U.S. COMMODITY FUTURES TRADING COMMISSION

Office of the Inspector General

Office of Audits

Report Number: 22-AU-03 

June 17, 2022

Compliance Review: 

Payment Integrity Information 

Act of 2019
U.S. COMMODITY FUTURES TRADING COMMISSION

 Three Lafayette Centre

 1155 21st Street, NW, Washington, DC 20581

 Telephone: (202) 418-5110

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Introduction 

To fulfill our obligations required by the Payment Integrity Information Act (PIIA)

of 2019,1 the Office of the Inspector General (OIG) completed a review of the 

U.S. Commodity Futures Trading Commission’s (CFTC) compliance with the 

PIIA. The objectives of this review were to: 

• Determine whether the CFTC is compliant with the PIIA Act of 2019 given 

that it did not report on payment integrity in its 2021 Financial Statements.

• Perform an independent risk assessment of CFTC payments to determine 

whether CFTC is a Phase 1 or Phase 22 agency. 

We conducted this review in accordance with Generally Accepted Government 

Auditing Standards (GAGAS).

 

1 The PIIA (P.L. No. 116-117, codified at 33 USC § 3352, et seq.) requires the Inspector General of each 

executive agency to determine whether the executive agency is in compliance [with PIIA] and submit a 

report on the determination to the head of the executive agency; the Committee on Homeland Security and 

Governmental Affairs of the Senate; the Committee on Oversight and Reform of the House of 

Representatives; and the Comptroller General of the United States. OMB guidance added the Controller of 

the Office of Management and Budget and the appropriate authorizing and appropriations committees of 

Congress to report submission. 

Office of Management and Budget (OMB) M-21-19, Appendix C to OMB Circular A-123, Requirements for 

Payment Integrity Improvement, states “every year, each agency Inspector General reviews relevant 

[improper (IP) and unknown payment (UP)] reporting and records pertaining to the programs within an 

agency to determine whether the agency complies with PIIA and OMB guidance.” 

2 Phase 1 agencies are defined as those below an improper payment threshold of $10 million and 1.5% of 

outlays for FY 2021; otherwise a Phase 2 designation. Outlays generally means payments.

TO: Rostin Behnam, Chairman 

Kristin Johnson, Commissioner

Christy Goldsmith Romero, Commissioner

Summer Mersinger, Commissioner

Caroline Pham, Commissioner

FROM: Miguel A. Castillo, CPA, CRMA

DATE: June 17, 2022 

SUBJECT: Compliance Review: Payment Integrity Information Act of 2019
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Executive Summary 

Unlike previous years, the CFTC did not include a distinct discussion of payment 

integrity in its FY 2021 Agency Financial Report (AFR) and thus was noncompliant with PIIA reporting requirements. However, our independent risk 

estimates indicate that CFTC is a Phase 1 agency and are well below the 

established threshold for improper payments set at $10 million and 1.5% of total 

payments for FY 2021. Specifically, we are 95% confident the risk of improper 

payments are no greater than $202,108.54 or 0.06% of outlays for FY 2021.

Table 1. shows the areas of non-compliance as required by OMB instruction. 

Table 1 - Per OMB M-21-19

Note: To determine compliance under PIIA, we reviewed the Agency's Financial Report (and any accompanying 

information) for the most recent fiscal year (2021). If an agency does not meet one or more of these requirements then it 

is not compliant under PIIA. Source: https://www.whitehouse.gov/wp-content/uploads/2021/03/M-21-19.pdf

CFTC’s Office of Financial Management (OFM), housed within the CFTC 

Division of Administration (DA), indicated that due to its historical low improper 
3 | Page

payment risk, its continuous attention to internal controls, and it’s PIIA reporting 

discussions with Office of Management and Budget, it believed a distinct 

payment integrity discussion was not meaningful for the FY 2021 AFR. We 

agree that CFTC’s internal controls historically demonstrated low payment risk 

and note that OFM did not consult CFTC’s General Counsel for PIIA compliance

interpretations. 

