Treasury OIG: Semiannual Report to Congress, October 1, 2020 – March 31, 2021 (OIG-CA-21-019)
Summary
The Department of the Treasury Office of Inspector General's Semiannual Report to Congress OIG-CA-21-019 covers October 1, 2020 through March 31, 2021. It states that the Office of Audit issued 42 products and that work by the Office of Investigations resulted in 3 indictments and 15 convictions. The highlights report a letter to the Iowa Department of Management finding that using Coronavirus Relief Fund proceeds for payments related to a portion of a $20.1 million contract with Workday, Inc. was not a reasonable, allowable use of funds. The message from Acting Inspector General Richard K. Delmar lists programs overseen by the office, including the $150 billion Coronavirus Relief Fund and $350 billion State and Local Fiscal Recovery Funds.
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“Treasury OIG: Semiannual Report to Congress, October 1, 2020 – March 31, 2021 (OIG-CA-21-019).”
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Semiannual Report to Congress
October 1, 2020 – March 31, 2021
OIG-CA-21-019
Office of Inspector General
Department of the Treasury
Highlights
During this semiannual reporting period, the Office of Audit issued 42 products. Work by
the Office of Investigations resulted in 3 indictments and 15 convictions. Some of our
more significant results for the period are described below:
• We issued a letter to the Director of the Iowa Department of Management
concerning the State’s use of the Coronavirus Relief Fund (CRF) to make payments
related to a portion of a $20.1 million contract with Workday, Inc. (Workday), to
implement a computer system for accounting and human resources that will replace
the State’s legacy mainframe systems. We determined that funding the Workday
contract with CRF proceeds was not a reasonable, allowable use of funds related to
addressing the Coronavirus Disease 2019 (COVID-19) health pandemic. In response
to our letter, the State Governor authorized the return to Iowa’s CRF of all amounts
that were initially allocated for payments on the Workday contract.
• We identified pervasive issues with the calculation of payroll amounts reported to the
Department of the Treasury (Treasury or the Department) by non-241 passenger air
carriers [carriers that do not report financial data to the Department of
Transportation] and contractors in their applications for Payroll Support Program
(PSP) funds. These payroll amounts impacted the accuracy of recipient award
amounts. We notified Treasury of these matters in December 2020, and according to
management, Treasury implemented a number of measures in its “Payroll Support
Program Extension” application process to identify and correct PSP award amounts.
• We conducted an investigation based on information from an airline industry business
that received funds under the Coronavirus Aid, Relief, and Economic Security Act
(CARES Act). The business self-reported some of their employees were
underreporting hours worked and filing unemployment claims in Louisiana, in order to
qualify for enhanced unemployment benefits under the CARES Act. Criminal
prosecution of the employees was presented and declined by the U.S. Attorney’s
Office (USAO) of Louisiana.
• We conducted an investigation based on a notification from the Bureau of the Fiscal
Service that a subject received more than 20 years of retirement payments totaling
$320,292 after the death of the authorized annuitant. Criminal prosecution of the
subject was presented and declined by the USAO of Maryland.
• An agent in our Office of Investigations participated as a member of a U.S. Marshals’
Task Force, ensuring the continued safety of vulnerable children.
Treasury Office of Inspector General Semiannual Report—March 2021 i
Message from the Acting Inspector General
During this reporting period, the Department of the Treasury (Treasury or the
Department) Office of Inspector General’s (OIG) oversight expanded significantly to
include new programs and additional funding for existing programs established to
provide economic relief in response to the ongoing Coronavirus Disease 2019
(COVID-19) pandemic. In 2020 and 2021, OIG added four audit directorates to carry
out oversight responsibilities assigned to us under the Coronavirus Aid, Relief, and
Economic Security Act (CARES Act) enacted on March 27, 2020; the 2021
Consolidated Appropriations Act enacted on December 27, 2020; and the American
Rescue Plan enacted on March 11, 2021.
Pandemic programs overseen by OIG include the $150 billion Coronavirus Relief Fund,
$350 billion State and Local Fiscal Recovery Funds, $62 billion Air Carrier Payroll
Support Programs, $47 billion Emergency Rental Assistance Programs, $10 billion
Homeowner Assistance Fund, $10 billion State Small Business Credit Initiative,
$9 billion Emergency Capital Investment Program, $3 billion Community Development
Financial Institutions (CDFI) Fund, and $2 billion Coronavirus Economic Relief for
Transportation Services Program. Our office is actively engaged with Treasury
regarding the implementation of new relief programs and our oversight role.
The magnitude of the pandemic appropriations under Treasury’s responsibility, and the
speed with which funding needs to be disbursed to those in need, only serves to
increase the importance of OIG’s oversight role to ensure that fraud, waste, and abuse
are prevented and detected and that there is transparency around government
pandemic spending. In this effort, we work closely with the Council of the Inspectors
General on Integrity and Efficiency’s Pandemic Response Accountability Committee to
ensure transparency and accountability of COVID-19 spending.
While much has changed since the beginning of the Pandemic, Treasury OIG remains
steadfast in our efforts to ensure that our oversight of Treasury’s operations,
programs, and personnel provides value-driven data, insight, and recommendations
that assist the Department in meeting its management goals and objectives. I’m
honored to work with these impressive professionals, whose quantity and quality of
work serves the Department, and the country, so well.
Richard K. Delmar
Acting Inspector General
Treasury Office of Inspector General Semiannual Report—March 2021 ii
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Contents
Highlights ......................................................................................... i
Message from the Acting Inspector General .......................................... ii
Treasury Office of Inspector General Overview .................................... 1
Management and Performance Challenges ........................................... 5
Office of Audit – Significant Audits and Other Products ........................ 7
Financial Management ............................................................................................ 7
CARES Act Oversight ........................................................................................... 11
CARES Act Compliance Monitoring ........................................................................ 13
Cyber/Information Technology ............................................................................... 14
Office of Investigations – Significant Investigations ............................ 17
CARES Act Investigation ....................................................................................... 17
Other Significant Investigations .............................................................................. 17
Treasury OIG Accomplishments and Activities ................................... 19
Statistical Summary ........................................................................ 21
Summary of Treasury OIG Activities ....................................................................... 21
Reports with Unimplemented Recommendations ...................................................... 22
Closed Investigations of Senior Government Employees Not Publicly Disclosed ............ 42
Summary of Instances of Whistleblower Retaliation .................................................. 43
Summary of Attempts to Interfere With Treasury OIG Independence, Including Instances
Where Information or Assistance Request was Refused............................................. 43
Listing of Audit Products Issued ............................................................................. 44
Audit Reports Issued With Questioned Costs ........................................................... 49
Audit Reports Issued With Recommendations that Funds Be Put to Better Use ............. 50
Reports for Which No Management Comment was Returned Within 60 Days ............... 51
Reports Issued Over 6 Months for Which No Management Decision Has Been Made ..... 51
Significant Revised Management Decisions .............................................................. 51
Significant Disagreed Management Decisions ........................................................... 51
Peer Reviews ....................................................................................................... 52
Other Reporting Requirements and Requests ............................................................ 53
Treasury Office of Inspector General Semiannual Report—March 2021 iv
Contents
References to the Inspector General Act............................................ 55
Abbreviations ................................................................................. 57
Treasury Office of Inspector General Semiannual Report—March 2021 v
Treasury Office of Inspector General Overview
The Department of the Treasury’s (Treasury or the Department) Office of Inspector
General (OIG) was established pursuant to the 1988 amendments to the Inspector
General Act of 1978. Treasury OIG is headed by an Inspector General appointed by
the President with the advice and consent of the Senate.
Treasury OIG performs independent, objective reviews of Treasury programs and
operations, except for those of the Internal Revenue Service (IRS), the Troubled Asset
Relief Program (TARP), and certain pandemic-related loans, loan guarantees, and other
investments, and keeps the Secretary of the Treasury and Congress fully informed of
problems, deficiencies, and the need for corrective action. The Treasury Inspector
General for Tax Administration (TIGTA) and the Government Accountability Office
(GAO) perform oversight related to IRS. A Special Inspector General and GAO perform
oversight related to TARP. The Special Inspector General for Pandemic Recovery
performs oversight of loans, loan guarantees, and other investments under the
Coronavirus Economic Stabilization Act of 2020.
Treasury OIG also performs independent oversight of programs and operations funded
by the Gulf Coast Restoration Trust Fund (Trust Fund) established within Treasury by
the Resources and Ecosystems Sustainability, Tourist Opportunities, and Revived
Economies of the Gulf Coast States Act of 2012 (RESTORE Act). In addition to
performing oversight of Treasury-related activities, Treasury OIG performs oversight of
programs and operations administered by the Gulf Coast Ecosystem Restoration
Council (Council), established as an independent Federal entity, and the Gulf Coast
Ecosystem Restoration Science, Observation, Monitoring, and Technology Program
(Science Program) administered by the National Oceanic and Atmospheric
Administration (NOAA). With regard to the Council and the Science Program, Treasury
OIG keeps the appointed Chairperson of the Council, the NOAA Science Program
Administrator, and Congress fully informed of problems, deficiencies, and the need for
corrective actions.
Treasury OIG has four components: (1) Office of Audit; (2) Office of Investigations;
(3) Office of Counsel; and (4) Office of Management. Treasury OIG is headquartered in
Washington, DC. Treasury OIG also has an audit office in Boston, Massachusetts.
The Office of Audit, under the leadership of the Assistant Inspector General for Audit,
performs and supervises financial and performance audits, attestation engagements,
and evaluations. The Assistant Inspector General for Audit also serves as the Special
Treasury Office of Inspector General Semiannual Report—March 2021 1
Treasury Office of Inspector General Overview
Deputy Inspector General for Small Business Lending Fund (SBLF) Program Oversight.
Under the Assistant Inspector General for Audit, there are three deputies. The first
deputy is primarily responsible for financial sector audits to include audits of banking
supervision, manufacturing of currency and coins, resource management,
procurement, alcohol and tobacco excise tax revenue collection activities, SBLF
programs, and the State Small Business Credit Initiative (SSBCI) authorized by the
American Rescue Plan. The second deputy is primarily responsible for financial
management and transparency audits to include financial audits of Treasury and the
Council performed by Treasury OIG staff and contractors, audits of Government-wide
collection, payment, and debt programs and operations, audits of anti-money
laundering/terrorist financing, foreign sanctions, and intelligence programs and
operations, and audits of Emergency Rental Assistance (ERA) and Homeowners
Assistance Fund (HAF) programs authorized by the Consolidated Appropriations Act,
2021 and the American Rescue Plan. The third deputy is primarily responsible for
cybersecurity and financial assistance audits to include audits of Treasury and the
Council information systems performed by Treasury OIG staff and contractors,
RESTORE Act programs and operations, the Coronavirus Relief Fund (CRF), and the
new State and Local Fiscal Recovery Fund authorized by the American Rescue Plan.
