Office of Inspector General 

Semiannual Report to Congress 

Covering the Period 

 

April 1, 2021 – September 30, 2021 

FEDERAL MARITIME COMMISSION 
FEDERAL MARITIME COMMISSION

Washington, DC 20573

October 29, 2021 

Office of Inspector General

Dear Chairman Maffei and Commissioners Dye, Khouri, Sola and Bentzel: 

The following report is submitted in accordance with Section 5 of the Inspector General 

Act of 1978, as amended. This report summarizes the activities of the Federal Maritime 

Commission (FMC) Office of Inspector General (OIG) for the period April 1, 2021 to September 

30, 2021. 

During this reporting period, the OIG continued one audit, initiated two annual audits, and 

completed an audit peer review for another Federal OIG. The OIG also completed a follow-up 

review on the status of outstanding recommendations contained in the OIG’s 2018 Evaluation of 

the FMC’s Information Technology Inventory. Additional details on these assignments can be 

found in the enclosed report. 

The OIG continues to appreciate the cooperation and commitment to integrity and ethical 

values demonstrated by FMC’s leadership and staff.

 Respectfully submitted, 

 Jon Hatfield 

 Inspector General

Enclosure 
TABLE OF CONTENTS

Transmittal Letter

EXECUTIVE SUMMARY............................................................................................................................... 1

FEDERAL MARITIME COMMISSION............................................................................................................ 1

OFFICE OF INSPECTOR GENERAL ................................................................................................................ 2

OFFICE OF INSPECTOR GENERAL ACTIVITIES .............................................................................................. 2

Completed Assignments........................................................................................................................................... 2

Open Audits .............................................................................................................................................................. 3

Hotline and Investigations........................................................................................................................................ 4

Memorandum of Understanding.............................................................................................................................. 4

Review of Legislation ................................................................................................................................................ 5

Council of the Inspectors General on Integrity and Efficiency (CIGIE) Activities ...................................................... 5

SUMMARY OF INSPECTOR GENERAL REPORTING REQUIREMENTS............................................................. 7

TABLE I - Summary of Reports with Corrective Actions Outstanding for More than 6 Months.................. 8

TABLE II - Listing of Reports Issued........................................................................................................... 8

TABLE III - Reports with Questioned Costs ............................................................................................... 9

TABLE IV - Recommendations that Funds be Put to Better Use ..............................................................10

Appendix A - Peer Review Activity .........................................................................................................11

Pictured: Port of Seattle

 Picture source: Courtesy of the Port of Seattle.
1 

 

EXECUTIVE SUMMARY

This semiannual report summarizes the activities and accomplishments of the Federal 

Maritime Commission (FMC), Office of Inspector General (OIG) for the six-month reporting 

period April 1, 2021 through September 30, 2021. During this reporting period, the OIG continued 

one audit, initiated two annual audits, and completed an audit peer review for another Federal OIG. 

The OIG also completed a follow-up review on the status of outstanding recommendations 

contained in the OIG’s 2018 Evaluation of the FMC’s Information Technology Inventory. 

Additional details on these assignments can be found in subsequent sections of this report. 

One hotline complaint was closed during the reporting period and four hotline complaints 

remained open at the end of this reporting period. There were no new hotline complaints received 

during this period and no open investigations or matters referred to prosecutorial authorities during 

this period. 

FEDERAL MARITIME COMMISSION

The FMC is an independent Federal agency responsible for ensuring a competitive and 

reliable ocean transportation supply system that supports the U.S. economy and protects the public 

from unfair and deceptive practices. The agency regulates the international ocean transportation 

supply system (vessel liner carriers, ocean transportation intermediaries, and marine terminal 

operators). 

The FMC is composed of five Commissioners nominated by the President and confirmed 

by the Senate, each serving a staggered five-year term. The Commission is a bipartisan body; no 

more than three members of the Commission may be of the same political party. One 

Commissioner, designated by the President, serves as the Chairman, Chief Executive, and Chief 

Administrative Officer of the Commission. The Inspector General reports to all five 

Commissioners.

