Table of Contents 

Message from the Inspector General ........................................................................................................... 1 

Background ................................................................................................................................................... 2 

Strategic Goals .............................................................................................................................................. 4 

New Strategic Plan ........................................................................................................................................ 7 

Audits, Inspections, and Evaluations ............................................................................................................ 8 

REPORTS ISSUED ....................................................................................................................................... 8 

IN PROCESS ............................................................................................................................................. 11 

STATUS OF AGREED‐UPON ACTIONS AND RECOMMENDATIONS .......................................................... 12 

OPEN AGREED‐UPON ACTIONS ............................................................................................................... 13 

Other Reports ............................................................................................................................................. 15 

Quarterly Survey of Farm Credit System Institutions ............................................................................. 15 

Investigations .............................................................................................................................................. 16 

Legislative and Regulatory Reviews ............................................................................................................ 17 

Reporting and Outreach ............................................................................................................................. 19 

OIG Staff ...................................................................................................................................................... 20 

Annex .......................................................................................................................................................... 21 

Appendix A .................................................................................................................................................. 22 

Appendix B .................................................................................................................................................. 23 

Appendix C .................................................................................................................................................. 24 

Appendix D .................................................................................................................................................. 25 

Appendix E .................................................................................................................................................. 26 

Appendix F .................................................................................................................................................. 27 

Appendix G .................................................................................................................................................. 28 

Appendix H .................................................................................................................................................. 29 

Appendix I ................................................................................................................................................... 30 

1 

 Message from the Inspector General 

As the newly appointed Inspector General (IG), I am pleased to submit this Semiannual Report to 

the Congress. This report summarizes the activities and accomplishments of the Farm Credit 

Administration’s (FCA’s or Agency’s) Office of Inspector General (OIG) for the period from April 1, 

2017 through September 30, 2017.  

For most of this reporting period, the OIG was ably led by the Agency’s former IG, Elizabeth (Liz) 

Dean, who had been part of the OIG at FCA since its creation in 1989. Liz first served as counsel to 

the FCA IG, then as deputy, and finally as IG where she helped shape and carry out the OIG’s 

mission “to be an agent of positive change.” Liz not only had a positive impact on our office, but 

she also made significant contributions to the larger IG community, serving as the at‐large 

member to the Council of Inspectors General on Integrity and Efficiency (CIGIE) Executive Council, 

as a member of the CIGIE Committees on Legislation and Inspection and Evaluation, and as chair 

of the Small Agency working group. I thank Liz for her exceptional career and service to FCA and 

the IG community.  

During this reporting period, the OIG focused on Agency spending, security, and quality 

assurance by completing an audit of FCA’s contracting activities, the first of five planned 

inspections on physical security in our Denver field office, and an internal review of all our office 

policies and procedures. As an additional internal control measure, and for the first time, the OIG 

employed an outside contractor to perform the annual evaluation of the Agency’s compliance 

with the Federal Information Security Modernization Act (FISMA) rather than using our own 

auditors. 

With my arrival, we looked ahead to developing new mission and vision statements, and new 

values, goals, and action items. We developed the strategic and auditing plans, as well as our 

budget, for FYs 2018‐2019. 

I thank the exceptional OIG staff for their dedication to providing timely, accurate, objective, 

and impactful products. I also thank FCA management for their continued cooperation and 

engagement with our office. Finally, I look forward to creating strong  

working relationships with the larger IG community, which has already  

been a welcoming and invaluable resource, and to creating strong  

reporting relationships with our congressional oversight committees. 

Wendy R. Laguarda 

Inspector General
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

2 

 Background 

FARM CREDIT ADMINISTRATION

The Farm Credit Administration (FCA or Agency) is an independent federal agency of the United States 

government responsible for the regulation and examination of Farm Credit System (FCS or System) institutions 

chartered under the Farm Credit Act of 1971, as amended (Farm Credit Act).   

As a non‐appropriated agency, FCA funds its expenses primarily by assessing the FCS institutions. For fiscal 

year (FY) 2017, FCA’s operating budget was $68,600,000.   

At the end of the prior semiannual reporting period, the Agency had 310 employees. As of the end of 

this reporting period, FCA has 299 employees, about half of whom are examiners located in the Agency’s 

five field offices as shown below. 

Headquarters McLean, VA 

Bloomington, MN 

Sacramento, CA Denver, CO 

Dallas, TX 

FARM CREDIT SYSTEM 

The System is a government‐sponsored enterprise comprised of 3 Farm Credit Banks, 1 Agricultural Credit 

Bank, and 69 associations that primarily makes loans to agriculture in all 50 states and Puerto Rico. The System 

raises funds by selling securities in the national and international money markets through its special purpose 

entity, the Federal Farm Credit Banks Funding Corporation. These securities are not guaranteed by the U.S. 

government.  