Recommendations:

As distinctly included by OFM in previous fiscal year's Agency Financial Reports 

(AFR), we recommend the Financial Management Office:

1. Include payment integrity analysis with relevant links and estimates in 

future AFRs as required by OMB M-21-19;

3 and

2. Seek counsel for interpreting general law matters such as PIIA 

compliance. 

Managements Comments and Our Evaluation 

We provided management a draft copy of the report. Management concurred 

with recommendation 1 and noted that reporting guidance in the Fiscal Year (FY) 

2021 Office of Management and Budget (OMB) Circular A-136, Financial 

Reporting Requirements, was streamlined from prior years to reduce agency 

reporting burden and did not clearly articulate responsibilities for all federal 

entities. In reference to recommendation 2, management asserted it seeks and 

will continue to seek general law interpretations when deemed necessary. 

Management noted that OMB has acknowledged the [instruction] discrepancy 

and has worked to clarify the requirements surrounding PIIA reporting. These 

actions are responsive to the report finding and recommendations and we will 

perform a follow-up review of CFTC’s FY 2022 AFR submission. 

See Appendix A for further report details; Appendix B for additional background, 

scope, and methodology; and Appendix D for management comments in their 

entirety. We will publish this report on the Office of the Inspector General’s web 

page and the report will be summarized in our September 2022 Semiannual 

Report to Congress. If you have any questions, please contact me at (202) 418-

5084 or Tony Baptiste, Senior Program Analyst and lead for this report, at (202) 

418-5115. 

 

3 OMB M-21-9 (and required by statute. 31 U.S.C. 3351(2). 
4 | Page

Cc: 

Senator Lt. Commander Gary C. Peters, Chairman

Senate Committee on Homeland Security and Governmental Affairs

340 Dirksen Senate Office Building, Washington, DC 20510 

Email April Beasley: april_beasley@hsgac.senate.gov 

Senator Robert J. "Rob" Portman, Ranking Member

340 Dirksen Senate Office Building, Washington, DC 20510 

Office Email: reports_@hsgac.senate.gov 

Representative Carolyn B. Maloney, Chairwoman 

House Committee on Oversight and Reform

2157 Rayburn House Office Building, Washington, DC 20515 

Office Email: oversight.democrats@mail.house.gov 

Representative James R. Comer, Ranking Member

House Committee on Oversight and Reform

2105 Rayburn House Office Building, Washington, DC 20515 

Mallory Baker: Email Mallory.Baker@mail.house.gov 

Senator Patrick Leahy, Chairman

Senate Committee on Appropriations 

Room S-128, The Capitol, Washington, D.C. 20510

Mike Gentile: Email Mike_Gentile@appro.senate.gov

Senator, Richard Shelby, Vice Chairman

Senate Committee on Appropriations 

Room S-128, The Capitol, Washington, D.C. 20510

Anna Lanier: Email AnnaLanier_Fischer@appro.senate.gov

Rosa L. DeLauro, Chairwoman

House Committee on Appropriations 

H-307 The Capitol, Washington, DC 20515

Jaclyn Kilroy: Email Jaclyn.Kilroy@mail.house.gov

Kay Granger, Ranking Member

House Committee on Appropriations 

H-307 The Capitol, Washington, DC 20515

Kathryn Salmon: Email Kathryn.Salmon@mail.house.gov
5 | Page

Senator Debbie Stabenow, Chairwoman

Senate Committee on Agriculture, Nutrition and Forestry

328A Russell Senate Office Building Washington, D.C. 20510

Office email: reports@ag.senate.gov

Senator, John Boozman, Ranking Member

Senate Committee on Agriculture, Nutrition and Forestry

328A Russell Senate Office Building Washington, D.C. 20510

Office email: reports@ag.senate.gov

Representative David Scott, Chairman

House Agriculture Committee

1301 Longworth House Office Building, Washington, DC 20515

Email Emily German: Emily.German@mail.house.gov

Representative Glenn Thompson, Ranking Member

House Agriculture Committee

1301 Longworth House Office Building, Washington, DC 20515

Email Paul Balzano: Paul.Balzano@mail.house.gov

Office of Management and Budget (OMB)

Upload final report to OMB’s Max page at: 