Although most FMC personnel are in Washington, D.C., the FMC also maintains a 

presence in Los Angeles, Seattle, New York, New Orleans, Houston, and South Florida through 

Area Representatives. These Area Representatives serve the major ports and transportation centers 

within their respective geographic areas, and provide information, liaison, and investigatory 

services on behalf of the FMC. 
2 

OFFICE OF INSPECTOR GENERAL

The OIG was established in 1989 by the Inspector General (IG) Act of 1978, as amended 

(5 U.S.C. app.). The OIG is an independent audit and investigative unit headed by an IG who 

reports to the FMC Commissioners and Congress. The OIG is responsible for conducting audits 

and investigations relating to the programs and operations of the FMC. Audits are conducted for 

the purpose of detecting and preventing fraud, waste, and abuse, and promoting economy, 

efficiency, and effectiveness within the agency. The OIG investigations seek out facts related to 

allegations of wrongdoing on the part of FMC employees and individuals, or entities contracting 

with, or obtaining benefits from, the agency. The IG Act provides that the OIG shall have access 

to all agency records and may subpoena records from entities outside of the agency in connection 

with an audit or investigation. 

The IG is required by law to prepare this report summarizing OIG audits and investigations 

during the immediately preceding six-month period. The report is sent to the FMC 

Commissioners, the President of the Senate, the Speaker of the House and FMC’s Congressional 

appropriating and authorizing committees. This dual reporting requirement helps to ensure the 

independence of the OIG. 

To aid the FMC in accomplishing its mission, the OIG is provided two full-time positions, 

the IG and an auditor. In addition, the OIG has a memorandum of understanding (MOU) with the 

Treasury Inspector General for Tax Administration for the FMC OIG to obtain legal advice 

services to carry out its responsibilities under the Inspector General Act.

OFFICE OF INSPECTOR GENERAL ACTIVITIES

Completed Assignments

Evaluation Follow-Up. The OIG completed a follow-up of the OIG’s Evaluation of the 

FMC’s Information Technology Inventory (A18-04) to determine whether the OIG’s

recommendations have been implemented. The results of the OIG’s follow-up review determined 

that the Office of Information Technology (OIT) implemented three of the four OIG 

recommendations. Specifically, OIT has replaced the manual computer equipment inventory 

spreadsheet with a new and improved automated tracking system, and the agency’s computer 
3 

equipment has been barcoded with the new automated system. In addition, policies and procedures 

were updated to ensure the accountability of the agency’s information technology equipment. One 

recommendation remains open related to the development of a new computer inventory policy and 

agency management anticipates approval of the new policy by the 1st quarter of fiscal year 2022. 

Audit Peer Review. The OIG completed an audit peer review of the Architect of the 

Capitol (AOC) OIG during this reporting period and issued a peer review report on September 1, 

2021. The objectives of the audit peer review were to determine whether an effective quality 

control system has been established in the AOC OIG and if policies, procedures, and applicable 

government auditing standards are followed. The FMC OIG issued a pass rating and there were 

no recommendations contained in the system review report. 

Open Audits 

DATA Act Audit, 2021, A22-01. The OIG commenced the audit in early 2021 and plans 

to issue the final audit report by November 8, 2021; this is the third of three required audits of the 

DATA Act. USAspending.gov was launched in December 2007 to implement the Federal 

Funding Accountability and Transparency Act (FFATA) of 2006 by providing the public with free

centralized access to information on Federal spending. The Digital Accountability and 

Transparency Act of 2014 (DATA Act) was enacted May 9, 2014, to expand the reporting 

requirements pursuant to the FFATA. The DATA Act, in part, requires Federal agencies to report 

financial and award data in accordance with the established Government-wide financial data 

standards. 