The Federal Agricultural Mortgage Corporation (Farmer Mac), also a part of the System, is chartered by the 

federal government to provide a secondary market for agricultural mortgage loans. Farmer Mac is publicly 

traded and issues its own debt securities. Additionally, there are five active service corporations that 

provide services to FCS entities and eligible borrowers. 
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

3 

 Background 

OFFICE OF INSPECTOR GENERAL 

The mission of the Office of Inspector General (OIG) is as follows: 

The OIG’s independent eyes, ears, and voice 

serve to protect, inform, and advance Agency 

programs and operations.

The Inspector General Act of 1978, as amended, established the FCA OIG in 1989. The Inspector General is 

appointed by the FCA Board without regard to political affiliation and solely based on integrity and 

demonstrated ability in accounting, auditing, financial analysis, management analysis, investigations, 

law, or public administration. 

While the OIG is under the general supervision of the FCA Board, it operates with independent personnel, 

contracting, and budget authority. The Inspector General reports both to the FCA Board and to Congress.   

The three major components for this reporting period included audits, inspections, and evaluations of 

programs and operations; investigations; and outreach.  

Office of Inspector General

Audits, 

Inspections, and 

Evaluations

Investigations Outreach 
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

4 

   

 Strategic Goals 

To accomplish our mission, the OIG has three strategic goals in place that are aligned to FCA’s mission, 

programs, and activities (see the OIG’s Strategic and Operating Performance Plan for additional information). 

The following summarizes our strategic goals and related outcomes during this reporting period. As of October 

1, 2017, we have implemented a new strategic plan outlined on page 7. 

Strategic Goal 1: 

Audit, inspect, and evaluate the Agency’s programs and operations 

to assist the Agency in fulfilling its oversight mission more efficiently 

and effectively.    

During this reporting period, we issued one audit report and one inspection report, with 

four reviews still in process. Based on our work, OIG made 12 recommendations and 

Agency management agreed with all the recommendations. The in‐process reviews 

include our contracted work with Harper, Rains, Knight & Company, P.A. (to perform the 

audit of FCA’s financial statements for FY 2017), and with Brown & Company (to perform 

the evaluation of FCA’s compliance with the FISMA). 

Communication with Agency stakeholders is another key aspect of the OIG’s oversight. 

During our reviews, we continually meet with Agency officials to keep them informed of 

results and areas for improvements. The Inspector General also regularly meets with FCA 

Board members to discuss work products and Agency priorities. 

The OIG is continuously working to ensure compliance with standards, improve internal 

processes, and advance professional competencies. During this period, we performed an 

internal quality assurance review of our audit, inspection, and evaluation functions. This 

review did not identify any significant weaknesses. We continue to prioritize staff training 

to meet requirements for professional education and gain new skills. 
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

5 

   

   

 Strategic Goals

Strategic Goal 2: 

Investigate alleged wrongdoing to prevent and detect fraud, abuse, 

and mismanagement in Agency programs and operations and to 

address congressional, public, and employee concerns.   

The deputy and counsel to the IG is also the investigator for the office. During this 

reporting period, the OIG opened one investigation and closed four, including the one 

opened during the reporting period. As of the end of the reporting period, the OIG had 

no pending investigations. We also received 15 complaints via the OIG Hotline during this 

reporting period. 

The OIG Hotline is available 24/7 to receive tips and complaints about fraud, waste, or abuse 

relating to FCA programs and operations. The Hotline enables individuals to report their 

allegations to the OIG directly and confidentially and is available through email, phone, fax, and 

mail. OIG evaluates all Hotline complaints on multiple levels, examining jurisdictional issues, the 

nature of the allegation, and other factors. The OIG also assesses availability of records, 

credibility, and other factors to determine whether the complaint includes allegations of 

criminal, civil, or administrative violations that necessitate formal investigation. OIG refers all 

borrower complaints to the FCA Office of Congressional and Public Affairs, as required by FCA 

policy and procedure, and follows up as appropriate. 

The OIG participates in the Agency’s training of new employees to inform employees about the 

role of the OIG, the OIG’s Hotline, and the responsibility to report fraud, waste, and abuse 

relating to Agency programs and operations. The OIG distributes posters identifying Hotline and 

contact information, as well as Office of Special Counsel notifications, and continues to develop 

its Fraud Awareness Program to provide training and guidance to FCA employees on reporting 

responsibilities, fraud indicators, methods of reporting, and whistleblower protections. The OIG 

follows the CIGIE Quality Standards for Investigations as guidance for all its investigative activity. 
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

6 

 Strategic Goals 

Strategic Goal 3: 

   

Review and make recommendations regarding existing and proposed

legislation and regulations and provide other outreach to support the 

Agency’s oversight mission and the Inspector General community on 

government‐wide issues.