Payment Integrity Information Act Required Submissions to OMB

Gene Dodaro, Comptroller General 

U.S. Government Accountability Office

441 G St. NW, Washington DC, 20548 

Email: IPcompliancereports@gao.gov
6 | Page

Cc:

David Gillers, Chief of Staff

Bruce Fekrat, Chief Counsel

Nora Flood, Senior Counsel and Policy Advisor

Christopher Lucas, Chief of Staff

Meghan Tente, Chief of Staff

Robert Schwartz, General Counsel

Tomeka Gilbert, Acting Executive Director

Joel Mattingley, Chief Financial Officer

Keith A. Ingram, Accounting Officer

John Rogers, Senior Advisor

A. Roy Lavik, Inspector General

Judith A. Ringle, Deputy Inspector General and Chief 

Counsel
7 | Page

Appendix A

Non-Compliance with PIIA Reporting

Condition:

Unlike previous years, the CFTC did not include a distinct discussion of payment 

integrity in the agency annual financial statement or post accompanying 

materials separately on the agency website.

Criteria

Office of Management and Budget (OMB) M-21-19, Appendix C to OMB Circular 

A-123, Requirements for Payment Integrity Improvement, requires agencies to 

ensure compliance with PIIA each year.4 If a program does not meet one or more 

of the following requirements then it is not compliant under PIIA: 

Published payment integrity information with the annual financial 

statement. To achieve compliance the agency must publish any 

applicable payment integrity information in its annual financial statement in 

accordance with payment integrity guidance provided in OMB Circular 

A136. In addition, the agency must publish any applicable payment 

integrity information required in the accompanying materials to the annual 

financial statement in accordance with applicable guidance. 

Posted the annual financial statement and accompanying materials on 

the agency website. To achieve compliance the agency must include a 

link to paymentaccuracy.gov within its annual financial statement to any 

accompanying materials to the annual financial statement required under 

guidance from OMB and then publish their annual financial statement on 

their agency website. 

Adequately concluded whether the program is likely to make improper 

payments (IPs) and unknown payments (UPs) above or below the 

statutory threshold. This requirement includes the adequacy of the 

program IP risk assessment when determining program compliance.5 

 

4 This is also required by statute. 31 U.S.C. 3351(2). 

5 Per its FY 2021 FMFIA internal control risk assessment, CFTC assessed its major business cycles at a 

“low-to-moderate risk” level. It’s testing of management controls surrounding the Fund Balance with 

Treasury and other cycles of payment origination were satisfactory. Key control activities were functioning 

effectively and continuously throughout the period under review. In addition, the contracted independent 

public accountant did not identify internal controls weaknesses related to outlays when conducting its FY 

2021 AFR audit. 
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Cause 

CFTC’s OFM indicated that due to its historical low improper payment risk, its 

continuous attention to internal controls, and it’s PIIA reporting discussions with 

the Office of Management and Budget, it believed a distinct payment integrity 

discussion was not meaningful for the FY 2021 AFR.

We inquired from CFTC’s General Counsel whether OFM sought guidance

concerning PIIA compliance. CFTC’s General Counsel stated OFM did not seek 

legal advice from the legal division concerning CFTC’s PIIA compliance and 

therefore has no position regarding whether the CFTC is out of compliance with 

the PIIA payment integrity reporting requirement. See Appendix C for General 

Counsel responses to our inquiry.

Effect

Non-compliance with laws and regulations; Payment Integrity Information Act 

(PIIA) of 2019. 
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CFTC Below Improper Payment Threshold 

Condition:

The OIG independently assessed improper payment risk for FY 2021 and 

concluded that the CFTC is a Phase 1 agency given payment risk is well below 

the established OMB threshold; improper payments greater than $10 million and 

1.5% of outlays. 

Statistical Analysis 

The OIG conducted normality tests of CFTC’s FY 2021 outlays or payments by 

object class.

6 The empirical rule states that 99.7% of data observed following a 

normal distribution lies within 3(z)7 standard deviations of the mean. We initially 

grouped outliers into 2 categories and tested payment integrity thereafter. 

