENDATIONS

THAT FUNDS BE PUT TO BETTER USE

FY 1996

Entity Start FY 1996 FY 1996 to by Mgmt. to by Mgmt. End FY 1996

No Mgmt. Dec. Recs. Issued in Recs. Agreed Recs. Not Agreed No Mgmt. Dec.

ARC $ 28,000 $ 2,611,000 $ 2,639,000 — —

CFTC — — — — —

CPSC — — — — —

CPB — 139,000 139,000 — —

EEOC — — — — —

FCA — 53,400 — — 53,400

FCC — 1,780,646 — — 1,780,646

FEC — — — — —

FHFB — — — — —

FLRA — 12,850 12,850 — —

FMC — — — — —

FRB — — — — —

FTC — — — — —

GPO 4,796,898 — 177,000 — 4,619,898

ITC — — — — —

LSC — — — — —

NARA — 89,000 89,000 — —

NCUA — — — — —

NEA — — — — —

NEH — 16,000 16,000 — —

NLRB — — — — —

NRPC — — — — —

NSF 9,925,000 41,603,481 9,669,381 4,474,000 37,385,100

PCC 77,000 — — 77,000 —

PC — — — — —

PBGC — — — — —

SEC — — — — —

SI 276,000 — — — 276,000

TVA 3,875,754 39,184,524 35,475,398 1,772,371 5,722,509

USPS 106,258,257 50,450,426 38,943,559 27,436,034 90,329,090

TOTALS $ 125,236,909 $ 135,940,327 $ 87,161,188 $ 33,759,405 $ 140,166,643
— 22 —

QUESTIONED COSTS

The IG Act defines a questioned cost as "a cost

that is questioned by the Office because of (A)

an alleged violation or provision of law,

regulation, contract, grant, or cooperative

agreement, or other agreement or document

governing the expenditure of funds; (B) a

finding that, at the time of the audit, such cost is

not supported by adequate documentation; or

(C) a finding that the expendit ure of funds for the

intended purpose is unnecessary or unreasonable."

Table III (below) and Table IV (page 23) present, respectively, the total costs questioned by OIGs in FY 1996

and the total amount of management decisions to disallow costs questioned by OIGs. During FY 1996, OIG

audits resulted in approximately $292 million in questioned costs.

Table III.

QUESTIONED COSTS

FY 1996

Entity Total Entity Total

ARC $ 160,000 LSC 6,557

CFTC — NARA 272,000,000

CPSC — NCUA 586

CPB — NEA 531,953

EEOC 62,000 NEH 228,004

FCA — NLRB —

FCC 297,041 NRPC 5,556,849

FEC — NSF 4,993,767

FHFB 1,553 PCC 730,877

FLRA 20,960 PC 57,403

FMC — PBGC 410,139

FRB — SEC —

FTC — SI —

GPO 302,663 TVA 5,155,076

ITC — USPS 1,862,593

TOTAL $ 292,378,021

Table IV reports on the status of FY 1996 management decisions to disallow costs questioned by OIGs. Entity managers

agreed with almost $1.6 billion in questioned costs.
— 23 —

Table IV.

MANAGEMENT DECISIONS ON AUDITS

WITH QUESTIONED COSTS

FY 1996

Entity

No Mgt. Dec. tions Issued in Agreed to by Not Agreed to by No Mgt. Dec.

Start FY 1996 FY 1996 Management Mgt. End FY 1996

Recommenda- Disallowances Disallowances

ARC $ 48,000 $ 160,000 $ 21,000 $ 34,000 $ 153,000

CFTC — — — — —

CPSC — — — — —

CPB — — — — —

EEOC — 62,000 — 62,000 —

FCA — — — — —

FCC — 297,041 — 297,041 —

FEC — — — — —

FHFB 810 1,553 1,986 377 —

FLRA — 20,960 20,960 — —

FMC — — — — —

FRB — — — — —

FTC — — — — —

GPO 289,116 302,663 208,923 48,453 334,403

ITC — — — — —

LSC — 6,557 6,557 — —

NARA — 272,000,000 272,000,000 — —

NCUA — 586 586 — —

NEA 32,959 531,953 47,932 — 516,980

NEH 228,817 228,004 382,321 — 74,500

NLRB — — — — —

NRPC 20,670,086 5,556,849 9,063,958 16,398,381 764,596

NSF 6,158,529 4,993,767 949,795 756,336 4,914,076

PCC 3,977,078 730,877 550,042 4,012,425 145,488

PC 78,686 57,403 12,502 — 123,587

PBGC — 410,139 410,139 — —

SEC 436 — 38 398 —

SI — — — — —

TVA 2,330,876 5,155,076 3,163,594 4,038,295 284,063

USPS 1,346,419,418 1,862,593 1,289,976,939 50,777,491 7,527,581

TOTAL $ 1,380,234,811 $ 292,378,021 $ 1,576,817,272 $ 76,425,197 $ 14,838,274
— 24 —

INVESTIGATIONS

The following tables illustrate the results obtained through OIG investigations during FY 1996. The y

summarize the statistical accomplishments reported by the individual IGs in their semiannual reports to the