The Office of Investigations, under the leadership of the Assistant Inspector General
for Investigations, performs investigations and conducts initiatives to detect and
prevent fraud, waste, and abuse in programs and operations across Treasury OIG’s
jurisdictional boundaries, and investigates threats against Treasury personnel and
assets in designated circumstances as authorized by the Inspector General Act. The
Office of Investigations also manages the Treasury OIG Hotline to facilitate reporting
of allegations involving these programs and operations.
The Office of Counsel, under the leadership of the Counsel to the Inspector General,
provides legal advice to the Inspector General and all Treasury OIG components. The
office represents Treasury OIG in administrative legal proceedings and provides a
variety of legal services, including (1) processing Freedom of Information Act and
Giglio 1 requests; (2) conducting ethics training; (3) ensuring compliance with financial
disclosure requirements; (4) reviewing proposed legislation and regulations;
(5) reviewing administrative subpoena requests; and (6) preparing for the Inspector
General’s signature, cease and desist letters and monetary assessments against
persons and entities misusing the Treasury seal and name. The Office of Counsel also
1
Giglio information refers to material that may call into question the character or testimony of a
prosecution witness in a criminal trial.
Treasury Office of Inspector General Semiannual Report—March 2021 2
Treasury Office of Inspector General Overview
responds to media and Congressional inquiries and serves as the Whistleblower
Protection Coordinator for Treasury.
The Office of Management, under the leadership of the Assistant Inspector General for
Management, provides administrative services to maintain the Treasury OIG
administrative infrastructure, including facilities, human resources, information
technology, procurement, records management, and security.
Treasury OIG’s annual fiscal year 2021 appropriation is $41 million, including up to
$2.8 million of 2-year funding for the RESTORE Act programs. Treasury OIG’s
oversight of SSBCI and SBLF programs is funded on a reimbursable basis. In addition
to the annual fiscal year appropriation, Treasury OIG has received no-year funding of
$35 million for the CRF, $9.5 million for ERA, and $2.6 million for the HAF programs.
As of March 31, 2021, Treasury OIG had 188 full-time staff.
Treasury Office of Inspector General Semiannual Report—March 2021 3
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Management and Performance Challenges
The Reports Consolidation Act of 2000 requires that the Department of the Treasury
(Treasury or the Department) Inspector General annually provides information on the
most serious management and performance challenges facing Treasury and the Gulf
Coast Ecosystem Restoration Council (Council). The following is a synopsis of our
annual assessments which are available, in their entirety, on the Treasury Office of
Inspector General (OIG) website.
Treasury
In an October 29, 2020, memorandum to Secretary of the Treasury, Steven
Mnuchin, Deputy Inspector General Richard Delmar reported the following six
challenges facing the Department of which one is new.
• Coronavirus Disease 2019 (COVID-19) Pandemic Relief (New)
• Operating in an Uncertain Environment
• Cyber Threats
• Anti-Money Laundering/Terrorist Financing and Bank Secrecy Act
Enforcement
• Efforts to Promote Spending Transparency and To Prevent and Detect
Improper Payments
• Information Technology Acquisition and Project Management
Gulf Coast Ecosystem Restoration Council
In an October 7, 2020, letter to the Honorable Andrew Wheeler, Administrator
of the Environmental Protection Agency, as Chairperson of the Gulf Coast
Ecosystem Restoration Council, we reported three challenges, two of which are
repeat challenges and one that is a new challenge.
• Loss of Key Leadership Over Administration of Gulf Coast Restoration
Activities (New)
• Federal Statutory and Regulatory Compliance
• Grant and Interagency Agreement Compliance Monitoring
Treasury Office of Inspector General Semiannual Report—March 2021 5
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.
Office of Audit – Significant Audits and Other Products
Financial Management
Treasury’s Consolidated Financial Statements
KPMG LLP (KPMG), a certified independent public accounting firm working under a
contract with and supervised by our office, issued an unmodified opinion on the
Department of the Treasury’s (Treasury or the Department) fiscal years 2020 and
2019 consolidated financial statements. KPMG reported (1) a significant deficiency in
internal control over cash management information systems and a significant
deficiency in internal control over Federal debt information systems at the Bureau of
the Fiscal Service (Fiscal Service), collectively representing a significant deficiency for
Treasury as a whole, and (2) a significant deficiency in internal control over unpaid tax
assessments and a significant deficiency in internal control over financial reporting
systems at the Internal Revenue Service, collectively representing a significant
deficiency for Treasury as a whole. KPMG also reported that Treasury’s financial
management systems did not substantially comply with certain requirements of the
Federal Financial Management Improvement Act of 1996 (FFMIA) related to Federal
financial management systems requirements. KPMG found no other instances of
reportable noncompliance with laws, regulations, contracts, and grant agreements
tested. (OIG-21-019)
In connection with its audit of Treasury’s consolidated financial statements, KPMG
issued a management report, which provided the specific findings and
recommendations pertaining to the significant deficiency in internal control over cash
management information systems and the related noncompliance with FFMIA’s Federal
financial management systems requirements at Fiscal Service that were summarized in
the auditor’s report. (OIG-21-021) Additionally, KPMG issued a management letter
recommending improvements to strengthen internal control over financial reporting
with respect to program management implementation, frequency and evidence of
Financial Analysis and Reporting System backups, timeliness of control documentation
availability, untimely recording of the quarterly Government Sponsored Enterprises
liquidity preference increase, lack of appropriate review of Judgement Fund Internet
Claims System year-end accrual, and lack of documentation of review over Federal
Manager’s Financial Integrity Act compliance testing results; and incorrect compilation
on the Statement of Assurance Review Sheet. (OIG-21-020)
Treasury Office of Inspector General Semiannual Report—March 2021 7
Office of Audit – Significant Audits and Other Products
Other Treasury Financial Audits
The Chief Financial Officers Act of 1990, as amended by the Government
Management Reform Act of 1994, requires annual financial statement audits of
Treasury and any component entities designated by the Office of Management and
Budget (OMB). In this regard, OMB designated IRS for annual financial statement
audits. The financial statements of certain other Treasury component entities are
audited either pursuant to other requirements, their materiality to Treasury’s
consolidated financial statements, or as a management initiative. The table below
shows the audit results for fiscal years 2020 and 2019.
Treasury-audited financial statements and related audits
Fiscal year 2020 audit results Fiscal year 2019 audit results
Material Material
weak- Significant weak- Significant
Entity Opinion nesses deficiencies Opinion nesses deficiencies
Government Management Reform Act/Chief Financial Officers Act requirements
Department of the Treasury U 0 2 U 0 2
Internal Revenue Service (A) U 0 2 U 0 2
Other required audits
Office of Financial Stability
(TARP) (A) U 0 0 U 0 0
Bureau of Engraving and
Printing U 0 1 U 0 2
Community Development
Financial Institutions Fund U 0 0 U 0 0
Office of D.C. Pensions U 0 1 U 0 0
Federal Financing Bank U 0 0 U 0 0
Treasury Forfeiture Fund U 0 0 U 0 0
U.S. Mint
Financial Statements U 0 0 U 0 0
Custodial Gold and Silver
Reserves U 0 0 U 0 0
Other audited accounts/financial statements that are material to Treasury’s financial statements
Bureau of the Fiscal Service
Schedule of Federal Debt
(A) U 0 1 U 0 1
Exchange Stabilization Fund U 0 0 U 0 0
Management-initiated audits
Office of the Comptroller of
the Currency U 0 0 U 0 0
Alcohol and Tobacco Tax and
Trade Bureau U 0 0 U 0 0
U.S. Gold Reserves Held by
Federal Reserve Banks U 0 0 U 0 0
U Unmodified opinion and (A) Audited by the Government Accountability Office.
Treasury Office of Inspector General Semiannual Report—March 2021 8
Office of Audit – Significant Audits and Other Products
In connection with the fiscal year 2020 financial statement audits, the auditors issued
management letters on certain matters involving deficiencies in internal control at the
Community Development Financial Institutions Fund (OIG-21-007), the United States
Mint (OIG-21-012), the Office of D.C. Pensions (OIG-21-014), the Alcohol and
Tobacco Tax and Trade Bureau (OIG-21-017), and the Bureau of Engraving and
Printing (OIG-21-023).
Gulf Coast Ecosystem Restoration Council’s Financial Statements
The audit of the Gulf Coast Ecosystem Restoration Council’s (Council) financial
statements is also required by the Chief Financial Officers Act of 1990, as amended
by the Accountability of Tax Dollars Act of 2002. RMA Associates, LLC (RMA), a
certified independent public accounting firm working under a contract with and
supervised by our office, issued an unmodified opinion on the Council’s fiscal years
2020 and 2019 financial statements. RMA did not identify any matters involving
internal control and its operation that are considered material weaknesses.
Additionally, RMA did not identify any instances of reportable noncompliance with
laws, regulations, contracts, and grant agreements tested. (OIG-21-008)
Attestation Engagements
Independent certified public accounting firm, KPMG LLP (KPMG), under a contract
monitored by our office, completed the reports described below in support of the audit
of Treasury’s fiscal year 2020 consolidated financial statements and the financial
statement audits of certain other Federal agencies.
Reports on the Processing of Transactions by Fiscal Service
KPMG examined general computer investment and redemption processing, and
monitoring controls (systems) used for processing various Federal agencies’
transactions by Fiscal Service’s Federal Investments and Borrowings Branch,
and general computer trust funds management processing, and monitoring
controls (system) used for processing various Federal and State agencies’
transactions by the Fiscal Service’s Funds Management Branch for the period
beginning August 1, 2019, and ending July 31, 2020. KPMG found, in all
material respects, that the controls were fairly presented in the description of
controls for these activities and suitably designed. KPMG also found that
controls tested operated effectively throughout the period. (OIG-21-001,
OIG-21-002)
Treasury Office of Inspector General Semiannual Report—March 2021 9
Office of Audit – Significant Audits and Other Products
Federal Financial Management Improvement Act
The following instances of noncompliance with the Federal Financial Management
Improvement Act of 1996, were reported in connection with the audit of Treasury’s
fiscal year 2020 consolidated financial statements.
Type of
Condition noncompliance
Treasury continues to have deficiencies in IRS financial management systems. Federal financial
Specifically, IRS did not consistently design, implement, and operate information system management system
controls and security programs over its financial management systems in accordance requirements
with the Federal financial management systems requirements. (First reported in fiscal
year 1997)
Treasury has deficiencies in Fiscal Service Government-wide cash and Federal debt Federal financial
management information systems. Specifically, Fiscal Service did not consistently design, management system
implement, and operate information system controls and security programs over its cash requirements
management and Federal debt information systems in accordance with the Federal
financial management systems requirements. (First reported in fiscal year 2018)
The status of these instances of noncompliance, including progress in implementing
remediation plans, will be evaluated as part of the audit of Treasury’s fiscal year 2021
consolidated financial statements.