The DATA Act also requires the Inspector General (IG) of each Federal agency to review

a statistically valid sample of the spending data submitted by its Federal agency and to submit to

Congress a publicly available report assessing the completeness, timeliness, accuracy, and quality

of the data sampled and the implementation and use of the Government-wide financial data

standards by the Federal agency.

Independent Auditors’ Report of FMC’s FY 2021 Financial Statements, A22-03. The 

audit objectives are to opine on whether the FMC’s FY 2021 financial statements follow U.S. 

Generally Accepted Accounting Principles and present fairly the financial position of the agency. 
4 

The audit will also review internal controls over financial reporting, and agency compliance with 

financial related laws and regulations. The statements to be audited are the Balance Sheet as of 

September 30, 2021, and the related Statement of Net Cost, Statement of Changes in Net Position, 

Statement of Budgetary Resources, and Statement of Custodial Activity. The final audit report 

will be issued by November 15, 2021. 

Audit of FMC’s Compliance with the Federal Information Security Modernization Act 

(FISMA) FY 2021, A22-02. The objective of the independent audit of the FMC’s information 

security program is to identify improvements for the agency’s information technology security 

program. The audit will assess compliance with FISMA and related information security policies, 

procedures, and practices. The scope of this audit includes general controls of the FMC network 

and applications housing service contracts, tariff location filings, and FMC license applications. 

The OIG will evaluate potential system vulnerabilities and assess management actions to 

implement prior-year recommendations. The final audit report will be issued by October 29, 2021. 

Hotline and Investigations

The Inspector General Act of 1978, as amended, provides that the IG may receive and 

investigate complaints or information concerning possible allegations of fraud, waste, and abuse 

occurring within FMC programs and operations by employees or contractors. Matters of possible 

wrongdoing are referred to the OIG in the form of allegations or complaints from a variety of 

sources, including FMC employees, other government agencies and the public. 

One hotline complaint was closed during the reporting period and four hotline complaints 

remained open at the end of this reporting period. There were no new hotline complaints received 

during this period and no open investigations or matters referred to prosecutorial authorities during 

this period. 

Memorandum of Understanding

In accordance with Section 6 of the Inspector General Reform Act of 2008, each Inspector 

General shall have his or her own legal counsel, or obtain the services of a counsel appointed by 

and directly reporting to another Inspector General or the Council of the Inspectors General on 

Integrity and Efficiency (CIGIE) on a reimbursable basis. The OIG has a memorandum of 
5 

understanding (MOU) with the Treasury Inspector General for Tax Administration for the FMC 

OIG to obtain legal advice services to carry out its responsibilities under the Inspector General 

Act. 

Review of Legislation

As required by the Inspector General Act of 1978, as amended, the OIG routinely reviews 

proposed legislation and regulations. The purpose of these reviews is to assess whether the 

proposed legislation or regulation: (1) impacts the economy and efficiency of FMC programs and 

operations; and (2) contains adequate internal controls to prevent and detect fraud, waste, and 

abuse. 

Council of the Inspectors General on Integrity and Efficiency (CIGIE) Activities

The CIGIE was established by law as an independent entity by the Inspector General 

Reform Act of 2008 (P.L. 110-409) to: 

• address integrity, economy and effectiveness issues that transcend individual government 

agencies; and 

• increase the professionalism and effectiveness of personnel by developing policies, 

standards, and approaches to aid in the establishment of a well-trained and highly skilled 

workforce in the Offices of Inspectors General. 

The CIGIE is comprised of all inspectors general that are Presidentially-appointed / Senate 

confirmed and those that are appointed by agency heads. The FMC OIG remains active in CIGIE 

operations. Specifically, the OIG is a member of CIGIE, participates in the monthly CIGIE 

meetings, and periodically assists CIGIE on special projects. 