During this reporting period, we reviewed 26 items, including 19 legislative initiatives, 1 

proposed rule, 1 agency policy, and 5 informational memoranda. We addressed various 

issues, including the following:  

 Reporting security incidents and business continuity events to FCA 

 Office of Special Counsel access to records 

 Use of analytics in government purchase and travel card investigations 

 Enhanced whistleblower protections for federal employees 

 Restrictions on access to medical records of federal employees 

 Prohibitions against awards for employees subject to misconduct determination 

Almost all OIG products are posted on our public website to ensure timely and effective 

communication, and transparency. The IG and OIG staff continued to participate in the IG 

community by participating and holding numerous positions in CIGIE committees and 

workgroups.  
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

7 

 New Strategic Plan 

Beginning October 1, 2017, the OIG implemented a new strategic plan with a revised mission, vision, values, 

goals, and actions. 

Our Mission 

The OIG’s independent eyes, ears, and voice serve to protect, inform, and 

advance Agency programs and operations. 

Our Vision 

Harvesting Change 

Our Values 

Relevant, Respectful, Trustworthy, and Objective 

Our Goals 

1.  Detect and Deter Fraud, Waste, and Abuse 

2.  Investigate and Protect Against Wrongdoing 

3.  Promote Quality and Value 

4.  Advance FCA’s Future 

GOAL 1

Perform risk‐based    

audits, inspections,      

and evaluations

Reinforce the OIG as a    

safe zone for reporting 

fraud, waste, and abuse

Listen to and   

understand the needs, 

challenges, and    

interests of our 

stakeholders

GOAL 2

Guard confidentiality

Produce timely, clear, 

focused, and factual  

reports of investigation

Provide outreach on  

how to prevent fraud, 

waste, and abuse 

GOAL 3

Create benchmarks       

for improved Agency     

decision making

Ensure the OIG and     

FCA are models for    

good government

Produce OIG products    

that are timely,   

relevant, reasonable,  

and helpful

GOAL 4

Recruit, retain, and 

empower a diverse 

workforce

Promote leadership,   

vision, and expertise

Leverage technology
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

8 

 Audits, Inspections, and Evaluations 

REPORTS ISSUED 

This reporting period, the OIG continued to provide FCA with high‐quality products. We issued one audit 

report and one inspection report, with a total of 12 agreed‐upon actions with FCA management. We also have 

four reviews in progress. Additionally, the OIG issued 24 surveys to FCS institutions and two reports on the 

survey results to the Chief Examiner and FCA Board. The reports summarize survey results and stakeholder 

opinions on the quality and issues involved in the examination function.  

2

Audit, 

Inspection & 

Evaluation 

Reports

12

Agreed-Upon 

Actions 

Initiated

4

In-Process

Surveys 

Issued to 

FCS 

Institutions

24 2

Survey 

Reports

The OIG conducts all audits in accordance with Government Auditing Standards issued by the Comptroller 

General of the United States for audits of federal organizations, programs, activities, and functions. We 

conduct inspections and evaluations in accordance with the CIGIE Quality Standards for Inspection and 

Evaluation.  

Copies of most OIG reports are available on our website at www.fca.gov/home/inspector.html, by contacting 

the OIG at (703) 883‐4030, or by email at ig_information@fca.gov. We offer a free subscription service that 

provides automatic notification by email when a new report or other information is posted to the OIG website. 

Go to http://apps.fca.gov/subscribeOIG/, provide your email, and click to join the list. Finally, we are also 

posting all our public reports and information on the newly‐launched IG website known as Oversight.gov. 
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

9 

 Audits, Inspections, and Evaluations 

FCA’s Contracting Activities  

To fulfill its mission requirements, the Agency executes and administers contracts to meet its needs. As 

a non‐appropriated Agency, FCA is not subject to the Office of Federal Procurement Policy Act or the 

Federal Acquisition Regulation. The objective of this audit was to determine whether FCA’s contracting 

process is effectively administered. We found the process is effectively administered, but needs some 

improvements. 

Our review identified examples where the Agency had not followed contracting procedures. Other 

contracts in our sample included errors in contract documentation or unspecified payment terms. We 

noted contract clauses that were outdated, incomplete or missing. There was an inconsistent approach 

to how the contractor onboarding process was initiated, documented, and updated. We also noted 

various examples in our sample of missing documentation from the official contract files. The Agency 

needed to revise aspects of the contracting process, including conflict of interest declarations and 

accessibility and legal reviews.  

To improve contract administration, the Office of Agency Services (OAS) agreed to: 

1. Develop a plan with milestones to ensure contract file documentation is complete. Where 

feasible, OAS will include automation options. 

2. Provide all FCA CORs with a handbook or other educational/reference materials on 

documentation requirements, invoice reviews, and overall responsibilities. 

3. Revise the contract file content checklist to include a comprehensive checklist of steps from 

solicitation to closeout in contract files. 