Treasury Office of Inspector General Semiannual Report—March 2021 10
Office of Audit – Significant Audits and Other Products
CARES Act Oversight
Title IV, Subtitle B, “Air Carrier Worker Support,” of the Coronavirus Aid, Relief, and
Economic Security Act (CARES Act) authorized up to $32 billion of direct financial
assistance for passenger air carriers ($25 billion), cargo air carriers ($4 billion), and
contractors ($3 billion). Financial assistance is to ensure the continuation of workers’
payroll and benefits with the stipulation that employees are not involuntarily
furloughed and do not receive reductions in pay and benefits. Section 4113 (d)
assigned Treasury Office of Inspector General the responsibility to audit the
certifications required to be submitted by non-241 carriers (air carriers that do not
report financial information to the Department of Transportation) and contractors.
Treasury established the Payroll Support Program (PSP) to carry out applicable
provisions of the CARES Act. Division N of the Consolidated Appropriations Act, 2021
extended the Air Carrier Worker Support by providing up to $15 billion of additional
support to passenger air carriers and contractors. The American Rescue Plan Act
(American Rescue Plan) authorized an additional $15 billion for air transportation
payroll support.
Title VI of the Social Security Act, as amended by Title V of the CARES Act,
(hereinafter referred to as Title V) established the Coronavirus Relief Fund (CRF) for
Treasury to make $150 billion in payments to each of the 50 States, qualifying units
of local government, the District of Columbia, U.S. Territories, and Tribal Governments
for necessary expenditures due to the public health emergency with respect to the
Coronavirus Disease 2019 (COVID-19).The Consolidated Appropriations Act, 2021,
extended the covered period for recipients of CRF payments to use funds between
March 1, 2020 and December 31, 2021.
Under Title V of the CARES Act, Treasury Office of Inspector General (OIG) is
assigned responsibility to conduct monitoring and oversight of the receipt,
disbursement, and use of CRF payments. Treasury OIG also was assigned authority to
recoup CRF proceeds in the event that it is determined a recipient of a CRF payment
failed to comply with requirements of subsection 601(d) of the Social Security Act, as
amended, (42 U.S.C. 801(d)). As part of our ongoing oversight of CRF payments, we
issued the following reports during this semiannual period.
Treasury Office of Inspector General Semiannual Report—March 2021 11
Office of Audit – Significant Audits and Other Products
State of Iowa’s Noncompliance with Uses of Coronavirus Relief Fund
Requirements
We issued a letter to the Director of the Iowa Department of Management
concerning the State’s use of CRF to make payments related to a portion of a
$20.1 million contract with Workday, Inc. (Workday), a computer system used
for accounting and human resources that will replace the State’s legacy
mainframe systems. We were also informed that CRF proceeds were used to
pay for some contract expenses that were incurred after March 1, 2020, and
additional funds were expected to be used for expenses that were to be
incurred before December 30, 2020. While the new and modern Workday
system may provide additional functionalities through a cloud-based
environment, the timeline for achieving them is nearly two years away and the
system upgrades were contemplated well before the pandemic began.
Accordingly, we maintained that funding the Workday contract with CRF
proceeds was not a reasonable, allowable use of funds related to addressing the
COVID-19 health pandemic. We required that amounts equal to payments
issued on the Workday contract and any system implementation expenses
related to contractor assistance using CRF proceeds be returned to Iowa’s
“Coronavirus Relief Fund” for eligible uses. Furthermore, additional CRF
proceeds should not be used to make payments on this contract. In a written
response, the State Governor authorized the return to Iowa’s Coronavirus Relief
Fund of all amounts that were initially allocated for payments on the Workday
contract, including any system implementation expenses related to contractor
assistance. (OIG-CA-21-011)
State of Rhode Island's Uses of Coronavirus Relief Fund Payment
We issued a letter to the Director of the Rhode Island Pandemic Recovery Office
concerning allegations that the State intended to withhold CRF proceeds to
balance the State’s budget shortfalls. It was believed potential legislation might
allow CRF proceeds to be used to backfill revenue shortfalls. It was noted that
State officials had internal conversations as to whether they would pivot their
approach to spending CRF proceeds if proposed legislation passed allowing
recipients to fill budget gaps. Since meeting with State representatives, the CRF
was extended by the Consolidated Appropriations Act, 2021, Division N,
“Additional Coronavirus Response and Relief.” We advised State officials that
the use of CRF proceeds to cover revenue shortfalls remains an unallowable use
of funds. The Consolidated Appropriations Act, 2021 did not change this
Treasury Office of Inspector General Semiannual Report—March 2021 12
Office of Audit – Significant Audits and Other Products
requirement as anticipated by State officials. To the extent that CRF proceeds
are used in this manner, our office will seek recoupment of those funds from the
State of Rhode Island in accordance with the CARES Act. The letter also
clarified necessary expenditures incurred due to the public health emergency.
We did not make any formal recommendations in our letter. (OIG-CA-21-018)
Interim Audit Update-Air Carrier and Contractor Certification for
Payroll Support Program
We issued an interim report related to certifications that passenger and cargo air
carriers and contractors submitted to Treasury when applying for a Payroll
Support Program (PSP) payment. To conduct our work, we selected a non-
statistical sample of 5 passenger air carriers, 4 cargo air carriers, and 7
contractors for audit. Of the 16 air carriers and contractors selected, as of the
date of this interim report, we reviewed documentation to support requested
payroll support amounts for 7 recipients (5 passenger air carriers, 1 cargo air
carrier, and 1 contractor). Based on audit work to date, we identified pervasive
issues with the calculation of payroll amounts reported to Treasury by non-241
passenger air carriers (carriers that do not report financial data to the
Department of Transportation) and contractors. These payroll amounts impacted
the accuracy of recipient award amounts. We notified Treasury of these matters
in December 2020, and according to management, Treasury implemented a
number of measures in its “Payroll Support Program Extension” application
process to identify and correct PSP award amounts. We reported that we would
resume our audit of the remaining non-241 passenger air carriers and contractor
certifications after we receive confirmation from Treasury that award amounts
are corrected.
We recommended that Treasury management (1) review payments issued under
PSP1 to ensure awarded amounts are allowable per the CARES Act and
Treasury guidance; and (2) remedy the incorrect amounts awarded under PSP1.
Management’s planned corrective actions met the intent of our
recommendations. (OIG-21-025)
CARES Act Compliance Monitoring
As part of our compliance monitoring of CRF payments, we developed a portal via
GrantSolutions, a grants management system under U.S. Department of Health and
Human Services, for CRF recipients to report expenditure data on a quarterly basis
Treasury Office of Inspector General Semiannual Report—March 2021 13
Office of Audit – Significant Audits and Other Products
starting September 1, 2020. We issued updates to the following memoranda
pertaining to CRF reporting: (1) Department of the Treasury Office of Inspector
General Coronavirus Relief Fund Frequently Asked Questions Related to Reporting and
Recordkeeping (OIG-CA-20-028R) and (2) CRF Prime Recipient Desk Reviews
(Reissued for updated guidance) (OIG-CA-21-004R).
Cyber/Information Technology
FISMA
The Federal Information Security Modernization Act of 2014 (FISMA) requires
Inspectors General to perform an annual, independent evaluation of their agency’s
information security program and practices. During this semiannual reporting period,
we issued reports on Treasury’s and the Gulf Coast Ecosystem Restoration Council’s
(Council) compliance with FISMA.
Fiscal Year 2020 Audit of Treasury’s Information Security Program
for its Unclassified Systems
KPMG, a certified independent public accounting firm working under a contract
with and supervised by our office, performed an audit of Treasury’s information
security program and practices for its unclassified systems for the period July 1,
2019 through June 30, 2020. The Treasury Inspector General for Tax
Administration (TIGTA) performed the annual FISMA evaluation of Internal
Revenue Services’ (IRS) unclassified systems. For fiscal year 2020, KPMG
reported that Treasury’s information security program and practices for its
unclassified systems were established and have been maintained for the 5
Cybersecurity Functions and 8 FISMA Metric Domains. The program was not
effective according to Department of Homeland Security (DHS) criteria. KPMG
identified 4 deficiencies within 2 of the 5 cybersecurity functions and within 4
of the 8 FISMA metric domains. KPMG made 11 recommendations to the
responsible officials to address the identified deficiencies. Treasury management
agreed with the recommendations and prepared corrective action plans that met
the intent of KPMG’s recommendations. Due to the sensitive nature of these
systems, this report is designated Sensitive But Unclassified. (OIG-21-009,
Sensitive But Unclassified)
Treasury Office of Inspector General Semiannual Report—March 2021 14
Office of Audit – Significant Audits and Other Products
Fiscal Year 2020 Audit of Treasury’s Information Security Program
for its Collateral National Security Systems
KPMG, working under a contract with and supervised by our office, performed
an audit of Treasury’s information security program and practices for its
collateral National Security Systems (NSS) for the period July 1, 2019 through
June 30, 2020. For fiscal year 2020, KPMG reported that Treasury established
and maintained its information security program and practices for its collateral
NSS for the 5 Cybersecurity Functions and 8 FISMA Metric Domains. The
program was not effective according to DHS criteria. KPMG identified 4
deficiencies within 2 of the 5 cybersecurity functions and within 4 of the 8
FISMA metric domains. KPMG made 12 recommendations to responsible
officials to address the identified deficiencies. Treasury management agreed
with the recommendations and prepared corrective action plans that met the
intent of KPMG’s recommendations. Due to the sensitive nature of these
systems, this report is designated Sensitive But Unclassified. (OIG-21-010,
Sensitive But Unclassified)
Fiscal Year 2020 Evaluation of the Gulf Coast Ecosystem
Restoration Council’s Information Security Program
RMA, a certified independent public accounting firm working under a contract
with and supervised by our office, performed this year’s annual FISMA
evaluation of the Council’s information security program and practices for the
period July 1, 2019 through June 30, 2020. RMA reported that the Council’s
information security program and practices were established, and concluded
that the Council’s information security program and practices were effective for
the period July 1, 2019 through June 30, 2020. (OIG-CA-21-003)
Treasury Office of Inspector General Semiannual Report—March 2021 15
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Office of Investigations – Significant Investigations
CARES Act Investigation
We initiated an investigation upon receipt of information from an airline industry
business that received funds under Section 4003 of the Coronavirus Aid, Relief, and
Economic Security Act (CARES Act). The business self-reported that some of their
employees were underreporting hours worked and filing unemployment claims in
Louisiana, in order to qualify for enhanced unemployment benefits under the CARES
Act. Criminal prosecution of the employees was presented on December 10, 2020,
and declined by the U.S. Attorney’s Office (USAO) for the Eastern District of
Louisiana.