Congress as of March 31 and September 30, 1996. The accompl ishments— successful criminal prosecutions,

administrative sanctions and investigative recoveries— include the results of joint investigations.

Table V.

SUCCESSFUL CRIMINAL PROSECUTIONS

FY 1996

Entity Total Entity Total

ARC — LSC 1

CFTC — NARA —

CPSC — NCUA —

CPB — NEA —

EEOC 1 NEH —

FCA — NLRB 1

FCC — NRPC 5

FEC — NSF 2

FHFB — PCC 1

FLRA — PC 1

FMC — PBGC —

FRB — SEC —

FTC 1 SI 2

GPO 2 TVA 24

ITC — USPS 9,095

TOTAL 9,136
— 25 —

Table VI.

PERSONNEL ACTIONS

FY 1996

Entity Total Entity Total

ARC — LSC —

CFTC — NARA 5

CPSC 2 NCUA 1

CPB — NEA —

EEOC 1 NEH —

FCA — NLRB 1

FCC — NRPC 9

FEC — NSF 16

FHFB 1 PCC 9

FLRA — PC 4

FMC — PBGC 5

FRB — SEC 8

FTC 1 SI 4

GPO 13 TVA 52

ITC 2 USPS —

TOTAL 134

Table VII.

SUSPENSIONS/DEBARMENTS

FY 1996

Entity Total

GPO 23

PCC 1

TOTAL 24
— 26 —

Table VIII.

INVESTIGATIVE RECOVERIES

FY 1996

Entity Total Entity Total

ARC $ — LSC $ 21,122

CFTC — NARA 317

CPSC — NCUA —

CPB — NEA —

EEOC — NEH —

FCA — NLRB —

FCC 1,003 NRPC 594,000

FEC — NSF 6,576,984

FHFB 1,635 PCC 458

FLRA — PC 55,139

FMC — PBGC 5,651

FRB — SEC —

FTC 6,400 SI 25,579

GPO 253,558 TVA 3,313,133

ITC 2,244 USPS 100,360,919

TOTAL $ 111,218,142
— 27 —

MEMBERSHIP OF THE EXECUTIVE COUNCIL ON INTEGRITY AND EFFICIENCY

John A. Koskinen, Chair, ECIE

Deputy Director for Management FEDERAL HOUSING FINANCE BOARD

OFFICE OF MANAGEMENT AND BUDGET 777 F Street, NW, 1st Floor Stephen D. Potts, Director

Old Executive Office Building Washington, D.C. 20006 OFFICE OF GOVERNMENT ETHICS

Washington, D.C. 20503 1201 New York Ave., NW, Suite 500

Thomas D. Blair, Vice Chair, ECIE FEDERAL LABOR RELATIONS AUTHORITY

Inspector General, SMITHSONIAN INSTITUTION 607 14th Street, NW, 2nd Floor G. Edward DeSeve, Controller

955 L’Enfant Plaza, Room 7600 Washington, D.C. 20424-0001 OFFICE OF MANAGEMENT AND BUDGET

Mail Stop 905 17th Street & Pennsylvania Ave., NW

Washington, D.C. 20560 Room 260

June Gibbs Brown, Vice Chair, PCIE 800 North Capitol Street, Room 1072

Inspector General, DEPARTMENT OF HEALTH AND Washington, D.C. 20573 Kathleen Day Koch, Special Counsel

HUMAN SERVICES OFFICE OF SPECIAL COUNSEL

330 Independence Ave. SW Rm. 5250 1730 M Street, NW, Suite 300

Washington, DC 20201 Washington, D.C. 20036-4505

Fred E. Weiderhold, Jr. Washington, DC 20551 William C. Forbes, Inspector General

