They say there are three topics to avoid in a business setting: religion, personal issues and politics. I am going to preface this article with a large disclaimer. The intent of this article is not to discuss the validity of the Department of Government Efficiency (DOGE) or how best to address the potential waste, fraud and abuse in the federal government.
The intent of this article is to assess DOGE’s claims of widespread fraud based on my experience and expertise as a Certified Fraud Examiner (CFE).
The Origin of DOGE
According to a 2024 report by the U.S. Government Accountability Office (GAO), the federal government could lose between $233 billion to $521 billion annually due to fraud. The problem of fraud is certainly an important one and should be addressed by our government.
The Department of Government Efficiency was created through Executive Order by President Trump on January 20, 2025. While there is some confusion as to who is actually the administrator of DOGE, it is clear that Elon Musk is serving as the public face of the department.
DOGE’s “Wall of Receipts”
In an effort to combat “waste, fraud, and abuse,” DOGE staffers with unknown qualifications have been turned loose on the federal government. Mr. Musk has promised “maximum transparency,” and that includes a “wall of receipts” posted on the DOGE website. As of this writing, the website claims total estimated savings of $65 billion, “which is a combination of fraud detection/deletion, contract/lease cancellations, contract/lease renegotiations, asset sales, grant cancellations, workforce reductions, programmatic changes, and regulatory savings.”
It should be noted that the wall of receipts represents only a small portion of the overall estimated savings claimed by DOGE. In addition, as others have identified, there are significant errors on the website. Some of the contracts were double or triple counted. Another cancelled contract initially was listed at $8 billion instead of $8 million. And other contracts are counted as cancelled when the contract expired or the contract had not yet been awarded.
DOGE’s Early Claims of Fraud
Mr. Musk also posted numerous times on X claiming that DOGE has uncovered fraud. He claimed that DOGE discovered what “might be the biggest fraud in history” within the Social Security Administration (SSA) related to payments to millions of people over the age of 100. He also asserted that non-existent people, or the identities of dead people, are being used to collect federal paychecks. How is the public to respond to these claims of fraud?
Certainly, rooting out fraud at the SSA and cleaning up the program’s databases are worthwhile pursuits, but does the limited work that DOGE has done so far signal fraud? And if fraud has not yet been found, what purpose does it serve, either politically to President Trump or personally to Mr. Musk, to make these claims?
Let’s Define Fraud
It might be helpful to first define “fraud.” Dictionary.com defines fraud as “deceit, trickery, sharp practice, or breach of confidence, perpetrated for profit or to gain some unfair or dishonest advantage.” According to the Corporate Fraud Handbook, “in the broadest sense, fraud can encompass any crime for gain that uses deception as its principal modus operandi.”
Is DOGE Really Finding Fraud?
Based on what’s been presented so far, has DOGE found actual fraud? As a Certified Fraud Examiner, it would be hard to come to that conclusion.
First, a fraud examiner is a gatherer of evidence, not the ultimate judge of the evidence. Generally, opinions in fraud examination matters are avoided. Ultimately, it’s expected that any suspected fraud would be turned over to the Justice Department for criminal prosecution.
Second, fraud examinations usually follow the fraud theory approach, which involves the following steps:
- Analyze available data
- Create a hypothesis
- Test the hypothesis
- Refine and amend the hypothesis
Using Mr. Musk’s claim of fraud related to the SSA, it’s possible that DOGE analyzed certain available data and created a hypothesis that millions of people over 100 years old are receiving benefit payments. But that hypothesis would need to be tested.
Interestingly, the information that was uncovered by DOGE had previously been identified in a July 2023 report by the Social Security Administration’s inspector general. In that report, approximately 18.9 million individuals born in 1920 or earlier did not have death information in the SSA’s database. The report went on to indicate that almost none of the 18.9 million individuals were receiving SSA payments (the report indicated that approximately 44,000 people were receiving payments, a number that is less than the estimated number of centenarians in the United States).
The crucial question is not whether these individuals in SSA’s database are missing “death information,” but whether they are still receiving benefit payments. Forensic analysis could certainly be utilized to determine if these millions of people are receiving payments, but that information has not been shared with the public. If these millions of people are not receiving payments, it’s an indication that the department’s internal controls to ensure proper payments are working as they were designed.
Another interesting point in the inspector general’s July 2023 report is that the SSA determined it would cost between $5.5 to $9.7 million to correct the database errors. This was deemed too costly to implement and would have limited benefit to the administration of SSA programs. Isn’t that the correct cost/benefit analysis that should have been done to see if the program was operating efficiently?
Similarly, what analysis has been done to test Mr. Musk’s claim that non-existent people or the identities of dead people are being used to collect federal paychecks? While it’s certainly possible that some instances of fraud can be found, is this a systemic problem or is it purely political maneuvering to cast dispersions on our federal workforce?
It’s also important to note that DOGE is just over a month old. As someone with over 25 years of experience as an auditor, I find it highly suspect that any comprehensive “audits” have been done on any of the agencies in question. A typical agency audit by the GAO is an extensive process that involves collecting and gathering evidence, reviewing the findings and writing a comprehensive report. The entire process might take six to nine months and all the findings in the report would be linked to evidence that has been collected. Instead, DOGE has moved with the speed normally found in Silicon Valley — and that speed has created errors. Those errors can have minimal impacts in a private company, but they can result in real-life consequences to millions of people when dealing with the federal government.
Speaker Mike Johnson recently stated, “Elon has cracked the code. He’s now inside these agencies. He’s created these algorithms that are constantly crawling through the data and as he told me in his office, the data doesn’t lie.” With all due respect to Speaker Johnson, data can certainly lie. Data can be manipulated. Data doesn’t always show the full story. As a CFE, the important question is whether the data showing fraud can then be tested and verified.
In addition to their vocal claims about fraud, President Trump and Elon Musk recently discussed auditing the gold at Fort Knox. As any auditor will tell you, an audit of the volume of inventory at Fort Knox is not something that can be accomplished in an afternoon. So, the important questions related to this “audit” are: Who will be conducting this audit? What is their training? What are their qualifications? What assurances does the American public have that an audit is done properly? And why is this necessary if the Treasury Secretary says that an audit is done on Fort Knox every year and that “all of the gold is present and accounted for”?
Impact On True Fraud Investigations
As a Certified Fraud Examiner, I have serious questions about how DOGE is going about its operations and the damage it is doing to the public’s perception of fraud investigations.
As someone who has conducted multiple fraud investigations over the past 15 years, I am concerned that this is leading to an expectation that a fraud investigation can be conducted in a matter of hours through some algorithm, rather than through detailed analysis.
Need Help Uncovering Fraud?
Our Certified Fraud Examiners can help your organization put measures into place to prevent fraud, and help you investigate if you suspect fraud has occurred.
Contact us online or call 800.899.4623.