Other Significant Investigations
Allegation Substantiated for Subject that Fraudulently Obtained DC
Pension Benefits Totaling $320,292
We initiated an investigation upon notification from the Bureau of the Fiscal Service
(Fiscal Service) that a subject received more than 20 years of retirement payments
totaling $320,292, after the death of the authorized annuitant. Criminal prosecution of
the subject was presented on December 8, 2020 and declined by the USAO for the
District of Maryland. We provided a report to the Fiscal Service for their information.
Mint Contract Employees Terminated for Theft of Government Property
On February 12, 2021, we received a response from the United States Mint (Mint)
regarding our investigation of three Mint contractors, who removed penny planchets, 2
“blanks” from the Mint, and exchanged the planchets for legitimate currency in
automated coin machines. Criminal prosecution was presented and declined by the
USAO for the District of Colorado; however, the employees were terminated and
security measures were enhanced.
2
A planchet is a round metal disk ready to be struck as a coin. It is also referred to as a blank.
Treasury Office of Inspector General Semiannual Report—March 2021 17
Office of Investigations – Significant Investigations
Allegations of Workers’ Compensation Fraud by an Office of the
Comptroller of the Currency Employee Substantiated
We initiated an investigation upon notification that an Office of the Comptroller of the
Currency (OCC) employee provided false statements to their agency and medical
providers to obtain and continue to receive workers’ compensation. We substantiated
the allegation; however, criminal prosecution was declined on March 5, 2021, by the
USAO for the Northern District of Texas. We provided a report to the OCC for their
information.
Mint Employee Sent Anonymous Harassing Letters to Management
On November 9, 2020, we received a response from the Mint regarding an employee
who submitted harassing anonymous letters to Mint management. Our forensic
analysis determined the identity of the employee that sent the letters. During our
interview with the employee, the employee provided false statements. The employee
received a 5-day suspension for lack of candor.
Findings of Misconduct by a Treasury OIG Employee Substantiated for
Misusing Government Title and Government Email for Personal Gain
We initiated an investigation upon receipt of information from a hotline complaint that
a Treasury Office of Inspector General (OIG) employee used their title, government
computer and email to enhance a complaint made to a local court administrator. We
substantiated the allegation that the employee misused their government position for
personal gain. OIG management verbally counseled the employee and required them to
attend ethics training.
Misconduct Unsubstantiated for Two Companies that Allegedly Installed
and Overcharged for Faulty Fire and Security Systems at a Bureau of
Engraving and Printing Facility
We initiated an investigation based on an anonymous complaint alleging one company
failed to install a working fire system in the Bureau of Engraving and Printing (BEP)
facility in Fort Worth, Texas, and that another company overcharged BEP for faulty
security equipment. We did not substantiate either allegation.
Treasury Office of Inspector General Semiannual Report—March 2021 18
Treasury OIG Accomplishments and Activities
Office of Investigation’s Participation “Operation Find Our Children”
The U.S. Marshals Service conducted a significant 5-day law enforcement effort,
dubbed “Operation Find Our Children,” throughout the Commonwealth of Virginia that
resulted in the rescue of 27 previously missing children and confirmed the location of
6 additional children previously reported as missing and subsequently discovered by
the U.S. Marshals Service as being in the custody of their legal guardian. An Office of
Investigation’s agent participated as a member of a U.S. Marshals’ Task Force,
ensuring the continued safety of vulnerable children.
Treasury OIG Leadership Roles
Department of the Treasury (Treasury or the Department) OIG professionals serve on
various important public and private professional organizations supporting the Federal
audit community. Examples of participation in these organizations follow:
Deborah Harker, Assistant Inspector General for Audit, serves as the Co-Chair of the
Council of the Inspectors General on Integrity and Efficiency (CIGIE) Federal Audit
Executive Council’s (FAEC) Digital Accountability and Transparency Act (DATA Act)
Working Group Governance Committee. Ms. Harker also represents CIGIE on the Chief
Financial Officers Council, Leveraging Data as a Strategic Asset Working Group.
Ms. Harker also represents Treasury OIG on the National Association of State
Auditors, Comptrollers, and Treasurers COVID-19 Accountability Work Group.
Pauletta Battle, Deputy Assistant Inspector General for Financial Management and
Transparency Audits, chairs the Federal Audit Executive Council’s DATA Act Working
Group, which educates Inspectors General and Government financial communities on
the DATA Act oversight process. The Working Group consists of approximately 200
members representing at least 48 OIGs.
Donna Joseph, Deputy Assistant Inspector General for Cyber and Financial Assistance
Audits, serves as the National Single Audit Coordinator for Treasury, and is a member
of the American Institute of Certified Public Accountants’ (AICPA) National
Governmental Accounting and Auditing Update Conference planning committee.
Ms. Joseph serves with James Hodge, Audit Director, on the AICPA National
Governmental Accounting and Auditing Update Conference planning committee.
Treasury Office of Inspector General Semiannual Report—March 2021 19
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Statistical Summary
Summary of Treasury OIG Activities
October 1, 2020 through March 31, 2021
Number or
OIG Activity Dollar Value
Office of Counsel Activities
Regulation and legislation reviews 5
Instances where information was refused 0
Office of Audit Activities
Reports issued and other products 42
Disputed audit recommendations 0
Significant revised management decisions 0
Management decision in which the Inspector General disagrees 0
Monetary benefits (audit)
Questioned costs $0
Funds put to better use $0
Total monetary benefits $0
Office of Investigations Activities*
Criminal and judicial actions (including joint investigations)
Investigative reports issued 184
Cases referred for prosecution and/or litigation 15
Individuals referred for criminal prosecution to the Department of Justice 17
Individuals referred for criminal prosecution to state and local authorities 0
Cases accepted for prosecution and/or litigation 4
Arrests 1
Indictments/informations 3
Convictions (by trial and plea) 15
Senior Staff Cases Closed During SAR Period with Misconduct Allegations 1
*During the reporting period defendants were sentenced to 666 months of prison time, 972 months of
probation, 1 month of community service and ordered to pay fines, restitution, and court fees in the
amount of $3.1 million, seizures and forfeitures in the amount of $505,570, and civil judgments, civil
settlements, and civil recoveries in the amount of $2 million.
Metrics Used for Office of Investigations Activities
Department of the Treasury (Treasury or the Department) Office of Inspector General
(OIG) investigative statistics listed above were obtained through reports drawn from
Treasury OIG’s Office of Investigations case management system.
Treasury Office of Inspector General Semiannual Report—March 2021 21
Statistical Summary
Reports with Unimplemented Recommendations
Issued prior to October 1, 2020
The following list of Treasury OIG reports with unimplemented recommendations is
based on information in Treasury’s automated audit recommendation tracking system,
which is maintained by Treasury management officials, and recommendations tracked
by other Federal organizations related to Treasury OIG’s oversight of the Resources
and Ecosystems Sustainability, Tourist Operations, and Revived Economies of the Gulf
Coast States Act of 2012 (RESTORE Act) programs and activities of the Gulf Coast
Ecosystem Restoration Council (Council) and the National Oceanic and Atmospheric
Administration’s Gulf Coast Ecosystem Restoration Science, Observation, Monitoring,
and Technology Program.
Treasury OIG is reporting 105 open and unimplemented recommendations for
18 reports issued prior to October 1, 2020, with $2,550 in potential monetary
benefits. Treasury OIG considers all unimplemented recommendations for reports
issued over 6 months to be significant.
Treasury Office of Inspector General Semiannual Report—March 2021 22
Statistical Summary
Treasury Programs and Operations
Fiscal Report Number Report Title Date
Year Issued
2016 OIG-16-059 General Management: Treasury Has Policies 09/16
and Procedures to Safeguard Classified
Information but They Are Not Effectively
Implemented
1. The Assistant Secretary for Intelligence and Analysis should direct the
Deputy Assistant Secretary for Security to update the Treasury Security
Manual to include procedures requiring the Office of Security Programs to
follow up and obtain all bureau self-inspection reports. Management agreed
with the recommendation.
2017 OIG-17-044 Terrorist Financing/Money Laundering: Federal 05/17
Agencies Are Generally Satisfied with TFFC's
Collaboration Efforts, but Enhancements Can
Be Made
1. The Assistant Secretary for Terrorist Financing should develop policies and
procedures to ensure continuity and consistency in collaboration efforts
with interagency task forces and workgroups.
2. Develop and implement a mechanism to monitor, evaluate, and report on
the effectiveness of the Office of Terrorist Financing and Financial Crimes'
(TFFC) interagency collaboration.
3. Develop meaningful performance measures specific to TFFC collaboration.
4. Address areas of concern expressed by Federal agencies regarding TFFC’s
collaboration that includes feedback, intersessional meetings, and invitations
to participate in bilateral meetings with foreign countries during the Financial
Action Task Force Plenary. Management agreed with the recommendations.
Treasury Office of Inspector General Semiannual Report—March 2021 23
Statistical Summary
Fiscal Report Number Report Title Date
Year Issued
2018 OIG-18-018 Terrorist Financing/Money Laundering: OFAC 11/17
Human Resources Practices Need
Improvement
1. The Office of Foreign Assets Control (OFAC) Director should ensure that
legacy employees' current position descriptions are evaluated to ensure that
the documented promotion potential of these non-supervisory employees is
consistent with OFAC's current promotion practices. Management agreed
with the recommendation.
2018 OIG-18-043 Terrorist Financing/Money Laundering: 04/18
OFAC’s Licensing Program Would Benefit
From System Enhancements
1. The Director of OFAC should develop performance measures specific for the
licensing division. Management agreed with the recommendation.
2018 OIG-18-044 Terrorist Financing/Money Laundering: Audit 04/18
of the Office of Intelligence and Analysis’
Authorities and Actions Related to U.S.
Persons’ Financial Information
1. The Under Secretary for Terrorism and Financial Intelligence, as
expeditiously as possible, should ensure that the Office of Intelligence and
Analysis’s (OIA) U.S. Persons Procedures are finalized and submitted for
approval to the Attorney General of the United States.
2. Implements a compliance monitoring program to assess whether intelligence
analysts' activities are conducted in accordance with OIA authorities, and
electronic searches and other queries are performed in a manner that fully
protects the rights of U.S. persons. Management agreed with the
recommendations.
Treasury Office of Inspector General Semiannual Report—March 2021 24
Statistical Summary
Fiscal Report Number Report Title Date
Year Issued
2019 OIG-19-007 Information Technology: Department of the 10/18
Treasury Federal Information Security
Modernization Act Fiscal Year 2018
Performance Audit
1. Treasury Inspector General for Tax Administration (TIGTA) management
should establish a current enterprise baseline of software and related
configurations for the TIGTA System.