Inspector General, AMTRAK

Department of Internal Affairs

400 North Capital Street, NW

Washington, DC 20001

Hubert N. Sparks, Inspector General

APPALACHIAN REGIONAL COMMISSION

1666 Connecticut Ave., NW, Room 215

Washington, DC 20235

A. Roy Lavik, Inspector General

COMMODITY FUTURES TRADING COMMISSION

Three Lafayette Centre

1155 21st Street, NW, Suite 4092

Washington, DC 20581

Thomas F. Stein, Inspector General

CONSUMER PRODUCT SAFETY COMMISSION

4330 East West Highway

Bethesda, MD 20814-4408

Michael Donovan, Acting Inspector General

CORPORATION FOR PUBLIC BROADCASTING

901 E Street, NW

Washington, DC 20004-2006

Aletha L. Brown, Inspector General UNITED STATES POSTAL SERVICE

EQUAL EMPLOYMENT OPPORTUNITY COMMISSION 475 L’Enfant Plaza, SW

1801 L Street, NW, Suite 3001 Washington, D.C. 20260-2100

Washington, DC 20507

Eldon W. Stoehr, Inspector General

FARM CREDIT ADMINISTRATION

1501 Farm Credit Drive, Suite 4100

McLean, VA 22102-5090

Robert Bryant, Assistant Director

Criminal Investigative Division

FEDERAL BUREAU OF INVESTIGATION

9th Street & Pennsylvania Ave., NW

Washington, DC 20535

H. Walker Feaster III, Inspector General

FEDERAL COMMUNICATIONS COMMISSION

1919 M Street, NW, Suite 752

Washington, DC 20554

Lynne A. McFarland, Inspector General

FEDERAL ELECTION COMMISSION

999 E Street, NW, Room 940

Washington, D.C. 20463

Edward Kelley, Inspector General

Robert G. Andary, Inspector General

Tony P. Kominoth, Inspector General

FEDERAL MARITIME COMMISSION

Brent L. Bowen, Inspector General

FEDERAL RESERVE SYSTEM

2oth Street & Constitution Ave., NW

Frederick J. Zirkel, Inspector General

FEDERAL TRADE COMMISSION

6th Street & Pennsylvania Ave., NW

Washington, D.C. 2058 Charles C. Maddox, Inspector General

Thomas Muldoon, Acting Inspector General

GOVERNMENT PRINTING OFFICE

North Capitol & H Streets, NW (Stop: IG)

Washington, D.C. 20401 Wayne Robert Poll, Inspector General

Jane E. Altenhofen, Inspector General

INTERNATIONAL TRADE COMMISSION

500 E Street, SW, Room 220

Washington, D.C. 20436 Walter Stachnik, Inspector General

Edouard R. Quatrevaux, Inspector General

LEGAL SERVICES CORPORATION

750 First St, NE 10th Floor

Washington, DC 20002-4250 George T. Prosser, Inspector General

Kelly A. Sisario, Inspector General

NATIONAL ARCHIVES AND RECORDS

ADMINISTRATION

8601 Adelphi Road, Room 1300 Karla Wolfe Corcoran

College Park, MD 20740-6000

H. Frank Thomas, Inspector General

NATIONAL CREDIT UNION ADMINISTRATION

1775 Duke Street

Alexandria, VA 22314-3428

Edward Johns, Inspector General

NATIONAL ENDOWMENT FOR THE ARTS

1100 Pennsylvania Ave., NW, Rm. 207

Washington, D.C. 20506

Sheldon L. Bernstein, Inspector General

NATIONAL ENDOWMENT FOR THE HUMANITIES

1100 Pennsylvania Ave., NW, Rm. 801

Washington, D.C. 20506

Robert E. Allen, Acting

 Inspector General

NATIONAL LABOR RELATIONS BOARD

1099 14th Street, NW, Room 9820

Washington, D.C. 20570

Linda G. Sundro, Inspector General

NATIONAL SCIENCE FOUNDATION

4201 Wilson Boulevard

Arlington, VA 22230

Washington, D.C. 20005-3917

Washington, DC 20503

PANAMA CANAL COMMISSION

Section 230

APO AA 34011

PEACE CORPS

1900 K Street, NW, Suite 5302

Washington, D.C. 20526

PENSION BENEFIT GUARANTY CORPORATION

1200 K Street, NW, Suite 470

Washington, D.C. 20005-4026

SECURITIES AND EXCHANGE COMMISSION

450 - 5th Street, NW, Room 7010

Washington, D.C. 20549

TENNESSEE VALLEY AUTHORITY

400 W. Summit Hill Dr., Rm. ET 4H

Knoxville, TN 37902-1499

Inspector General

Note: The members listed are those in service as of

January 1997.
— 28 —

INSPECTOR GENERAL HOTLINE NUMBERS

- ECIE Members -

SMITHSONIAN INSTITUTION FEDERAL ELECTION COMMISSION NATIONAL ENDOWMENT FOR THE

202-287-3676

AMTRAK FEDERAL HOUSING FINANCE BOARD

202-906-4600

APPALACHIAN REGIONAL COMM. FEDERAL LABOR RELATIONS AUTH.