The IG continues to serve in the position of Chair of the CIGIE Audit Peer Review 

Subcommittee. To help auditors fulfill their oversight roles and comply with statutory 

requirements, professional standards, and established policies and procedures, a peer review of an 

OIG audit organization is required by generally accepted government auditing standards (GAGAS) 

and the CIGIE. The subcommittee is responsible for maintaining the CIGIE audit peer review 

schedule, managing requests for extensions and substitutions, coordinating amongst dispute 
6 

resolution panels, as well as answering questions about conducting audit peer reviews. The 

subcommittee is composed of dedicated volunteers from the CIGIE oversight community. Parker 

Skaats, the OIG’s Auditor, is one of these dedicated volunteers and he serves on the 

subcommittee’s frequently asked questions workgroup. 
7 

SUMMARY OF INSPECTOR GENERAL REPORTING REQUIREMENTS

IG Act Reference Reporting Requirement Pages

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

Section 5(a)(2) Recommendations with respect to significant problems, 

abuses, or deficiencies

None

Section 5(a)(3) Prior recommendations on which corrective actions have not 

been completed

8

Section 5(a)(4) Matters referred to prosecutorial authorities and results None

Section 5(a)(5) Summary of instances where information was refused None

Section 5(a)(6) List of audit, inspection, and evaluation reports by subject 

matter, and where applicable, the value of questioned costs, 

unsupported costs, and funds put to better use

None

Section 5(a)(7) Summary of each report 2-3

Section 5(a)(8) Audit, inspection, and evaluation reports with questioned 

and unsupported costs

None

Section 5(a)(9) Audit, inspection, and evaluation report recommendations 

that funds be put to better use

None

Section 5(a)(10) Summary of each audit, inspection, and evaluation report

issued before the commencement of this reporting period for 

which no management decision was made by the end of the 

reporting period; for which comments were not returned 

within 60 days of report issuance; and for which there are 

any outstanding unimplemented recommendations

None

Section 5(a)(11) Description and explanation of significant revised 

management decisions

None

Section 5(a)(12) Significant management decisions with which the inspector 

general disagrees

None

Section 5(a)(13) Information under Section 804(b) of the Federal Financial 

Management Improvement Act (FFMIA) of 1996

None

Section 5(a)(14)(15) Peer review activity on FMC OIG 11, App. A

Section 5(a)(16) Peer review activity by FMC OIG on another OIG 11, App. A

Section 5(a)(17) Statistical tables on investigative activities None

Section 5(a)(18) Description of metrics used for developing the data for the 

statistical table under Section 5(a)(17)

None

Section 5(a)(19) Report on each investigation involving a senior Government 

employee where allegations of misconduct were 

substantiated

None

Section 5(a)(20) Description of whistleblower retaliation None

Section 5(a)(21) Description of any attempt by the establishment to interfere 

with the independence of the OIG

None

Section 5(a)(22) Description of particular circumstances of each inspection, 

evaluation, and audit conducted that is closed and was not 

disclosed to the public; and investigation conducted by the 

OIG involving a senior Government employee that is closed 

and was not disclosed to the public

None
8 

TABLE I - Summary of Reports with Corrective Actions Outstanding for More 

than 6 Months

Recommendations

Report Title Report 

Number

Issue 

Date Number Open Closed

Evaluation of the FMC’s 

Information Technology 

Inventory

A18-04 5/31/18 4 1 * 3 

* In September 2021, the OIG completed a follow-up review to determine whether FMC 

management implemented the OIG’s recommendations from the 2018 evaluation. The 

results of the OIG’s follow-up review determined that the Office of Information Technology 

(OIT) implemented three of the four OIG recommendations. One recommendation remains 

open related to the development of a new computer inventory policy and agency 

management anticipates approval of the new policy by the 1st quarter of fiscal year 2022. 

DATA Act Audit, 2019 A20-01 11/7/19 3 3 * 0 

* In a memorandum dated October 20, 2021, the Managing Director informed the IG that 

the agency considers the recommendations closed and awaits the results of the OIG’s 2021 

DATA Act audit. The OIG anticipates completion of the DATA Act audit in early 

November 2021. 