Group 1 - Non-Payroll Results

Non-Payroll Object Class Descriptions Outlier 

Count

Outlier Amount

Credit Card Interface Default 42 $ 359,100.97 

Operation & Maintenance of Furniture & Equipment 1 $ 873.90 

Grand Total 43 $ 359,974.87 

Non-payroll outliers represented 0.28% of dollar value in this category of outlays.

Payment integrity tests of extreme values confirmed that tested transactions 

were appropriately justified and approved. Figure 1 depicts and exemplifies 

outliers in this category.

 

6 Categories in a classification system that presents obligations by the items or services purchased by the 

Federal Government. Each specific object class is defined in OMB Circular A-11 Section 83.6. 7 Z-scores offer analysts a way to compare data against a norm. Z-score results of zero indicate that the 

data point being analyzed is exactly average, situated among the norm. The higher the Z-score, the further 

from the norm the data can be considered to be.
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Figure 1 – Non-Payroll Extreme Value Analysis

The extreme value examined related to payment for federal executive training 

that was appropriately vetted and approved.

Group 2 - Payroll Results

Payroll Object Class Descriptions

Correlating to CT Series

Outlier 

Count

Outlier Amount

Federal Employees Group Life Insurance (FEGLI) 13 $ (77.72)

Federal Employees Retirement System (FERS) 26 $ (22,511.04)

Full-Time Permanent Appointments 28 $ (212,907.77)

Health Insurance – Federal Employees Health 

Benefits Act (FEHB)

56 $ (46,787.13)

Hospital Insurance Tax (HIT) 24 $ (4,935.45)

OASDI FICA – FERS – Full Contribution 30 $ (20,189.62)

Temporary Appointments 8 $ 19,237.48 

Thrift Savings Plan (TSP) Basic 28 $ (1,277.66)

Thrift Savings Plan (TSP) Matching 26 $ (5,279.38)

Grand Total 239 $ (294,728.29)
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Figure 2. Payroll Extreme Value Analysis (CT Correlation)

Payment integrity tests of extreme values confirmed that tested transactions 

were appropriately justified and approved. Figure 2 depicts and exemplifies 

payroll outliers that correlated to CT series (employment pay level). The extreme 

value examined was simply a reclassification of funds due to retroactive action to 

move an employee from the Division of Administration to the Division of 

Administration Information Technology Branch. No actual payment was made.

Payroll Object Class Descriptions

NOT Correlated to CT Series

Outlier 

Count

Outlier Amount

Holiday 3 $ (7,506.52)

Civil Service Retirement System (CSRS) Agency

Contribution

3 $ (1,105.14)

Retention Allowance 17 $ (23,224.56)

Student Loan Program 1 $ (50,000.00)

Supplemental Dental 185 $ (46,119.27)

Time-Off Awards 15 $ (76,719.46)

Grand Total 224 $ (204,674.95)
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Figure 3. Payroll Extreme Value Analysis (NO CT Correlation)

Payment integrity tests of extreme values confirmed that tested transactions 

were appropriately justified and approved. Figure 3 depicts and exemplifies 

payroll outliers that we did not correlate to CT series (employment pay level). The 

extreme value examined relates to an employee who used a time off award in his 

final pay period with CFTC. Overall, payroll outliers represented 0.26% of the 

dollar value for these categories of outlays.

Given that none of outliers sampled were improper payments, we are 95% 

confident that payment outliers which represent the risk of improper 

payments are no greater than $202,108.548 or 0.06% of outlays for FY 2021; 

well below thresholds set for improper payments. This is in-line with the absence 

of internal control deficiencies attested by CFTC’s independent public auditor and 

internal control tests conducted by CFTC during FY 2021 that indicated low to 

moderate risk. 

