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From Daily Caller: Swindlers in the defense industrial complex have ripped off the Pentagon to the tune of billions of dollars in recent years, but that figure may just be scratching the surface, according to a Government Accountability Agency (GAO) report published Wednesday.
The report revealed that the Department of Defense (DOD) had been defrauded of nearly $11 billion between fiscal years 2017 and 2024, while noting that the confirmed amount reflects “only a small fraction of DOD’s potential fraud exposure.” The GAO published the report in conjunction with testimony from the Director of Forensic Audits and Investigative Service Seto Bagoyen before the House Oversight Committee on Wednesday.
One example of fraud cited in the report included a contractor using U.S.-based shell companies that delivered faulty components for use in F-15 fighter jets. The fraudulent contract led to the grounding of 47 F-15s for safety reasons.
Another instance cited involved a DOD contractor who conspired with a child company to illegally jack up prices for parts, which ultimately cost the Pentagon $48 million, according to the report. The GAO also noted in its assessment that the DOD has been slow in implementing its recommendations to reduce fraud in its contracting system over the last seven years.
In another case, two DOD contracting firms misled the Pentagon about their respective ownership to bid for contracts that they should not have been eligible for, a scheme that defrauded the federal government of $200 million, according to the GAO report.
The GAO report points out that fraud can have a significant t effect on the DOD’s $1 trillion in annual spending, calling even a small percentage “a significant diversion of resources from its warfighting mission,” putting that mission in danger.
“Unfortunately the fraudsters are ahead of us in multiple agencies, programs and so on,” Bagoyen said.
“The two most common schemes we flagged are false claims and overcharging, there’s a whole slew of others,” he continued. “Whatever analytics the DOD implements will have to be very tactically focused.”
PENTAGON FRAUD | Military spending is under intense scrutiny on Capitol Hill as reports reveal billions in confirmed fraud within the Department of Defense (DOD). https://t.co/LcSL1eDuWl pic.twitter.com/ZfmDU6avLr
— News 4 San Antonio (@News4SA) June 5, 2025
DoD failed for the fourth straight year to comply w the Payment Integrity Information Act (PIIA), which requires federal agencies to manage and report improper payments. How many is 1,080 millions in improper payments? 400 million in unknown? That’s a lot. Interesting part on… pic.twitter.com/AHdc2dDupQ
— Eric CIAramella’s Dirty Whistle (@TheAndersPaul) June 2, 2025
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