4. Coordinate with the Office of General Counsel to develop contract language requiring 

contractors to identify potential conflicts of interest throughout the performance of the 

contract, especially considering FCA’s regulatory mission. 

5. Revise the contractor onboarding process to ensure required forms are obtained and placed in 

the contract files. 

6. Update PPM 812, PPM 840, Office Directives, and the Contracts Desk Manual to include the 

following topics: 

a. Contract closeout, 

b. Conflict of interest statement requirements, 

c. Legal reviews, 

d. Contractor onboarding, 

e. COR appointment threshold, 

f. Section 508 compliance, 

g. Standard contract clauses, and 

h. Budget reporting process for contracts. 

7. Develop a listing of standard contract clauses for FCA procurements and implement a policy to 

ensure this repository is up to date. 

The final report, FCA’s Contracting Activities, was issued on May 22, 2017. 
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

10 

 Audits, Inspections, and Evaluations 

Physical Security Inspection – Denver Field Office 

Physical security controls safeguard FCA employees and assets. Physical security is unique in different 

locations and buildings and the strongest controls cannot eliminate security risks. However, strong 

controls and preparedness can improve overall security. For this inspection, we reviewed the Denver 

field office. Our review focused on controls related to access, computers and other equipment, 

emergency preparedness, and personnel records. 

We found controls were in place and generally effective. However, we identified opportunities to 

further improve physical security in the Denver field office. Our report included five agreed‐upon actions 

for Agency management. This report contains sensitive information about FCA and potential 

vulnerabilities. Therefore, we did not release this report publicly. 

The final report, Physical Security in the FCA’s Denver Field Office, was issued on September 29, 2017. 
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

11 

 Audits, Inspections, and Evaluations 

IN PROCESS 

Audit of FCA’s Financial Statements for FY 2017

The Accountability of Tax Dollars Act of 2002 requires FCA and certain other agencies to submit to 

Congress and Office of Management and Budget (OMB) audited financial statements each fiscal year. In 

continuing to assist the Agency in meeting these requirements, the OIG contracted with Harper, Rains, 

Knight & Company, P.A. to perform the audit of FCA’s financial statements again for FY 2017. The audit 

remained ongoing at the end of this reporting period.  

Federal Information Security Modernization Act 

The OIG contracted with Brown & Company to perform the independent evaluation of FCA’s compliance 

with FISMA for FY 2017. Key criteria used to perform this evaluation include guidelines established by 

OMB, the Department of Homeland Security, and the National Institute of Standards and Technology.  

Audit of the Office of Secondary Market Oversight 

Farmer Mac is a government‐sponsored enterprise with the mission of providing a secondary market for 

agricultural real estate mortgage loans, rural housing mortgage loans, and rural utility cooperative loans. 

Farmer Mac is regulated, examined, and supervised by FCA through the Office of Secondary Market 

Oversight (OSMO). The Farm Credit Act, as amended, includes OSMO requirements for staffing and a 

direct reporting relationship to the FCA Board. The objective of this audit is to assess the staffing 

arrangements and reporting process for OSMO. 

Inspection of FCA’s Travel Compensation and Incentives 

FCA pays travel compensation to employees who travel on official business for the Agency in the 

amount of $50 per night for every night on eligible travel, if an employee travels more than 50 nights in 

a calendar year. Compensation under the program is based on the number of eligible nights on official 

duty travel status during a calendar year. The objective of this inspection is to determine whether the 

Agency is effectively and efficiently administering the travel compensation program and other travel 

incentives. 
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

12 

 Audits, Inspections, and Evaluations 

STATUS OF AGREED‐UPON ACTIONS AND RECOMMENDATIONS

The Agency issued two reports during this reporting period with 12 agreed‐upon actions. In addition, at 

the beginning of the period, 14 carry‐over actions were still open. As of September 30, 2017, 13 agreed‐

upon actions remained open.  

Audit, Inspection, and Evaluation Agreed‐Upon Actions

Report  Issued 

Carryover 

from Prior 

6‐Month Period 

New During this 

6‐Month Period 

Final Management 

Actions During this 

6‐Month Period 

Open on 

9/30/2017 

FCA’s Commissioning 

Program  3/31/2015  1  0  1  0 

FCA’s Risk Project  3/31/2016  4  0  4  0 

FCA’s Position 

Management and Job 

Evaluation Program 

9/23/2016  1  0  0  1 

FCA’s Oversight of Young, 

Beginning, and Small 

Farmer Programs 

9/28/2016  4  0  0  4 

FCA’s Awards Program  2/23/2017  4  0  3  1 

FCA’s Contracting 

Activities  5/22/2017  0  7  5  2 

Physical Security in FCA’s 

Denver Field Office  9/29/2017  0  5  0  5 

Total  14  12  13  13 
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

13 

 Audits, Inspections, and Evaluations 

OPEN AGREED‐UPON ACTIONS 

The following charts show open agreed‐upon actions for issued reports as of September 30, 2017. 