2. Develop and disseminate to TIGTA personnel a TIGTA System Information
System Contingency Plan that addresses purpose, scope, roles,
responsibilities, management commitment, coordination, and compliance to
facilitate the implementation of the contingency planning policy and
associated contingency planning controls. TIGTA should conduct disaster
recovery and business continuity testing for the TIGTA System on the
frequency stipulated by a Business Impact Analysis. Management agreed
with the recommendations.
2019 OIG-19-040 DATA Act: Treasury's Efforts to Increase 07/19
Transparency Into Federal Spending Continue,
But Further Refinement is Needed
1. The Fiscal Assistant Secretary should enhance generic disclaimers on
USAspending.gov and expand the use of limitation statements on pages
with known and potential display issues so that the public has a clear
understanding of known limitations when using the data as displayed and
available for download. Management agreed with the recommendation.
Treasury Office of Inspector General Semiannual Report—March 2021 25
Statistical Summary
Fiscal Report Number Report Title Date
Year Issued
2020 OIG-20-002 Information Technology: Department of the 10/19
Treasury Federal Information Security
Modernization Act Fiscal Year 2019
Performance Audit for Collateral National
Security Systems (Sensitive but Unclassified)
1. This recommendation is Sensitive But Unclassified. Management agreed
with the recommendation.
Fiscal Report Number Report Title Date
Year Issued
2020 OIG-20-003 Information Technology: Department of the 10/19
Treasury Federal Information Security
Modernization Act Fiscal Year 2019
Performance Audit
1. The Bureau of Engraving and Printing (BEP) management should assess and
remediate vulnerabilities identified during Security Content Automation
Protocol (SCAP) configuration baseline compliance and vulnerability
scanning within the required timeframes specified in the BEP Minimum
Standard Parameters.
2. Departmental Offices (DO) management should develop and implement a
process to ensure that periodic user access reviews are completed for DO
System 2, documented, and all unnecessary access is removed in
accordance with National Institute of Standards and Technology Special
Publication 800-53 Revision 4, “Security and Privacy Controls for Federal
Information Systems and Organizations” (NIST SP 800-53, Rev. 4) and
Treasury Directive Publication 85-01, “Department of the Treasury
Information Technology Security Program” (TD P 85-01).
Treasury Office of Inspector General Semiannual Report—March 2021 26
Statistical Summary
Fiscal Report Number Report Title Date
Year Issued
2020 OIG-20-003 Information Technology: Department of the 10/19
Treasury Federal Information Security
Modernization Act Fiscal Year 2019
Performance Audit
3. Bureau of the Fiscal Service (Fiscal Service) management should protect the
confidentiality and integrity of transmissions by encrypting Fiscal Service
System 2 data in transit as required by NIST 800-53, Rev. 4.
4. United States Mint (Mint) management should establish a quality control
process to ensure that user access to Mint System 1 and other Mint
information systems follow the access management process requiring the
completed background investigations, signed non-disclosure agreements
(NDA), signed rules of behavior (ROB), and completion of the security
awareness training.
5. Mint management should clearly document and formally approve
exemptions to the Mint's access authorization process when a business
justification exists.
6. Mint management update the Mint Information Security Policy to meet TD P
85-01 and NIST requirements related to access agreements and ROB.
7. Mint management should finalize and implement its bureau-wide privacy
program that includes a strategic organizational privacy plan for
implementing applicable privacy control and procedures in accordance with
NIST 800-53.
8. Mint management should implement mechanisms to monitor and audit on a
regular basis the effectiveness of its privacy controls and internal privacy
policy at the bureau-level.
9. Mint management should establish sufficient controls to ensure
supervisors/managers are held accountable for the completion of the role-
based specialized information technology security training by their
employees with security roles and responsibilities. Management agreed with
the recommendations.
Treasury Office of Inspector General Semiannual Report—March 2021 27
Statistical Summary
Fiscal Report Number Report Title Date
Year Issued
2020 OIG-20-007 DATA Act: Treasury Continues to Make 11/19
Progress in Meeting its DATA Act Reporting
Requirements
1. Treasury's Assistant Secretary for Management (ASM), working as needed
with Treasury's Senior Accountable Official, the Senior Procurement
Executive, reporting entities, the Program Management Office, and the
Office of Management and Budget (OMB) develop and implement a method
and procedures to submit Treasury Forfeiture Fund financial assistance
award data to the Financial Assistance Broker Submission in accordance
with the reporting submission specifications established by DATA Act
Information Model Schema (DAIMS). Management agreed with the
recommendation.
2020 OIG-20-015 Financial Management: Management Letter 12/19
for the Audit of the Department of the
Treasury's Financial Statements for Fiscal
Years 2019 and 2018
1. DO management should communicate the timeframe required to disable or
remove the access of terminated employees and contractors from DO
systems to the appropriate staff. Management agreed with the
recommendation.
2020 OIG-20-015 Financial Management: Management Letter 12/19
for the Audit of the Department of the
Treasury's Financial Statements for Fiscal
Years 2019 and 2018
1. DO management should communicate the timeframe required to disable or
remove the access of terminated employees and contractors from DO
systems to the appropriate staff. Management agreed with the
recommendation.
Treasury Office of Inspector General Semiannual Report—March 2021 28
Fiscal Report Number Report Title Date
Year Issued
2020 OIG-20-022 Financial Management: Management Report 12/19
for the Audit of the Department of the
Treasury's Consolidated Financial Statements
for Fiscal Years 2019 and 2018
1. Fiscal Service management should address the mainframe operating system
vulnerabilities noted in the condition as soon as possible.
2. Develop a tailored mainframe operating system security configuration
baseline that specifies how security configuration options are to be set
based on the selected industry guidance.
3. Ensure that the chief information security officer assign specific
responsibility for providing controls over operating system security,
including access permissions to all system datasets and all security-related
option settings.
4. Develop and document controls over changes and monitor update access to
all key system datasets.
5. Develop and document controls and baseline documentation of mainframe
operating system options specified in the configuration files.
6. Establish which techniques are to be used to control update access to key
system datasets and to control read access to sensitive system datasets
(such as the security software database and the page files), whether a
third-party tool is to be used, or tailored change control mechanisms, and
develop procedures and documentation to support their use.
7. Develop procedures to provide assurance that programs installed with the
privileges of the operating system (whether purchased from software
vendors or internally developed) do not introduce security weaknesses.
8. Develop, document, and implement policies, procedures, and controls to
conduct periodic reviews of actual mainframe security software settings
against the security baseline.
Fiscal Report Number Report Title Date
Year Issued
2020 OIG-20-022 Financial Management: Management Report 12/19
for the Audit of the Department of the
Treasury's Consolidated Financial Statements
for Fiscal Years 2019 and 2018
9. Develop a mainframe security software risk assessment process using the
Defense Information Systems Agency (DISA) Security Technical
Implementation Guide (STIG) as a guideline.
10. Develop a tailored mainframe security software configuration baseline that
specifies how security configuration options should be set based on the
industry guidance. As part of this action, management should develop and
document a baseline specifying for each possible setting in the security
software control file how the option should be set and who is responsible
for approving the setting.
11. Use the mainframe security software configuration baseline to harden the
mainframe environment, including the Payment Authorization Manager
(PAM) and Payments, Claims, and Enhanced Reconciliations (PACER)
production.
12. Remove duplicate and excessive permissions in the mainframe security
software database.
13. Perform an annual comparison of each actual setting in the mainframe
security software control file to each setting specified in the baseline to
verify compliance with the baseline.
14. Develop and document procedures for controlling updates to the mainframe
security software control file.
15. Define and document the segregation of functions and privileges based on
the principle of least privilege for mainframe security software and operating
system.
16. Review and establish access permissions to the mainframe system and
security software based on the principle of least privilege access.
Fiscal Report Number Report Title Date
Year Issued
2020 OIG-20-022 Financial Management: Management Report 12/19
for the Audit of the Department of the
Treasury's Consolidated Financial Statements
for Fiscal Years 2019 and 2018
17. Review and re-assess each access permission in the mainframe security
software dataset and resource rules on a periodic basis.
18. Develop procedures and documentation to establish the following for each
dataset permission, resource permission, and mainframe security software
privilege: a. Responsibility for approving access and enforcing compliance
with the principle of least privilege; b. Actual access meets the principle of
least privilege; and c. Any discrepancy from approved access will be
identified and corrected.
19. Develop, document and implement policies, procedures, and controls for
comprehensive logging and monitoring of events. Procedures and controls
should include an annual re-assessment of whether logging and reporting is
adequate.
20. Review and determine which profiles, applications, databases, and other
processes on the mainframe will be logged and reviewed.
21. Assess all mainframe logs to determine which logs should be evaluated by
the incident management tool.
22. Establish appropriate alerts and event thresholds for those mainframe logs
required to be evaluated by the external tracking tool.
23. Develop and implement data and analysis tools and processes for identifying
event trends, patterns, spikes, and exceptions tool.
24. Identify non-security related purposes for logging and monitoring (including
performance tuning, problem management, capacity planning, and
management of service level agreements); assign responsibility for
addressing them and for integrating them with security uses of logging and
monitoring.
Fiscal Report Number Report Title Date
Year Issued
2020 OIG-20-022 Financial Management: Management Report 12/19
for the Audit of the Department of the
Treasury's Consolidated Financial Statements
for Fiscal Years 2019 and 2018
25. Identify the possible sources of log information; determine how each is to
be used for security monitoring; and develop procedures to ensure that each
type of logging which is necessary for effective security monitoring is
activated.
26. Annually assess the effectiveness of security logging and monitoring,
ensuring that the volume of logged events is limited to just those that are
needed for security, and ensuring that monitoring results include effective
identification and response for any violations and for any significant trends
(such as an increase in the number of password resets for a given group of
users or repetition of the same attempted but failed attempt to access a
productions dataset or resource).
27. Identify, document, and assess the mainframe security controls affecting
the system software, to fully describe how mainframe security is provided.
These Fiscal Service management controls should include: a. Specific
assignment of responsibility for maintaining operating security, b. Skill
assessment and remediation for operating system security maintenance,
c. Baseline documents for mainframe configuration files, d. Standard
procedures for review and maintenance of operating system security, and
e. Standard procedures to compare actual configuration settings to baseline
documents.
28. Update mainframe documentation to be consistent with Fiscal Service and
TD P 85-01.
29. Develop procedures and documentation to establish who is responsible and
how effective security is achieved for controls requirements.
30. Implement an oversight process to determine that designated Fiscal Service
personnel reviews and reevaluates privileges associated with the UNIX
production environment semiannually for privileged accounts.
Fiscal Report Number Report Title Date
Year Issued
2020 OIG-20-022 Financial Management: Management Report 12/19
for the Audit of the Department of the
Treasury's Consolidated Financial Statements
for Fiscal Years 2019 and 2018
31. Configure the systems-management software agents to include all UNIX
servers, databases, and users' accounts within the UNIX environment when
generating the users' lists for the semiannual review and recertification
process so that all privileged and non-privileged users' access is reviewed.
