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WASTE, FRAUD COST BILLIONS OF TAX DOLLARS, LIST SHOWS

SHARE WASTE, FRAUD COST BILLIONS OF TAX DOLLARS, LIST SHOWS

Top managers of federal agencies believe tens of billions of tax dollars are jeopardized by waste, fraud and shoddy practices, according to an inventory of "high-risk programs" compiled by the Office of Management and Budget.

The list is a department-by-department blueprint of costly flaws in the way the federal government conducts the people's business. It was made public this week by Sen. John Glenn, D-Ohio, chairman of the Senate Governmental Affairs Committee.He noted that warnings about the Department of Housing and Urban Development went unheeded until flaws grew into an estimated $6 billion crisis and praised budget director Richard Darman for trying to identify "programs which could become our next HUDs."

"He's really bringing some of these things to light . . . so that we'll know if there are any more of those HUD situations out there," Glenn said.

OMB confirmed it gave the list to Glenn. Spokeswoman Barbara Clay said the administration plans to work closely with Glenn to develop "management systems and internal controls sufficient to deal with the high risks identified on the list."

The list detailed problems with more than 70 programs. Among them:

-The Department of Defense pays for goods it doesn't receive and can't account for, or adequately trace, $56.5 billion worth of government property that's in the hands of government contractors.

-There's a $58.5 billion difference between the amount of money the Social Security Administration records say has been received from workers and the amount indicated by Internal Revenue Service records.

-At the Patent and Trademark Office, 1.89 million documents are missing or misfiled.

Glenn has been holding a series of hearings on government efficiency.

The General Accounting Office, Congress' investigative arm, told Glenn's committee last month that "inadequate financial controls" resulted in the loss of $4 billion at the Department of Veterans Affairs, more than $10 billion in military sales and loans to foreign governments and $12 billion dollars at the Commodity Credit Corp.

"All of the major agencies have serious problems," Comptroller General Charles Boucher told the committee. "Unfortunately, time and time again we find situations where agencies and auditors have identified problems, yet the corrective actions taken, if any, are ineffective and the problems remain uncorrected for years."

In October, Darman told the committee the list of risky areas was being put together with the intention of devoting "significant attention to correcting these vulnerabilities over time."

"I have instructed OMB budget staff to give priority to providing resources to needed corrections," Darman testified.

He also said the problems encountered at HUD "are not unique."

Darman said he asked federal managers to report weaknesses that might lead to waste and fraud, and their reports showed "HUD wasn't the worst. It was in the middle of the pack, which leads one to worry about any number of other big problems out there."

The 27-page list covers the well-publicized problems at HUD and at the Energy Department's nuclear plants and highlights numerous others.

The list criticizes the financial controls set up for the Superfund environmental cleanup program. The Environmental Protection Agency doesn't log some "accounts receivable" until payments come in, and the EPA's inspector general found $8 million of such accounts in one regional office, the report said.

The Treasury Department reported the IRS has failed to collect more than $63 billion worth of delinquent taxes.

The list also noted Department of Veterans Affairs compensation and pension programs have made $53 million in overpayments. Benefit decisions "have not always been appropriate or correct," the document said.