FCA’s Position Management and Job Evaluation Program 

(Issued 9/23/16)

Agreed‐Upon 

Action Number 5  Document the promotion process at the EMT phase of the OE career ladder. 

FCA’s Oversight of Young, Beginning, and Small Farmer 

Programs (Issued 9/28/16)

ORP document policies and procedures for YBS oversight activities, including: 

Agreed‐Upon   A methodology for YBS comparison reporting that accounts for institution size 

Action Number 1  and 

 A process to address deficiencies identified through YBS reporting and analysis. 

Agreed‐Upon  ORP incorporate YBS oversight activities and processes in internal control planning and 

Action Number 2  evaluation. 

Agreed‐Upon  ORP develop a plan for addressing recommendations in the Agency’s YBS definitions 

Action Number 3  review. 

Agreed‐Upon  ORP complete an interpretation on YBS disclosure requirements in annual reports to 

Action Number 5  shareholders. 

FCA’s Awards Program (Issued 2/23/17)

Agreed‐Upon 

Action Number 2 

Modify the awards database to address the following: 

•  Multiple approvals are not completed by the same employee and approvals 

not completed by the recipient or recommender; 

•  Controls over time‐off award amounts and limits in Agency policy; and 

•  Approval routings are appropriate and reflect documented procedures.  

are 
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

14 

 Audits, Inspections, and Evaluations 

FCA’s Contracting Activities (Issued 5/22/17)

Agreed‐Upon 

Action Number 2 

Provide all FCA Contracting Officer’s Representatives (CORs) with a handbook or other 

educational/reference materials on documentation requirements, invoice reviews, 

and overall responsibilities.

Update PPM 812, PPM 840, Office Directives, and the Contracts Desk Manual, to 

include the following topics: 

a. Contract closeout, 

b. Conflict of interest statement requirements, 

Agreed‐Upon  c. Legal reviews, 

Action Number 6  d. Contractor onboarding, 

e. COR appointment threshold, 

f. Section 508 compliance, 

g. Standard contract clauses, and 

h. Budget reporting process for contracts. 

Physical Security in FCA’s Denver Field Office (Issued 9/29/17)

Agreed‐Upon  To OIT (not released publicly) Action Number 1 

Agreed‐Upon  To OE (not released publicly)  Action Number 2 

Agreed‐Upon  To OE (not released publicly)  Action Number 3 

Agreed‐Upon  To OE (not released publicly)  Action Number 4 

Agreed‐Upon  To OE (not released publicly)  Action Number 5 
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

15 

 Other Reports

Quarterly Survey of Farm Credit System Institutions

The OIG administers an ongoing survey of FCS institutions regarding the quality and consistency of the 

Agency’s examination function, including the examiners’ performance. The OIG issues a quarterly report 

and a fiscal year‐end summary report to the Chief Examiner and the FCA Board without referencing 

individual banks by name.   

The survey asks respondents to rate eight statements regarding examination activities, communications 

and FCA regulations and guidance. Additionally, respondents may comment on aspects of the 

examination that were the most and least helpful to the FCS institution’s board and management team. 

Over time analyses of response patterns enable the Agency to reach sound conclusions as to the quality 

of the examiners and the examination function. The consistent trend indicates that the System has a 

positive view of the examination program and staff. 

 Second Quarter Fiscal Year 2017 (January 1—March 31, 2017)

In May 2017, the OIG issued 13 surveys to FCS institutions for feedback on the second quarter of 

FY 2017. Eleven institutions responded. The OIG provided a report in July 2017 to the Chief 

Examiner and the FCA Board. 

 Third Quarter Fiscal Year 2017 (April 1—June 30, 2017)

In August 2017, the OIG issued 11 surveys to FCS institutions for feedback on the third quarter 

of FY 2017. Nine institutions responded. The OIG provided a report in September 2017 to the 

Chief Examiner and the FCA Board.  
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

16 

   

 Investigations 

Investigations 

closed

4

Investigations 

opened

1

Hotline 

complaints 

processed

15

Investigations 

pending

0

Investigations 

This reporting period the OIG opened one investigation and closed four, including the one that 

was opened. The closed investigations involved allegations relating to employment suitability, 

nepotism, Section 508 of the Rehabilitation Act of 1973, the Hatch Act, and damage to 

government property. The allegations were not substantiated, except for a Hatch Act violation 

and damage to government property. As of the end of the reporting period, the OIG had no 

pending investigations. 

The OIG had no reported allegations of whistleblower retaliation and the Agency cooperated in all OIG 

investigations, providing records in response to OIG investigations in a timely manner. The OIG had no 

investigations involving senior government employees in which allegations of misconduct were 

substantiated. All closed investigations were reported through summary briefings to the public. 

