Snap Fact #139

In 2009, as much as $110 billion in improper payments were made to individuals, contractors, and organizations by the United States government. This type of fraud contributes significantly to the deficit in the federal budget, wasting citizens’ tax money. 

As a result, on June 18, 2010, with his typical laser focus and insight, the President acted to prevent inefficient and irresponsible spending in Washington. President Obama ordered all federal agencies to create a joint shareable “Do Not Pay” list as a single source where the agencies can access accurate information to assess the value and trustworthiness of individuals and companies that potentially can be contracted by the government. 

For example, the President's list includes the Social Security Administration's Death Master File. This file identifies deceased individuals so that no fraudulent payment will be made to any dead person. Another example is the General Service Administration’s Excluded Parties List System which identifies suspended and unreliable contractors. 

While identifying and recapturing improper payments is important, prevention of payment errors before they occur should be the first priority in protecting taxpayer resources from waste, fraud, and abuse. In those cases where data is made available to agencies that clearly shows that a potential recipient of a Federal payment is ineligible for it, subsequent payment to that recipient is deemed unacceptable. "We must ensure that such payments are not made,” said President Obama upon ordering the creation of the list.