32. Update UNIX semiannual account review and recertification procedures to
include quality control steps to validate that systems-management software
is generating complete and accurate account listings for all UNIX servers
and databases privileged and non-privileged user accounts within the UNIX
environment prior to completing the review and recertification process.
33. Finalize policies and procedures to review audit logs of production DB2
servers.
34. Implement an oversight process to ensure that designated Fiscal Service
personnel: a. Reviews the security logs for the UNIX and DB2 servers
hosting the Payment Information Repository (PIR), Judgment Fund Internet
Claim System (JFICS), and Security Payment System (SPS) applications on
a pre-defined frequency, as indicated in the Fiscal Service Baseline Security
Requirements (BLSR). b. Formally documents completion of their reviews
and any escalations to the Information System Security Office, and
c. Retains the audit logs and documentation of its reviews for 18 months,
as required by the BLSR.
35. Periodically review Fiscal Service management's implementation and
operation of the review the security audit logs for the UNIX and DB2 servers
hosting the PIR, JFICS, and SPS applications to determine that Fiscal
Service management completes the reviews on a pre-defined basis,
documents completion of the reviews and escalations, and maintains such
documentation.
Fiscal Report Number Report Title Date
Year Issued
2020 OIG-20-022 Financial Management: Management Report 12/19
for the Audit of the Department of the
Treasury's Consolidated Financial Statements
for Fiscal Years 2019 and 2018
36. Establish an effective enforcement process or mechanism to ensure that
(a) UNIX and DB2 events and monitoring controls are followed, and
(b) Fiscal Service management has confidence it consistently reviews for
potential unauthorized or inappropriate activity.
37. Update its current PIR security procedures to require that management
obtain current PIR developer access requirement listings from the service
provider and use them when validating the appropriateness of PIR developer
access during the semiannual access reviews and recertification of the PIR
and UNIX environments.
38. Maintain the documentation used to review and recertify the access of the
known PIR service provider developers evidencing that their access to the
UNIX environments is commensurate with their job functions and
responsibilities.
39. Ensure that developers do not have the ability to make changes to the PIR
production environment.
40. Remove users' access once validated by the Federal Program Agency (FPA),
during the SPS annual user access review.
41. Retain evidence of recertification of all users.
42. Oversee the recertification process and ensure that access corrections are
processed once received from the FPA.
43. Review and enhance the manual processes and procedures to ensure that
user access to all resources as defined for Treasury Web Application
Infrastructure (TWAI) users are accurately and completely identified and
evaluated during the course of the General Support System 1 (GSS1) and
General Support System 2 (GSS2) TWAI User Privilege Recertification
cycles.
Fiscal Report Number Report Title Date
Year Issued
2020 OIG-20-022 Financial Management: Management Report 12/19
for the Audit of the Department of the
Treasury's Consolidated Financial Statements
for Fiscal Years 2019 and 2018
44. Complete the GSS1 TWAI User Access Recertification cycle within the time
intervals set by Fiscal Service BLSR requirements.
45. Remove and disable the two users' access immediately.
46. Implement a quality control process to ensure that PIR application accounts
defined to the PIR production environment that have been inactive for over
120 days are disabled.
47. Review and update the Enterprise Information Technology Infrastructure
System Security Plans, Attachment A-Security Control Matrix, to be
consistent with the Fiscal Service BLSR and the Chief Information Officer
Publication Information System Security Internal Standard Operating
Procedure 8.3.6.60 UNIX/LINUX Account Management.
48. Configure the six UNIX servers to enforce the minimum password as stated
in the Fiscal Service BLSR and ensure that the default password
configuration settings for the production Unix environments comply with the
minimum requirements specified in the BLSR.
49. Develop and implement a quality control process to ensure that PIR
emergency change approvals are consistently obtained, documented, and
retained by the Change Control Board prior to implementing changes into
the PIR production environment.
50. Develop and implement documentation to assign responsibility for ensuring
adequacy of UNIX and database security and baseline settings.
51. Update existing UNIX and database configuration security baseline
documents to ensure that these documents fully incorporate and enforce
the components of the DISA STIG. Management should document any
deviations from the STIGs and note compensating controls that mitigate the
security risk to an acceptable level.
Fiscal Report Number Report Title Date
Year Issued
2020 OIG-20-022 Financial Management: Management Report 12/19
for the Audit of the Department of the
Treasury's Consolidated Financial Statements
for Fiscal Years 2019 and 2018
52. Develop, document, and implement policies, procedures, and controls to
conduct periodic reviews of actual UNIX and database settings against the
security configuration baselines.
53. Provide logging and monitoring of security related events to include the
retention of evidence of reviews performed.
54. Develop a baseline of essential security settings and specifying that baseline
as the standard to be observed.
55. Implement corrective actions to address all vulnerabilities associated with
the baseline enforcement to include removing the three default user
accounts on UNIX servers. Management agreed with the recommendations.
Statistical Summary
Fiscal Year Report Number Report Title Date
Issued
2020 OIG-20-027 Resource Management: Audit of the 02/20
Department of the Treasury Departmental
Offices Executive Pay Adjustments,
Bonuses, and Awards
1. The ASM should ensure that the Office of the Deputy Assistant Secretary
for Human Resources and Chief Human Capital Officer (DASHR/CHCO)
and the Office of Executive Resources (OER) develop, implement, and
include effective internal controls within its policies and standard
operating procedures (SOP) to ensure Treasury's Senior Executive Service
(SES) basic pay rates are in compliance with 5 CFR 534.403(a)(3)(b),
Suspension of certification of performance appraisal system; and 5 CFR
534.404 (h)(2), Setting pay upon transfer.
2. DASHR/CHCO and OER calculate the overpayment amounts for the two
DO SES members whose pay was set higher than allowed by regulation.
3. DASHR/CHCO and OER seek recovery of the overpayment amounts or
exercise the authority to waive any claim in accordance with applicable
Federal regulations and Treasury's Directive 34-01, Waiving Claims
Against Treasury Employees for Erroneous Payments.
4. DASHR/CHCO and OER complete Office of Personnel Management (OPM)
data calls in accordance with OPM's applicable instructions and guidance
to ensure all required employees, such as those who have left Treasury,
are properly reported.
5. DASHR/CHCO finalizes and approves Treasury's SES Pay and Awards
policy, and then periodically reviews it for continued relevance,
effectiveness, and transparency in making pay decisions and awarding
bonuses, assesses staffing levels, workforce skills, and respective
budgets to determine whether additional personnel should and can
plausibly be incorporated into future strategic planning to ensure OER can
meet its goals and mission.
Treasury Office of Inspector General Semiannual Report—March 2021 37
Statistical Summary
Fiscal Year Report Number Report Title Date
Issued
2020 OIG-20-027 Resource Management: Audit of the 02/20
Department of the Treasury Departmental
Offices Executive Pay Adjustments,
Bonuses, and Awards
6. DASHR/CHCO finalizes and approves Treasury's SES Pay and Awards
policy, and then periodically reviews it for continued relevance,
effectiveness, and transparency in making pay decisions and awarding
bonuses.
7. OER documents the processes and SOP, with appropriate detail, followed
in administering Treasury DO SES member performance ratings, pay
adjustments, and bonuses.
8. OER oversees the process regarding exceptions to the 12-month rule.
9. OER includes information regarding the approval process for waiver
requests for exceptions to the 12-month rule in the instructions provided
to bureau heads and DO policy offices. This information should be
consistent with Federal regulations and Treasury's SES Pay and Awards
policy.
10. OER submits Treasury's respective data call report to OPM by the due
dates established by 5 CFR 534.405, Performance awards, and before
any established deadlines per OPM's annual data call memorandum.
Management agreed with the recommendations.
Questioned $2,550
Cost
Treasury Office of Inspector General Semiannual Report—March 2021 38
Statistical Summary
Fiscal Report Number Report Title Date
Year Issued
2020 OIG-20-029 Gulf Coast Restoration: Jefferson Parish's 03/20
Internal Control over Federal Awards
1. & 2. The Fiscal Assistant Secretary should ensure that deficiencies identified in
Jefferson Parish, Louisiana's (Jefferson Parish) controls over Federal awards
are considered as part of the Treasury's oversight of future awards as well
as risk assessments of Jefferson Parish as required by the Uniform
Administrative Requirements, Cost Principals, and Audit Requirements for
Federal Awards (2 CFR Part 200) (Uniform Guidance). Management agreed
with the recommendation. This recommendation is counted as two
recommendations because it applies to both findings in the report.
2020 OIG-20-030 Bill and Coin Manufacturing: The United 03/20
States Mint Numismatic Order Management
System is Meeting User Needs But
Improvements to Oversight are Needed
1. The Mint Director ensures the Numismatic and Bullion Directorate retains
evidence of its monitoring activities outlined in the contract's Quality
Assurance Surveillance Plan to better document the Mint's oversight of the
contractor's compliance with contract requirements.
2. Perform an assessment regarding the impact of not having language
accessibility for Mint's numismatic program services and considers adding
these services to the Mint's Order Management System (OMS-II).
3. Perform analyses to determine the feasibility and potential impact of
proposed actions to improve numismatic sales, performs additional studies
to enhance future sales, and reports the results to stakeholders.
Management agreed with the recommendations.
Treasury Office of Inspector General Semiannual Report—March 2021 39
Statistical Summary
Fiscal Report Number Report Title Date
Year Issued
2020 OIG-20-036 Interim Audit Update – Coronavirus Relief 05/20
Fund Recipient Reporting
1. Treasury management should support our office in accomplishing our
monitoring and oversight responsibilities in the following ways: (1) assist in
communications with Coronavirus Relief Fund recipients on matters that
include, but are not limited to, communications of reporting and record
keeping requirements and other audit inquiries, as needed; (2) ensure that
Treasury maintains communication channels with recipients to obtain and
address post payment inquiries regarding specific payments; and (3)
continue to update Coronavirus Relief Fund guidance and disseminate to
recipients as needed. Management agreed with the recommendation.
2020 OIG-20-040 BILL AND COIN MANUFACTURING: Audit of 06/20
Bureau of Engraving and Printing’s
Implementation of Security Features and
Meaningful Access for the Blind and Visually
Impaired into New Note Design
1. The Director of BEP in collaboration, as necessary, with members of the
United States Currency Program:
Continue to improve the Banknote Development Process and Technology
Development Process guidance, including refining procedures to reflect
lessons learned during its Catalyst note series redesign.
2. Ensure the Advanced Counterfeit Deterrence Steering Committee charter is
updated in a timely manner, and as needed, to ensure roles, responsibilities,
and current practices such as the attendance of Advanced Counterfeit
Deterrence Steering Committee monthly meetings by appropriate personnel
are clearly defined and communicated to its members. Management agreed
with the recommendations.