Hotline 

We received 15 complaints via the OIG Hotline from April through September, including one from an FCS 

borrower. All 15 complaints were referred, responded to, or closed during the reporting period, with 

one complaint pending with the Agency. OIG followed up on borrower complaints referred to the FCA 

Office of Congressional and Public Affairs and to the Office of Examination (OE) to ensure that the 

Agency finalized its responses and resolved complaints as appropriate. OIG continues to review and 

monitor its Hotline complaints for any trends or patterns of allegations that may highlight an underlying 

issue meriting closer OIG attention through an audit, inspection, evaluation, or investigation.  

The OIG completed its recertification process for the Office of Special Counsel’s 2302(c) Certification of 

Whistleblower Notifications by providing its staff with the requisite updated notices, providing training on 

prohibited personnel practices and whistleblower protections, and satisfying reporting mandates.  
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

17 

 Legislative and Regulatory Reviews

This past reporting period, OIG continued to review and provide comment and analysis on existing and 

proposed cross‐cutting legislation and regulations through our participation in various CIGIE 

committees. The OIG also continued to review proposed rules and Informational Memoranda issued by 

the Agency. During this reporting period, we reviewed: 

Legislative 

Initiatives

19

Proposed Rule

1

Informational 

Memoranda and 

Policies

6

The OIG reviewed the following list of significant legislation, proposed rules, final rules, informational 

memoranda, and policies. 

Legislation    

1. H.R. 2196, To amend Title 5, United States Code, to allow whistleblowers to disclose 

information to certain recipients 

2. H.R. 10, Financial CHOICE Act of 2017, repeals provisions of the Dodd‐Frank Wall Street Reform 

and Consumer Protection Act and other laws 

3. H.R. 244, Consolidated Appropriations Act of 2017  

4. H.R. 2131, DHS FIRM (Fixing Internal Response to Misconduct) Act of 2017  

5. H.R. 2195 OSC Access Act 

6. S. 1460, Energy and Natural Resources Act of 2017

7. S. 1099, H.R. 4047, Saving Federal Dollars Through Better Use of Government Purchase and 

Travel Cards Act of 2017 

8. S. 1253, H.R. 3522, Geospatial Data Act of 2017 

9. H.R. 657, Follow the Rules Act 

10. S. 585, Chris Kirkpatrick Whistleblower Protection Act of 2017 

11. S. 696, Stop Improper Federal Bonuses Act 

12. H.R. 2636, To Establish an Independent IG for the Federal Communications Commission 

13. H.R. 2825, DHS Authorization Act of 2017 

14. H.R. 3180, Intelligence Authorization Act for FY 2018 

15. H.R. 3470, Geolocational Privacy and Surveillance Act (H.R. 1062, The GPS Act; S. 395, The GPS 

Act) 

16. H.R. 2810, National Defense Authorization Act for FY 2018 

17. S. 582, Office of Special Counsel Reauthorization Act of 2017 

18. H.R. 3180, Intelligence Authorization Act for FY 2018 

19. H.R. 378, Bonuses for Cost‐Cutters Act of 2017 
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

18 

 Legislative and Regulatory Reviews 

Proposed Rules 

1. Statement on Regulatory Burden, Request for Comment – 12 CFR Chap. VI, 82 F.R. 22762 (May 

18, 2017) 

Informational Memoranda and Policies

1. CFPB’s Mortgage Servicing Rule Amendments and Principles for the Future of Loss Mitigation 

(April 17, 2017) 

2. Farm Credit Administration Reduces Assessment (May 26, 2017) 

3. New Capital Rule Prompts Change in Assessment Calculation (June 16, 2017) 

4. Reporting Security Incidents and Business Continuity Events to FCA (June 27, 2017) 

5. FCS Building Association Management Operations Policies and Practices (July 27, 2017) 

6. National Oversight Plan for FY 2018 (September 19, 2017)
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

19 

 Reporting and Outreach 

Congressional Reporting 

The Inspector General Empowerment Act of 2016 (IGEA) was passed in December 2016. It became 

effective in June 2017. The IGEA confirms an OIG’s access to all records available to an agency, clarifies 

existing IG authorities, and requires new reporting and posting obligations. We follow all applicable 

requirements of the IGEA. 

Outreach with the IG Community 

OIG staff members are encouraged to take part in organizations that contribute to the mission of the 

Inspectors General community and their individual professional development. The newly appointed IG is 

a member of CIGIE and serves on the CIGIE legislation committee and the Small Agency IG’s working 

group. 

The Deputy IG continued as one of two Vice Chairs to the Council of Counsels of IGs (CCIG) for the term 

from 2016 to 2018. The Deputy IG also participated in CIGIE groups, including the Strategic Planning 

Committee, Records Administrators Group, Assistant Inspectors General for Investigations, OIG FOIA 

Working Group, Deputy IGs, and the Small OIGs CCIG Working Group. 