800-532-4611 or 202-884-7667

COMMODITY FUTURES TRADING FEDERAL MARITIME COMMISSION

COMMISSION

202-418-5510

CONSUMER PRODUCT SAFETY

COMMISSION PANAMA CANAL COMMISSION

301-504-0573

CORPORATION FOR PUBLIC PEACE CORPS

BROADCASTING

202-783-5408

EQUAL EMPLOYMENT OPPORTUNITY CORPORATION

COMMISSION

800-849-4230

FARM CREDIT ADMINISTRATION COMMISSION

800-437-7322 or 703-883-4316

FEDERAL COMMUNICATIONS COMM. TENNESSEE VALLEY AUTHORITY

202-418-0473

202-219-4267

202-408-2544

800-331-3572

202-523-5865

FEDERAL RESERVE BOARD

800-827-3340 or 202-452-6400

FEDERAL TRADE COMMISSION

202-326-2800

GOVERNMENT PRINTING OFFICE

800-743-7574

LEGAL SERVICES CORPORATION

800-743-7574

NATIONAL ARCHIVES AND RECORDS

ADMINISTRATION

800-786-2551 or 301-713-7305

NATIONAL CREDIT UNION

ADMINISTRATION

703-518-6357 or 800-778-4806

ARTS

202-682-5402

NATIONAL ENDOWMENT FOR THE

HUMANITIES

202-606-8423

NATIONAL LABOR RELATIONS BOARD

800-736-2983

NATIONAL SCIENCE FOUNDATION

703-306-2004

800-622-2625, ext. 272-7801

800-233-5874

PENSION BENEFIT GUARANTY

202-778-8855

SECURITIES AND EXCHANGE

202-942-4460

800-323-3835

UNITED STATES POSTAL SERVICE

800-654-8896
— 29 —

GLOSSARY OF ACRONYMS

AND ABBREVIATIONS

AID Agency for International Development

ARC Appalachian Regional Commission

BIB Board for International Broadcasting

CFO chief financial officer

CFTC Commodity Futures Trading Commission

CNCS Corporation for National Service

CPB Corporation for Public Broadcasting

CPSC Consumer Product Safety Commission

DCAA Defense Contract Audit Agency

DOD Department of Defense

DOE Department of Energy

DOI Department of the Interior

DOJ Department of Justice

DOL Department of Labor

DOT Department of Transportation

ECIE Executive Council on Integrity and Efficiency

ED Department of Education

EEOC Equal Employment Opportunity Commission

EPA Environmental Protection Agency

FBI Federal Bureau of Investigation

FCA Farm Credit Administration

FCC Federal Communications Commission

FEC Federal Election Commission

FDIC Federal Deposit Insurance Corporation

FEMA Federal Emergency Management Agency

FHFB Federal Housing Finance Board

FLRA Federal Labor Relations Authority

FMC Federal Maritime Commission

FRB Federal Reserve Board

FTC Federal Trade Commission

FY fiscal year

GPO Government Printing Office

GSA General Services Administration

HHS Department of Health and Human Services

HUD Department of Housing and Urban Development

IG Inspector General

IG Act Inspector General Act of 1978 (as amended)

ITC International Trade Commission

LSC Legal Services Corporation

NARA National Archives and Records Administration

NASA National Aeronautics and Space Administration

NCUA National Credit Union Administration

NEA National Endowment for the Arts

NEH National Endowment for the Humanities

NLRB National Labor Relations Board

NPR National Performance Review

NRC Nuclear Regulatory Commission

NSF National Science Foundation

OIG Office of Inspector General
— 30 —

GLOSSARY OF ACRONYMS

AND ABBREVIATIONS

(continued)

OMB Office of Management and Budget

OPM Office of Personnel Management

PAS Presidentially appointed/Senate confirmed

PBGC Pension Benefit Guaranty Corporation

PC Peace Corps

PCC Panama Canal Commission

PCIE President's Council on Integrity and Efficiency

PS United States Postal Service

RRB Railroad Retirement Board

SBA Small Business Administration

SEC Securities and Exchange Commission

SI Smithsonian Institution

TVA Tennessee Valley Authority

USDA Department of Agriculture

VA Department of Veterans Affairs