Criteria

OMB-21-19, Appendix C to OMB Circular A-123, Requirements for 

Payment Integrity Improvement, calls for agencies to perform improper payment 

(IP) risk assessments and for the IGs to evaluate these assessments. Agencies 

should assess all programs with annual outlays greater than $10,000,000 for risk 

at least once every three years. The purpose of a risk assessment is to 

 

8 ($859,378.11 x 23.518%) at 3z or deviations. 
13 | Page

determine whether the total annual IPs plus unknown payments (UPs) for a 

program are collectively likely to be above or below the statutory threshold for the 

given year. If the assessment determines that it is likely that the program’s IPs 

plus the program’s UPs are above the statutory threshold then, the following year 

the program should produce a statistically valid estimate of the programs IPs and 

UPs. If the IP risk assessment demonstrates that the program is not likely to 

make IPs and UPs above the statutory threshold, then the program will 

not produce a statistically valid estimate in the following year and instead will 

conduct another IP risk assessment in three years. Inspectors Generals 

determine whether the program is likely to make IPs and UPs above or below the 

statutory threshold. 

Cause 

We attribute CFTC’s Phase 1 status and low to moderate risk for improper 

payments to OFM’s historical continuous attention to ensuring effective internal 

controls and financial risk management.

Effect

CFTC is readily able to comply with PIIA reporting requirements in future AFRs. 
14 | Page

Appendix B

Background 

The Payment Integrity Information Act of 2019 (PIIA) was signed into law in 

March 2020 to decrease the amount of improper payments made by the United 

States Government. The PIIA changed the government-wide improper payment 

reporting requirements by repealing and replacing the Improper Payments 

Information Act of 2002, the Improper Payments Elimination and Recovery Act of 

2010, the Improper Payments Elimination and Recovery Act of 2012, and the 

Fraud Reduction and Data Analytics Act of 2015. It adopted and modified certain 

requirements from the laws that it repealed or replaced and added new 

requirements. One of the primary changes made by the PIIA relates to new risk 

factors that are to be embedded into federal entities’ improper payment risk 

assessments. These factors are:

• Similarities to other programs that have reported improper and unknown

payment estimates or have been deemed susceptible to significant 

improper payments.

• Accuracy and reliability of improper and unknown payment estimates 

previously reported for the program or other indicators of potential 

susceptibility to improper payments.

• Whether the program lacks information or data systems to confirm 

eligibility or provide for other payment integrity needs.

• Risk of fraud as assessed by the federal entities under the Standards for 

Internal Control in the Federal Government issued by the Government 

Accountability Office, also referred to as the Green Book.

PIIA established responsibilities for the Office of Management and Budget (OMB) 

to issue implementation guidance and for establishing an interagency working 

group on payment integrity. The result from these initial efforts was OMB M-21-

19, dated March 5, 2021, Appendix C to OMB Circular A-123, Requirements for

Payment Integrity Improvement. This appendix focuses on developing a more 

comprehensive and meaningful set of requirements that reduces low-value 

activities, allows federal entities to spend more time performing root cause 

analyses of improper and unknown payments, balances risks and controls, and 

improves the ability to prevent future improper and unknown payments.

Each FY, the agency is responsible for ensuring it has met the requirements to 

achieve compliance with PIIA and the OIG is responsible for evaluating the 

agency to determine whether the agency is compliant with PIIA. The IG is 

responsible for submitting a report on that determination. The OIG review of the 
15 | Page

accompanying materials to the FY2021 annual financial statement will be 

considered year 1 of a PIIA compliance review and all programs will consider 

the resulting OIG compliance report to be year 1 of the report for the purpose of 

implementing OMB guidance.

Scope and Methodology 

The objectives of this review were to:

1. Determine whether the CFTC is compliant with the PIIA Act of 2019 given that 

it did not report on payment integrity in its 2021 Financial Statements; and,

2. Perform an independent risk assessment of CFTC payments to determine 

whether CFTC is a Phase 1 or Phase 2 agency.

We conducted this review in accordance with Generally Accepted Government 

Auditing Standards (GAGAS).