The OIG Senior IT Auditor and Senior Auditors also participate in CIGIE workgroups. The IT Auditor 

attends local Information Systems Audit and Control Association meetings and participates on the IT 

subcommittee of the Federal Audit Executive Council. One Senior Auditor is a member of the CIGIE 

Roundtable on Inspections and Evaluations and is an adjunct instructor for CIGIE’s Training Institute. 

Reporting and Outreach at FCA 

The OIG started a new outreach initiative this reporting period by launching an internal, quarterly 

newsletter to FCA employees explaining the role of the OIG and how the OIG performs its work, 

including examples of fraud, waste, and abuse in government, and other topics. The newly appointed IG 

met with the management team in the OE to discuss the vision and priorities of the OIG. The IG also 

reports quarterly to the FCA Board and as needed.  
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

20 

   

        

 OIG Staff

Staff Development 

OIG employees continually seek ways to improve skills and become knowledgeable in the initiatives of the 

community of Inspectors General. All OIG staff must meet continuing education requirements. Development 

plans are used to identify long‐ and short‐term career goals along with specific training and developmental 

needs. These plans are geared toward enhancing individual skills in the performance of official duties, cross 

training, succession planning, and meeting the criteria needed to achieve OIG performance goals and 

objectives. 

The following organizational chart shows the OIG as of September 30, 2017: 

Inspector General

Wendy Laguarda

Deputy IG and    

Counsel to the IG   

Kathy Gallo

Senior Information 

Technology Auditor

Tammy Rapp

Senior Auditor

Sonya Cerne

Senior Auditor

Tori Kaufman

Management/   

Program Analyst                 

Ava Bell
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

21 

 Annex 

This annex is provided in accordance with the National Defense Authorization Act for FY 2008.   

This referenced statute requires all Inspectors General appointed under the IG Act to include an annex to their 

semiannual reports as follows: 

1. Listing all contract audit reports issued during the reporting period containing significant audit 

findings;  

2. Briefly describing the significant audit findings in the report; and  

3. Specifying the amounts of costs identified in the report as unsupported, questioned, or 

disallowed.   

Significant audit findings are defined as unsupported, questioned, or disallowed costs of more than 

$10,000,000, or other findings that the Inspector General determines to be significant. The statute defines 

contracts as a contract, an order placed under a task or delivery order contract, or a subcontract. 

The OIG issued no contract audit reports meeting the foregoing criteria during this reporting period. 
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

22 

 Appendix A 

Index of Reporting Requirements 

SECTION  TITLE  Page 

4(a)(2)  Review of legislation and regulations  17‐18 

5(a)(1)  Significant problems, abuses, and deficiencies  None 

5(a)(2)  Recommendations for corrective action  12 

5(a)(3)  Prior recommendations not yet implemented  13‐14 

5(a)(4)  Matters referred to prosecutive authorities  None 

5(a)(5)  Information unreasonably refused or not provided  None 

5(a)(6)  List of reports issued  23 

5(a)(7)  Summaries of significant reports  9‐10 

5(a)(8)  Management decisions with questioned costs  24 

5(a)(9)  Management decisions on recommendations that funds be put 

to better use  25 

5(a)(10)(A)  Audit reports for which no management decision made  None 

5(a)(10)(B)  Audit reports with comments not received within 60 days  None 

5(a)(10)(C)  Audit reports with unimplemented recommendations  13‐14 

5(a)(11)  Significant revised management decisions  None 

5(a)(12)  Significant management decisions with which 

General disagreed 

the Inspector  None 

5(a)(13)  Compliance of Agency financial management system  11 

5(a)(14)(15)  Peer reviews conducted of this OIG  26 

5(a)(16)  Peer reviews conducted by this OIG  27 

5(a)(17)  Statistical tables for investigations and referrals  28 

5(a)(19)  Investigations of a senior government employee with 

substantiated misconduct  None 

5(a)(20)  Instances of whistleblower retaliation  None 

5(a)(21)  Instances of attempts to interfere with IG independence  None 

5(a)(22)(A)  Closed audits not disclosed to the public  None 

5(a)(22)(B)  Closed investigations involving a senior government employee  None 

845  National Defense Authorization Act for FY 2008 requirement 

(Pub. L. 110‐181)  21 
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

23 

   

 Appendix B 

Audit, Inspection, and Evaluation Reports Issued

Recommendations 

Number of Agreed Upon  Report  Questioned Costs  That Funds Be Put to  Actions/Recommendations  Better Use 

FCA’s Contracting  7  $0  $0  Activities 

Physical Security in 

FCA’s Denver Field  5  $0  $0 

Office 

Total  12  $0  $0 
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

24 

 

 Appendix C 

Reports with Questioned Costs

Number  Dollar Value 

  

   Reports  Recommendations  Questioned 

Costs 

Unsupported 

Costs 

A.  For which no management decision has 

been made by the commencement of the 

reporting period. 