Audit of the FMC’s 

Compliance with the Federal 

Information Security 

Modernization Act (FISMA)

A21-02 10/30/20 2 1 * 1 

* Results from the OIG’s Fiscal Year 2021 Audit of the FMC’s Compliance with the Federal 

Information Security Modernization Act (FISMA) determined the FMC resolved one of the 

two prior year audit recommendations and made progress towards implementing the other 

audit recommendation.

TABLE II - Listing of Reports Issued

Report Title Assignment 

Number

Issue 

Date 

Questioned 

Costs

Unsupported 

Costs

Funds 

Put to 

Better 

Use

N/A N/A N/A $0 $0 $0
9 

TABLE III - Reports with Questioned Costs

Number

of 

Reports

Questioned 

Costs

Unsupported 

Costs

A. For which no management decision has been 

made by the commencement of the reporting 

period. 

0 $0 $0

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

Subtotal (A + B) 0 $0 $0

C. For which a management decision was made 

during the reporting period. 

0 $0 $0

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

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

D. For which no management decision has been 

made by the end of the reporting period. 

0 $0 $0

E. Reports for which no management decision 

was made within six months of issuance. 

0 $0 $0
10 

TABLE IV - Recommendations that Funds be Put to Better Use

Number

of 

Reports Dollar Value

A. For which no management decision has been made 

by the commencement of the reporting period. 0 $0 

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

Subtotal (A + B) 0 $0

C. For which a management decision was made during 

the reporting period. 0 $0 

(i) dollar value of recommendations that were 

agreed to by management; and 

0 $0

(ii) dollar value of recommendations that were not 

agreed to by management. 

0 $0

D. For which no management decision has been made 

by the end of the reporting period. 0 $0 

E. Reports for which no management decision was 

made within six months of issuance. 0 $0 
11 

Appendix A - Peer Review Activity

In accordance with the Dodd-Frank Wall Street Reform and Consumer Protection Act of 

2010 (Section 989C of P.L. 111-203), which amended Section 5 of the Inspector General Act of 

1978, OIGs are required to include in their semiannual reports (SAR) to Congress the results of 

peer reviews of their offices, as well as outstanding and not fully implemented recommendations 

from peer reviews the OIG received from another OIG, and outstanding and not fully implemented 

recommendations the OIG made in any peer review it performed for another OIG.

An external audit peer review of the FMC OIG audit office was completed on May 23, 

2019 by the U.S. Equal Employment Opportunity Commission OIG. A pass rating was issued and 

there were no recommendations contained in the system review report. 

In addition, the OIG completed an audit peer review of the Architect of the Capitol OIG

during this reporting period and issued the peer review report on September 1, 2021. The FMC 

OIG issued a pass rating and there were no recommendations contained in the system review 

report. 
12 

HOTLINE COMPLAINTS 

The success of the OIG mission to prevent fraud, waste and abuse 

depends on the cooperation of FMC employees and the public. 

Employees and the public are encouraged to contact the OIG regarding 

any incidents of possible waste, fraud or abuse occurring within FMC 

programs and operations.

A COMPLAINT CAN BE REPORTED BY CALLING OUR 24-HR DIRECT LINE: 

(202) 523-5865

ONLINE COMPLAINT FORM: 

https://www2.fmc.gov/oigcomplaints/

TO PLACE A COMPLAINT IN WRITING PLEASE MAIL TO: 

Federal Maritime Commission

Office of Inspector General

Suite 1054

800 North Capitol Street, NW

Washington, DC 20573

To Be Opened By the IG Only

THE INFORMATION YOU PROVIDE IS CONFIDENTIAL. YOU CAN CHOOSE TO REMAIN 

ANONYMOUS; HOWEVER, INDIVIDUALS ARE ENCOURAGED TO ASSIST THE INSPECTOR 

GENERAL BY SUPPLYING INFORMATION AS TO HOW THEY MAY BE CONTACTED FOR 

ADDITIONAL INFORMATION.