To answer objective one, we:

• Interviewed and/or inquired with key officials in the OFM and Legal 

Division;

• Reviewed internal control cycle memo and tests of controls; 

• Reviewed relevant AFRs; and

• Sought input from OIG Counsel 

To answer objective two, we:

• Obtained and analyzed payment/accounting data for quality;

• Contracted analytic experts9 to perform tests of normality by object class 

and/or CT series using SAS and Python tools;

• Selected and tested payment outliers set at 3z or standard deviations from 

averages; 

• Examined extreme value using Tableau; and

• Projected test result to estimate maximum dollar potential for improper 

payments using RATS-STATS 2010 v.4. Single stage attribute appraisal 

results are depicted below: 

 

9 We contracted with Analytica, an SBA Certified 8(a), HUBZone small business consulting and technology 

firm that specializes in public sector analytics & visualization requirements including data science solutions 

such as tests of normality.
16 | Page

The population of outliers from our tests of normality was 506 payments. A 95% 

confidence level was used to estimate the upper limit of improper payments for 

FY 2021.

In reference to internal controls, management is responsible for the design, 

implementation, and operating effectiveness of the agency’s internal controls. 

A control deficiency in internal control exists when the design or operation of a 

control does not allow management or employees to prevent or detect and 

correct errors on a timely basis. A significant deficiency is a control deficiency or 

a combination of control deficiencies that adversely affects CFTC’s ability to 

initiate, authorize, record, process, or report financial data reliably. A material 

weakness is a significant deficiency, or combination of significant deficiencies, 

that results in more than a remote likelihood that a material error will not be 

prevented or detected. 

 Windows RAT-STATS

 Statistical Software

Date: 5/7/2022 Single Stage Attribute Appraisal Time: 11:59

 REVIEW:PIIA 2019 

 OUTPUT FILE: C:\Users\mcast\OneDrive\Documents\FY 2021 PIIA.txt

 UNIVERSE SIZE 506

 SAMPLE SIZE 11

 CHARACTERISTIC(S) OF INTEREST

 QUANTITY IDENTIFIED IN SAMPLE 0

 PROJECTED QUANTITY IN UNIVERSE 0 

 PERCENT .000%

 STANDARD ERROR

 PROJECTED QUANTITY 0

 PERCENT .000%

 CONFIDENCE LIMITS

 80% CONFIDENCE LEVEL

 UPPER LIMIT - QUANTITY 68

 PERCENT 13.439%

 90% CONFIDENCE LEVEL

 UPPER LIMIT - QUANTITY 94

 PERCENT 18.577%

 95% CONFIDENCE LEVEL

 UPPER LIMIT - QUANTITY 119

 PERCENT 23.518%

 SINCE NO ITEMS HAVING THE CHARACTERISTIC(S) OF INTEREST WERE FOUND IN THE

 SAMPLE, THE PROGRAM HAS CALCULATED ONLY THE MAXIMUM NUMBER OF ITEMS

 HAVING THE CHARACTERISTIC(S) OF INTEREST IN THE UNIVERSE.

Figure 4 – Attribute Appraisal Results
17 | Page

We assessed applicable payment internal controls to determine the nature, 

timing, and extent of testing in accordance with GAO’s Standards for Internal 

Control in the Federal Government. As part of our assessment, we reviewed 

fiscal year 2021 management assurance statements and risk assessments and 

determined that no significant deficiencies or material weaknesses were 

identified. 

We assessed CFTC’s payment reporting risk “low” because: 

• FY 2019, 2020, and 2021 internal control tests performed by independent 

public accountants (IPA) contracted by OIG did not identify material or 

significant control deficiencies related to payments. Our review of the 

IPA’s internal control work papers and test results also did not reveal 

control deficiencies for this matter.

 

• Our independent analytic tests showed rates far below tolerable.

• CFTC’s accounting and payroll system service providers (U.S. 

Department of Transportation Enterprise Service Center and U.S. 

Department of Agriculture, National Finance Center, respectively) did not 

disclose material payment weaknesses in their independent audit 

reports.10 

We conducted this review in accordance with Generally Accepted Government 

Auditing Standards (GAGAS). Systems data used for our review was sufficiently 

reliable to support the findings, conclusions and recommendations in our 

report.11 In particular we analyzed system internal control reports and performed 

analysis of journal vouchers to assess the data quality of payment data used.

 

10 Independent Service Auditor’s Report on National Finance Center's Description of Its Payroll and 

Personnel Systems and the Suitability of the Design and Operating Effectiveness of Its Controls for the 

period October 1, 2020 through June 30, 2021. 