0  0  $0  $0 

B. Which were issued during the reporting 

period.  0  0  $0  $0 

Subtotals (A+B)  0  0  $0  $0 

C.  For which a management decision was 

made during the reporting period.  0  0  $0  $0 

     (i)   dollar value of disallowed costs  0  0  $0  $0 

     (ii)  dollar value of costs not disallowed  0  0  $0  $0 

D. For which no management decision has 

been made by the end of the reporting 

period. 

0  0  $0  $0 

E.  For which no management decision was 

made within six months of issuance.  0  0  $0  $0 
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

25 

   

 Appendix D 

Reports with Recommendations that Funds  

Be Put to Better Use 

   Number of  Number of  Dollar 

Reports  Recommendations  Value 

A.  For which no management decision has been  

     made by the commencement of the reporting  0  0  $0 

     period.  

B.  Which were issued during the reporting  0  0  $0    period. 

Subtotals (A+B)  0  0  $0 

C.  For which a management decision was made  0  0  $0       during the reporting period. 

     (i)   dollar value of recommendations that  0  0  $0    were agreed to by management 

          ‐ based on proposed management action  0  0  $0 

          ‐ based on proposed legislative action  0  0  $0 

    (ii)  dollar value of recommendations that  0  0  $0    were not agreed to by management 

D.  For which no management decision has been  0  0  $0       made by the end of the reporting period. 

E.  For which no management decision was   0  0  $0       made within six months of issuance. 
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

26 

 Appendix E 

Peer Reviews Conducted of this Office 

Function  Peer Review  Peer Review Performed By  Date of Report   Reviewed  Rating 

Federal Labor Relations Authority OIG  August 2, 2016  Audit   Pass 

Architect of the Capitol OIG  June 26, 2013  Audit   Pass 
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

27 

 Appendix F 

Peer Reviews Conducted by this Office 

Function  Peer Review  Peer Review Of  Date of Report   Reviewed  Rating 

Federal Election Commission OIG  February 15, 2017  Audit  Pass 

U.S. International Trade Commission OIG  January 16, 2013  Audit  Pass 
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

28 

 Appendix G 

Investigative Reports, Referrals, Indictments, and Criminal Information 

A. Total number of investigative reports issued during the reporting  4  period 

B. Total number of persons referred to the Department of Justice for  0  criminal prosecution during the reporting period 

C. Total number of persons referred to state and local prosecuting  0  authorities for criminal prosecution during the reporting period 

D. Total number of indictments and criminal information during the 

reporting period that resulted from any prior referral to  0 

prosecuting authorities 

E. Description of the metrics used for developing the data in this 

statistical table: FCA OIG has included the above‐referenced 

statistics for the reporting period from April 2017 through  0  September 2017 in these statistics. Investigative reports included in 

this table are all those for which a Report of Investigation was 

issued during the reporting period. 
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

29 

 Appendix H 

FCA ORGANIZATIONAL CHART 
FCA OIG Semiannual Report to the Congress 

April 1, 2017—September 30, 2017

https://www.fca.gov/home/inspector.html 

30 

 Appendix I 

Glossary 

Agency  –  Farm Credit Administration 

CCIG  –  Council of Counsels to the Inspectors General 

CIGIE  –  Council of the Inspectors General on Integrity and Efficiency 

COR  –  Contracting Officer’s Representative 

Farm Credit Act   –  Farm Credit Act of 1971, as amended 

Farmer Mac  –  Federal Agricultural Mortgage Corporation 

FCA  –  Farm Credit Administration 

FCS  –  Farm Credit System 

FISMA  –  Federal Information Security Modernization Act 

FY  –  Fiscal Year 

H.R.  –  House of Representatives 

IG  –  Inspector General 

IGEA  –  Inspector General Empowerment Act of 2016 

IG Act  –  Inspector General Act of 1978, as amended 

IT  –  Information Technology 

OAS  –  Office of Agency Services 

OE  –  Office of Examination 

OIG  –  Office of Inspector General 

OIT  –  Office of Information Technology 

OMB  –  Office of Management and Budget 

ORP  –  Office of Regulatory Policy 

OSMO  –  Office of Secondary Market Oversight 

PPM  –  Policies and Procedures Manual 

Pub. L.  –  Public Law 

S.  –  Senate 

System  –  Farm Credit System 

YBS  –  Young, Beginning, and Small Farmers 
FARM CREDIT ADMINISTRATION 

OFFICE OF INSPECTOR GENERAL

Report Fraud, Waste, Abuse, Mismanagement 

Phone:  Toll Free (800) 437‐7322; (703) 883‐4316 

Fax:  (703) 883‐4059 

E‐mail:  fca‐ig‐hotline@rcn.com

Mail:  Farm Credit Administration 

Office of Inspector General 

1501 Farm Credit Drive 

McLean, VA  22102