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TITLE VIII--ACQUISITION POLICY, ACQUISITION MANAGEMENT, AND RELATED MATTERS

House Conference Report 109-360

SEC. 841. REVIEW AND REPORT ON DEPARTMENT OF DEFENSE EFFORTS TO IDENTIFY CONTRACT FRAUD, WASTE, AND ABUSE.

(a) Review by Comptroller General- The Comptroller General shall conduct a review of efforts by the Department of Defense to identify and assess the areas of vulnerability of Department of Defense contracts to fraud, waste, and abuse.

(b) Matters Covered-

(1) IN GENERAL- In conducting the review, the Comptroller General shall summarize the ongoing efforts of the Department of Defense, including the reviews described in paragraph (2), and make recommendations about areas not addressed or items that need further investigation.

(2) DEPARTMENT OF DEFENSE REVIEWS- The reviews by the Department of Defense referred to in paragraph (1) are the following:

(A) A report by a task force of the Defense Science Board dated March 2005 and titled `Management Oversight in Acquisition Organizations'.

(B) An audit by the Inspector General of the Department of Defense titled `Service Acquisition Executives Management Oversight and Procurement Authority'.

(C) A task force to address contract fraud, waste, and abuse designated by the Deputy Secretary of Defense.

(c) Report- Not later than 180 days after the date of the enactment of this Act, the Comptroller General shall submit to the Committees on Armed Services of the Senate and the House of Representatives a report on the results of the review, including the Comptroller General's findings and recommendations.

The Senate amendment contained a provision (sec. 823) that would establish a risk assessment team to assess the vulnerability of Department of Defense contracts to fraud, waste, and abuse and require the Secretary of Defense to develop an action plan to address areas of vulnerability identified by the risk assessment team.

The House bill contained no similar provision.

The House recedes with an amendment that would require the Government Accountability Office to review ongoing efforts by the Department to identify and assess the areas of vulnerability to contract fraud, waste, and abuse.

Senate Report 109-69

The committee recommends a provision that would establish a risk assessment team to assess the vulnerability of Department of Defense contracts to fraud, waste, and abuse and require the Secretary of Defense to develop an action plan to address areas of vulnerability identified by the risk assessment team.

Recent contracting scandals in the Department of Defense have lead the U.S. Attorney for the Eastern District of Virginia to establish a Procurement Fraud Working Group to promote early detection and prevention of procurement fraud through the use of law enforcement measures to increase prevention and prosecution of fraud-related cases. The committee strongly supports this effort. However, the committee believes that more proactive measures can be taken by the Department to prevent fraud. A combined approach of active prosecution and proactive Department policies and procedures directed at areas of potential vulnerability should be constructive in deterring improper contracting practices.