Quality Control Review of the Independent Auditor’s Report on DOT’s Enterprise Services Center, October 

1, 2020, through June 30, 2021. 11 We considered the Government Accountability Office publication Assessing the Reliability of ComputerProcessed Data, GAO-09-680G (July 2009) to assess the quality of data. We determined that payment data 

were sufficiently reliable for the purposes of this report.
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Appendix C - General Counsel PIIA Responses 

Legal Division 

TO: Judith Ringle, DIG/Counsel, Office of Inspector General 

FROM: Rob Schwartz, General Counsel~-

John Einstman, Deputy General Counsel (General Law) 

DATE: February 15, 2022 

SUBJECT: Legal Division Response to OIG's January 25, 2022 Compliance Review 

Memorandum Entitled "Identification of conflict between the Payment 

Integrity Information Act of 2019 and applicable 0MB Guidance; request 

that LD advise OFM" 

U.S. COMMODITY FUTURES TRADING COMMISSION 

Three Lafayette Centre 

1155 21st Street, NW, Washington, DC 20581 

Telephone (202) 418-5320 

Facsimile: (202) 418-5523 

www.cftc.gov 

MEMORANDUM 

In your above-referenced memorandum, you requested that the Commission's Legal 

Division ("LD") address, "on CFTC letterhead," three bullet points related to your compliance 

review of the Agency's compliance with the Payment Integrity Information Act of 2019, 

33 U.S.C. §§ 3351 et seq. ("PUA"). After coordination with the Commission's Office of 

Financial Management ("OFM"), please find our responses set forth immediately below and 

attached: 

• Did OFM seek legal advice from the Legal Division concerning PIIA compliance? If so 

please provide us copies of the legal advice. Ifnot, please advise both OFM and OIG on 

the Legal Division's position concerning CFTC compliance with the PIIA payment 

integrity reporting requirement, outlined above. 

No, OFM did not seek legal advice from LD concerning CFTC PIIA compliance. LD 

therefore has no position regarding whether the CFTC is out of compliance with the PIIA 

payment integrity reporting requirement. At this time, we are unaware of any information 

suggesting that the agency is out of compliance. If your office is aware of any such information, 

we request that you provide it. 

Page 1 
19 | Page

• What base year is in effect for CFTC to comply with the PIIA payment integrity 

reporting requirement? 

LD does not review either 0MB Circulars or Agency responses to 0MB Circulars unless 

specifically requested by OFM. Because OFM did not request LD review of either the 0MB 

Circular at issue (A-136) or OFM's interpretation of PIIA requirements, OFM has requested that 

LD direct OIG to OFM concerning this question. 

• Please provide all communications between CFTC and 0MB concerning compliance 

with the PIIA's payment-integrity reporting requirement. Ifthere is a specific point of 

contact at 0 MB we should contact, please provide contact infonnation. 

Attached please find all requested communications. OFM communicates with 0MB 

concerning PIIA compliance via an 0MB e-mail inbox that is not tied to a specific 0MB 

employee. 

If you would like to discuss this issue further please contact me at rschwartz@cftc.gov. 

Page 2 
20 | Page

Appendix D - Management Comments

Division of 

Administration 

TO: Miguel A. Castillo, Assistant Inspector General for Audits 

U.S. COMMODITY FUTURES TRADING COMMISSION 

Three Lafayette Centre 

1155 21st Street, NW, Washington, DC 20581 

Telephone: (202) 418-5003 

Facsimile: (202) 418-5530 

MEMORANDUM 

FROM: Tomeka Gilbert, Acting Executive Director and Chief Administrative 

Officer, Division of Administration 

Joel Mattingley, 

Chief Financial Officer 

DA TE: June 15, 2022 

SUBJECT: Commodity Futures Trading Commission Management Response to the 

Office of Inspector General Compliance Review: Payment Integrity 

Infonnation Act of2019 

l11ank you for the opportunity to comment on the Office of the Inspector General 's 

(OIG) draft report number 22-AU-03, Compliance Review: Payment Integrity 

Information Act of2019 (PIIA). Management's comments to the recommendations 

described in the report are as follows: 

Recommendation #1: 

Include payment integrity analysis with relevant links and estimates in future AFRs 

as required by 0MB M-21-19. 