Treasury Office of Inspector General Semiannual Report—March 2021 40
Statistical Summary
Fiscal Report Number Report Title Date
Year Issued
2020 OIG-20-042 MANUFACTURING AND REVENUE: Mint 08/20
Controls Over Raw Materials and Coin
Exchange Programs Need Improvement
1. The U.S. Mint Director should conduct regular reviews of the suppliers’
quality systems to ensure that the suppliers are acting in the best interest of
the Mint. This includes regular site visits or periodic reviews of the
suppliers’ quality system documentation.
2. Develops and implements SOPs that are consistent among Mint facilities to
ensure quality assurance processes over sampling, inspection, and testing of
materials for circulating coinage are standardized and documented; and that
materials received meet the specifications required in the contracts and by
U.S. law.
3. Considers sampling and testing the material after blanking in order to assess
the material quality throughout the coil.
4. Verifies incoming raw material weights to ensure that the Mint is receiving
the raw materials paid for.
5. Considers improving raw materials traceability by using a unique number to
identify each coil rather than a group lot number.
6. Strengthens and finalizes SOPs for all coin exchange programs before
accepting any redemptions. This would include using tests and subject
matter experts to authenticate the genuineness of coins redeemed, as well
as working with the Board to develop appropriate interagency procedures to
assure the integrity of the coin redemption process for uncurrent coins.
Treasury Office of Inspector General Semiannual Report—March 2021 41
Statistical Summary
Fiscal Report Number Report Title Date
Year Issued
2020 OIG-20-042 MANUFACTURING AND REVENUE: Mint 08/20
Controls Over Raw Materials and Coin
Exchange Programs Need Improvement
7. Follows all SOPs, including but not limited to, procedures related to
sampling, inspecting, and testing coins; and appropriately documenting
redemptions. Additionally, ensure that adequate background investigations
are conducted on bulk redeemers and decisions to allow participation into
the Mutilated Coin Redemption Program are based on relevant data from the
background investigation. The Mint should add criteria such as obtaining
financial statements for analyses of the potential bulk redeemers and
performing site visits at their premises as part of the background
investigation process for entry into the program. The Mint should document
how this criteria was met, and if these steps were not performed, the
reasons why.
8. Ensures that all coins returned to the Mint and removed from circulation are
destroyed timely and sufficiently accounted for. Management agreed with
the recommendations.
Closed Investigations of Senior Government Employees Not
Publicly Disclosed
October 1, 2020 through March 31, 2021
Treasury OIG closed one investigation involving a senior Government employee during
the period that was not publicly disclosed. This instance of misconduct against a
senior Government employee was unsubstantiated.
Case Number Allegation/Disposition
DO-21-0013-I Treasury received an allegation against a Senior Treasury,
Departmental Offices (DO) employee for conflict of interest due
to a personal or business relationship. The complainant alleged
that the DO employee influenced a blanket purchase agreement
Treasury Office of Inspector General Semiannual Report—March 2021 42
Statistical Summary
contracting process with the DO employee’s former employer,
a covered relationship. Treasury OIG did not substantiate the
allegation by determining that the contract solicitation, bidding,
rating and selection process did not involve nor was influenced
by the DO employee. The report of investigation was
completed on January 25, 2021.
Unsubstantiated
Summary of Instances of Whistleblower Retaliation
October 1, 2020 through March 31, 2021
There were no cases of possible whistleblower retaliation opened during this reporting
period. As such, there were no established cases of whistleblower retaliation to report
for the period.
Summary of Attempts to Interfere With Treasury OIG
Independence, Including Instances Where Information or
Assistance Request was Refused
October 1, 2020 through March 31, 2021
There were no attempts made to resist, delay, or restrict Treasury OIG access to
records or other information and no instances where an information or assistance
request was refused during this reporting period.
Treasury Office of Inspector General Semiannual Report—March 2021 43
Statistical Summary
Listing of Audit Products Issued
October 1, 2020 through March 31, 2021
In the list of 42 audit products below we identified 4 products that were issued during
the reporting period that were not publicly disclosed.
Office of Audit
FINANCIAL MANAGEMENT: Report on the Bureau of the Fiscal Service’s Description
of Federal Investments and Borrowings Branch’s Investment and Redemption Service
and the Suitability of the Design and Operating Effectiveness of its Controls for the
Period August 1, 2019, to July 31, 2020 (OIG-21-001, 10/5/2020)
FINANCIAL MANAGEMENT: Report on the Bureau of the Fiscal Service’s Description
of Funds Management Branch’s Trust Funds Management Processing Service and the
Suitability of the Design and Operating Effectiveness of its Controls for the Period
August 1, 2019 to July 31, 2020 (OIG-21-002, 10/5/2020)
Quarterly Summary Memorandum for the Lead Inspector General, Department of
Defense: Operation Inherent Resolve - Summary of Work Performed by the Department
of the Treasury Related to Terrorist Financing, ISIS, and Anti-Money Laundering for
Fourth Quarter Fiscal Year 2020 (OIG-CA-21-001, 10/6/2020)
Letter to the Honorable Andrew Wheeler, Administrator, Environmental Protection
Agency and Chairperson, Gulf Coast Ecosystem Restoration Council: 2021
Management and Performance Challenges (OIG-CA-21-002, 10/7/2020)
FINANCIAL MANAGEMENT: Audit of the United States Mint’s Schedules of Custodial
Deep Storage Gold and Silver Reserves as of September 30, 2020 and 2019
(OIG-21-003, 10/21/2020)
INFORMATION TECHNOLOGY: The Gulf Coast Ecosystem Restoration Council Federal
Information Security Modernization Act of 2014 for Fiscal Year 2020
(OIG-CA-21-003, 10/26/2020)
Coronavirus Relief Fund Prime Recipient Desk Review Procedures (OIG-CA-21-004,
10/26/2020)
Treasury Office of Inspector General Semiannual Report—March 2021 44
Statistical Summary
Annual Plan, Fiscal Year 2021, Office of Inspector General, Department of the
Treasury (OIG-CA-21-005, 10/27/2020)
Management And Performance Challenges Facing the Department of the Treasury FY
2021 (OIG-CA-21-006, 10/29/2020)
FINANCIAL MANAGEMENT: Audit of the Department of the Treasury’s Schedules of
United States Gold Reserves Held by Federal Reserve Banks as of September 30,
2020 and 2019 (OIG-21-004, 11/2/2020)
FINANCIAL MANAGEMENT: Audit of the Federal Financing Bank’s Financial
Statements for Fiscal Years 2020 and 2019 (OIG-21-005, 11/12/2020)
FINANCIAL MANAGEMENT: Audit of the Community Development Financial
Institutions Fund's Financial Statements for Fiscal Years 2020 and 2019 (OIG-21-006,
11/13/2020)
FINANCIAL MANAGEMENT: Management Letter for the Audit of the Community
Development Financial Institutions Fund’s Financial Statements for Fiscal Years 2020
and 2019 (OIG-21-007, 11/13/2020)
FINANCIAL MANAGEMENT: Audit of the Gulf Coast Ecosystem Restoration Council’s
Financial Statements for Fiscal Years 2020 and 2019 (OIG-21-008, 11/16/2020)
INFORMATION TECHNOLOGY: Department of the Treasury Federal Information
Security Modernization Act Fiscal Year 2020 Performance Audit (OIG-21-009,
11/30/2020) Sensitive But Unclassified, Not Publicly Disclosed
INFORMATION TECHNOLOGY: Department of the Treasury Federal Information
Security Modernization Act Fiscal Year 2020 Performance Audit for the Collateral
National Security Systems (OIG-21-010, 11/30/2020) Sensitive But Unclassified, Not
Publicly Disclosed
CIGIE FAEC Inspectors General Guide to Compliance under the DATA Act
(OIG-CA-21-008, 12/4/2020)
FINANCIAL MANAGEMENT: Audit of the United States Mint’s Financial Statements
for Fiscal Years 2020 and 2019 (OIG-21-011, 12/8/2020)
FINANCIAL MANAGEMENT: Management Letter for the Audit of the United States
Mint’s Financial Statements for Fiscal Years 2020 and 2019 (OIG-21-012, 12/8/2020)
Treasury Office of Inspector General Semiannual Report—March 2021 45
Statistical Summary
FINANCIAL MANAGEMENT: Audit of the Office of D.C. Pensions' Financial
Statements for Fiscal Years 2020 and 2019 (OIG-21-013, 12/9/2020)
FINANCIAL MANAGEMENT: Management Letter for the Audit of the Office of D.C.
Pensions' Financial Statements for Fiscal Years 2020 and 2019 (OIG-21-014,
12/9/2020)
State of Iowa’s Noncompliance with Uses of Coronavirus Relief Fund (OIG-CA-21-011,
12/14/2020)
FINANCIAL MANAGEMENT: Audit of the Department of Treasury Forfeiture Fund's
Financial Statements for Fiscal Years 2020 and 2019 (OIG-21-015, 12/15/2020)
FINANCIAL MANAGEMENT: Audit of the Alcohol and Tobacco Tax and Trade Bureau's
Financial Statements for Fiscal Years 2020 and 2019 (OIG-21-016, 12/15/2020)
FINANCIAL MANAGEMENT: Management Letter for the Audit of the Alcohol and
Tobacco Tax and Trade Bureau's Financial Statements for Fiscal Years 2020 and 2019
(OIG-21-017, 12/15/2020)
FINANCIAL MANAGEMENT: Audit of the Office of the Comptroller of the Currency's
Financial Statements for Fiscal Years 2020 and 2019 (OIG-21-018, 12/18/2020)
FINANCIAL MANAGEMENT: Audit of the Department of the Treasury's Consolidated
Financial Statements for Fiscal Years 2020 and 2019 (OIG-21-019, 12/30/2020)
FINANCIAL MANAGEMENT: Management Letter for the Audit of the Department of
the Treasury's Consolidated Financial Statements for Fiscal Years 2020 and 2019
(OIG-21-020, 12/30/2020)
Quarterly Summary Memorandum for the Lead Inspector General, Department of
Defense: Operation Inherent Resolve - Summary of Work Performed by the Department
of the Treasury Related to Terrorist Financing, ISIS, and Anti-Money Laundering for
First Quarter Fiscal Year 2021 (OIG-CA-21-012, 1/4/2021)
Letter to Robert Fairweather, Acting Director, Office of Management and Budget:
Annual Report on the Status of the Gulf Coast Ecosystem Restoration Council’s
Implementation of Purchase and Travel Card Audit Recommendations
(OIG-CA-21-013, 1/26/2021)
Treasury Office of Inspector General Semiannual Report—March 2021 46
Statistical Summary
Letter to Robert Fairweather, Acting Director, Office of Management and Budget:
Annual Report on the Status of the Department of the Treasury’s Implementation of
Purchase and Travel Card Audit Recommendations (OIG-CA-21-014, 1/26/2021)
Memorandum for the Honorable Richard K. Delmar, Treasury Deputy Inspector
General: Joint Purchase and Integrated Card Violation Report (April 1, 2020–
September 30, 2020) (OIG-CA-21-015, 2/1/2021) Internal Memorandum, Not Publicly
Disclosed
FINANCIAL MANAGEMENT: Management Report for the Audit of the Department of
the Treasury’s Consolidated Financial Statements for Fiscal Years 2020 and 2019
(OIG-21-021, 2/2/2021)
Whistleblower Referrals to the Department of the Treasury Office of Inspector General,
Office of Investigations. (OIG-CA-21-016, 2/5/2021) Please read in conjunction with
report number OIG-20-046.
