The U.S. Department of the Treasury has announced that its new technology-focused efforts have helped prevent and recover more than $4 billion from fraud and improper payments during the fiscal year 2024, a huge increase from $652.7 million in 2023.
This success is the product of hard work by the Office of Payment Integrity, which is part of the Treasury’s Bureau of the Fiscal Service. The office has improved its ability to detect and prevent fraud, helping both new and current clients.
The Treasury was able to prevent $500 million in fraud by expanding its risk-based screening methods. The department also focused on high-risk transactions, resulting in stopping $2.5 billion from being lost to fraud. As the federal government’s main agency for payments, the Treasury processes about 1.4 billion payments every year, totaling over $6.9 trillion.
The agency said that by using machine learning, a form of artificial intelligence, it sped up how quickly it could identify fraud in Treasury checks, helping recover $1 billion. Further improvements in the payment process also prevented another $180 million in fraud.
Deputy Secretary of the Treasury Wally Adeyemo stated that protecting taxpayer money is a top priority, stressing the importance of ensuring that payments are made to the right people, in the correct amount, and on time.
Adeyemo praised the significant progress made in fighting fraud and improper payments over the past year. He expressed the Treasury’s commitment to continuing to work with other government agencies to provide them with the tools, data, and expertise needed to stop fraud and improper payments.
Along with better fraud detection tools, the Treasury is also working on forming stronger partnerships, especially with programs considered high-risk. An example of this is a partnership with the Department of Labor, announced in May 2024, which provides state unemployment agencies with better access to data to help them detect fraud.
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In 2023, people in the U.S. lost a total of $10 billion to fraud, which is 14% more than the previous year. This information comes from the Federal Trade Commission (FTC) and is based on around 2.6 million fraud reports from consumers.
Investment scams accounted for the largest losses, totaling over $4.6 billion. Imposter scams, reported most frequently, resulted in nearly $2.7 billion in losses.
Globally, scams led to nearly $486 billion in losses in 2023, according to a report by Nasdaq. Of this, about $151.1 billion occurred in the Americas. The FTC noted that the number of fraud reports remained high, similar to the previous year, indicating that fraudulent activities continue to be a significant issue across various sectors.
The rise in fraud highlights the increased importance of scam awareness and the need for stronger regulations. While understanding current fraud schemes is crucial, new technology aids in catching scammers but also equips them with tools to create even more advanced scams.