Management Response: 

Management concurs with the recommendation and will include payment integrity 

reporting in its FY 2022 Agency Financial Report (AFR). PIIA reporting guidance 

in the Fiscal Year (FY) 2021 Office of Management and Budget (0MB) Circular A136, Financial Reporting Requirements, was streamlined from prior years to reduce 

agency reporting burden and did not clearly articulate responsibilities for all federal 

entities (see below A-136 excerpt). 
21 | Page

11.4.5. Payment Integrity Information Act Reporting 

Infonuation previously contained in this section that is not explicitly required below will be 

collected by 0MB through tlie Annual Data Call and published on PavmentAccuracy. 1mv. 

Agencies should consult the Annual Data Call guidance (https://comnmnity.max.2ov/x/HsVHg) 

to detemwe which requirements apply to them. If an agency provides iufomiation to 0MB 

through the Annual Data Call, then the agency must include the website hyperlink for 

PaymentAccuracy.gov in their AFR or PAR 

The Payment Integrity Infomiation Act of2019 (Pub. L. No. 116-117, 31 U.S.C. § 3352) 

requires that actions taken to address recovery auditor recommendations should be addressed in 

the AFR or PAR If an agency has a recovery audit program and has received recommendations 

from their recovery auditors regarding actions tliat can be taken to prevent oveipayme.nts, the 

agency should report on actions taken_ 

FY 2021 A-136 PIIA reporting requirements were limited to reporting on recovery 

audit programs and providing a hyperlink to PaymentAccuracy.gov only if the 

agency provided information to 0 M B through the annual data call. CFTC did not 

receive an invitation to the annual PIIA data call from 0MB for FY 2021 and does 

not have a recovery audit program; as such, CFTC did not include a section on PIIA 

compliance in its FY 2021 AFR. 

CFTC followed 0MB PIIA guidance in Appendix C to 0MB Circular A-123, 

Requirements for Payment Integrity Improvement, to determine the agency's Phase I 

status for both of its programs. CFTC has a robust internal controls program and 

performed numerous internal control reviews and tests to ensure payment integrity. 

Furthermore, CFTC met with 0 M B on February 22, 2022, to discuss PIIA reporting 

requirements that apply to CFTC and expects to receive an invitation to the annual 

data call from 0MB for FY 2022. During that discussion, CFTC also highlighted 

the conflicting requirements in the PIIA and A-136; as a result, the draft FY 2022 A136 PIIA reporting requirements and emails from 0 M B to the PIIA listserv have 

been significantly clarified. 

As noted in the 010 review, CFTC does not have a significant level of improper 

payments and continues to implement effective internal controls and review 

processes to prevent and detect improper payments. 

Recommendation #2: 

Seek counsel for interpreting general law matters such as PIIA compliance. 

Management Response: 

CFTC management seeks, and will continue to seek, general law interpretations on a 

variety of compliance issues, when deemed necessary. Management did not deem 

consultation with general law concerning the PIIA issue noted in the OIG review 

necessary because it was a result of 0 MB issuing financial reporting requirements that 

are not in sync with the PIIA. 0MB has acknowledged the discrepancy and has worked 

to clarify the requirements surrounding PIIA reporting. 

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Cc: 

David Gillers 

Rob Schwartz 

Natasha Coats 

Nora Flood 

Christopher Lucas 

Meghan Tente 

John Rogers 

Keith Ingram 

Roy Lavik 

Rudith Ringle 

Sincerely, 

To ME KA GILBERT Digitally signed by TOMEKA GILBERT 

Date: 2022.06.15 13:30:43 -04'00' 

Tomeka Gilbert 

Acting Executive Director and Chief Administrative Officer

JOEL MATT ING L Ey Digrtally signed by JOEL MATTINGLEY 

Date: 2022.06.15 11 :42:45 -04'00' 

Joel Mattingley 

Chief Financial Officer 

Date 

Date 

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