Addendum to the Referral for Investigation: Potential Conflicts of Interest and
Improprieties Between Wisconsin-based Administrator of Department of the Treasury’s
Financial Assistance Programs and Beneficiary Company (OIG-CA-21-017, 2/9/2021)
Not Publicly Disclosed
State of Rhode Island's Uses of Coronavirus Relief Fund Payment (OIG-CA-21-018,
2/11/2021)
FINANCIAL MANAGEMENT: Audit of the Bureau of Engraving and Printing’s Financial
Statements for Fiscal Years 2020 and 2019 (OIG-21-022, 2/12/2021)
FINANCIAL MANAGEMENT: Management Letter for the Audit of the Bureau of
Engraving and Printing’s Financial Statements for Fiscal Years 2020 and 2019
(OIG-21-023, 2/12/2021)
Department of the Treasury Office of Inspector General Coronavirus Relief Fund
Frequently Asked Questions Related to Reporting and Recordkeeping
(OIG-CA-20-028R, 3/2/2021) Revised Frequently Asked Questions, Replaced
OIG-CA-20-028.
FINANCIAL MANAGEMENT: Audit of the Exchange Stabilization Fund's Financial
Statements for Fiscal Year 2020 and 2019 (OIG-21-024, 3/10/2021)
CRF Prime Recipient Desk Reviews (OIG-CA-21-004R, 3/22/2021) Revised for
Updated Guidance.
Treasury Office of Inspector General Semiannual Report—March 2021 47
Statistical Summary
Interim Audit Update – Air Carrier and Contractor Certifications for Payroll Support
Program (OIG-21-025, 3/31/2021)
Council of Inspectors General on Financial Oversight
2020 CIGFO Presidential Transition Handbook (12/10/2020)
Treasury Office of Inspector General Semiannual Report—March 2021 48
Statistical Summary
Audit Reports Issued With Questioned Costs
October 1, 2020 through March 31, 2021
Total Total
Total No. Questioned Unsupported
Category of Reports Costs Costs
For which no management decision had been made by
beginning of reporting period 2 $93,427,202 $93,424,652
Which were issued during the reporting period 0 $0 $0
Subtotals 2 $93,427,202 $93,424,652
For which a management decision was made during the
reporting period 1 $93,424,652 $93,424,652
Dollar value of disallowed costs 1 $3,525,178 $3,525,178
Dollar value of costs not disallowed 1 $89,899,474 $89,899,474
For which no management decision was made by the
end of the reporting period 1 $2,550 $0
For which no management decision was made within 6
months of issuance 1 $2,550 $0
Questioned costs include expenditures: (1) that are questioned because of an alleged violation of a provision of a
law, regulation, contract, or other requirement governing the expenditure of funds; (2) that, at the time of the
audit, are not supported by adequate documentation (i.e., unsupported costs); or (3) used for the intended
purpose that are unnecessary or unreasonable.
Treasury Office of Inspector General Semiannual Report—March 2021 49
Statistical Summary
Audit Reports Issued With Recommendations that Funds Be Put
to Better Use
October 1, 2020 through March 31, 2021
Total
No. of Revenue
Category Reports Total Savings Enhancement
For which no management decision had been
made by beginning of reporting period 0 $0 $0 $0
Which were issued during the reporting
period 0 $0 $0 $0
Subtotals 0 $0 $0 $0
For which a management decision was made
during the reporting period 0 $0 $0 $0
Dollar value of recommendations agreed to
by management 0 $0 $0 $0
Dollar value based on proposed
management action 0 $0 $0 $0
Dollar value based on proposed
legislative action 0 $0 $0 $0
Dollar value of recommendations not
agreed to by management 0 $0 $0 $0
For which no management decision was
made by the end of the reporting period 0 $0 $0 $0
For which no management decision was
made within 6 months of issuance 0 $0 $0 $0
A recommendation that funds be put to better use denotes funds could be used more efficiently if management took
actions to implement and complete the recommendation including: (1) reduction in outlays; (2) de-obligations of
funds from programs or operations; (3) costs not incurred by implementing recommended improvements related to
operations; (4) avoidance of unnecessary expenditures noted in pre-award review of contract or grant agreements;
(5) any other savings which are specifically identified; or (6) enhancements to revenues of the Federal Government.
Treasury Office of Inspector General Semiannual Report—March 2021 50
Statistical Summary
Reports for Which No Management Comment was Returned
Within 60 Days
As of March 31, 2021
There were no such reports issued for comment over 60 days as of the end of the
reporting period.
Reports Issued Over 6 Months for Which No Management
Decision Has Been Made
As of March 31, 2021
There was one report as of the end of this reporting period with no management
decision, RESOURCE MANAGEMENT: Audit of the Department of the Treasury
Departmental Offices Executive Pay Adjustment, Bonuses, and Awards, OIG-20-027,
issued on February 5, 2020, with $2,550 in questioned cost. Management agreed
with our recommendations, but has not entered the planned corrective actions in the
audit follow-up system, JAMES, to address the 10 recommendations made in the
report.
Significant Revised Management Decisions
October 1, 2020 through March 31, 2021
There were no significant revised management decisions during the reporting period.
Significant Disagreed Management Decisions
October 1, 2020 through March 31, 2021
There were no significant disagreed management decisions during the reporting period.
Treasury Office of Inspector General Semiannual Report—March 2021 51
Statistical Summary
Peer Reviews
October 1, 2020 through March 31, 2021
Office of Audit
Audit organizations that perform audits and attestation engagements of Federal
Government programs and operations are required by generally accepted government
auditing standards to undergo an external peer review every 3 years. The objectives of
an external peer review are to determine, during the period under review, whether the
audit organization was complying with its quality control system to provide the audit
organization with reasonable assurance that it was conforming to applicable
professional standards. Federal audit organizations can receive a peer review rating of
Pass, Pass with Deficiencies, or Fail.
The most recent peer review of our office was performed by the Department of
Education (Education) OIG. In its report dated September 24, 2018, Education OIG
rendered a Pass rating for our system of quality control in effect for the year ended
March 31, 2018. External audit peer review reports of our office are available on
Treasury OIG’s website. The U.S. Department of Health & Human Services OIG is
performing a peer review of our Office of Audit for the period April 1, 2018 through
March 31, 2021. The review was ongoing as of the end of this semiannual reporting
period. OIG did not perform any peer reviews of other Federal audit organizations
during this reporting period.
Office of Investigations
Council of the Inspectors General on Integrity and Efficiency (CIGIE) mandates that the
investigative law enforcement operations of all OIGs undergo peer reviews every
3 years to ensure compliance with (1) CIGIE’s investigations quality standards and
(2) the relevant guidelines established by the Office of the Attorney General of the
United States.
In its report dated January 5, 2021, the Federal Housing Finance Agency OIG found
our office to be in compliance with all relevant guidelines for fiscal year 2020.
Treasury Office of Inspector General Semiannual Report—March 2021 52
Other Reporting Requirements and Requests
This section addresses certain reporting requirements of our office that are separate
from the reporting requirements in the Inspector General Act of 1978 (as amended).
Reviews of Bank Failures with Nonmaterial Losses
We conduct reviews of failed banks supervised by the Office of the Comptroller
of the Currency (OCC) with losses to the Federal Deposit Insurance
Corporation’s (FDIC) Deposit Insurance Fund (DIF) that do not meet the
definition of a material loss in the Federal Deposit Insurance Act. The reviews
are performed to fulfill the requirements found in 12 U.S.C. §1831o(k). The
term “material loss” triggers a material loss review if a loss to the DIF exceeds
$50 million (with provisions to increase that trigger to a loss that exceeds
$75 million under certain circumstances). For losses that are not material, the
Federal Deposit Insurance Act requires that each 6-month period, the Office of
Inspector General (OIG) of the Federal banking agency must (1) identify the
estimated losses that have been incurred by the DIF during that 6-month period
and (2) determine the grounds identified by the failed institution’s regulator for
appointing the FDIC as receiver, and whether any unusual circumstances exist
that might warrant an in-depth review of the loss. For each 6-month period, we
are also required to prepare a report to the failed institutions’ regulator and the
Congress that identifies (1) any loss that warrants an in-depth review, together
with the reasons why such a review is warranted and when the review will be
completed; and (2) any losses where we determine no in-depth review is
warranted, together with an explanation of how we came to that determination.
There were no banks supervised by OCC that failed during this reporting period.
Operation Inherent Resolve Quarterly Summary Memorandums to the
Department of Defense OIG
During this reporting period, we issued two summary memorandums to the
Department of Defense OIG regarding information we obtained on the
Department of the Treasury’s (Treasury or the Department) activities with
respect to disrupting the Islamic State of Iraq and Syria’s (ISIS) finances. The
memorandums included specific examples of activities to disrupt ISIS’s
financing, information on Treasury programs that combat terrorist financing, and
work we performed or plan to perform to review these programs.
(OIG-CA-21-001, OIG-CA-21-012)
Treasury Office of Inspector General Semiannual Report—March 2021 53
Other Reporting Requirements and Requests
Annual Reports on the Status of Implementation of Purchase and
Travel Card Audit Recommendations
We provided annual reports on the progress made by Treasury and by the
Council in implementing charge card related audit recommendations in
accordance with the Charge Card Act and OMB Memorandum M-13-21,
“Implementation of the Government Charge Card Abuse Prevention Act of
2012” (M-13-21). Our office has issued two charge card related audit findings
and recommendations to Treasury. Our office has not issued any charge card
related audit findings and recommendations to the Council. (OIG-CA-21-013,
OIG-CA-21-014)
Whistleblower Referrals to the Department of the Treasury Office of
Inspector General, Office of Investigations
We issued a memorandum to OCC clarifying comments made in Audit Report
OIG-20-046, Prior to 2015, OCC Missed Opportunities to Analyze and Address
Inappropriate Sales Practices at Wells Fargo Bank, issued September 28, 2020.
In the report, we encouraged OCC to continue to provide whistleblower referrals
to the Treasury OIG’s Office of Investigations (OI) to further support OIG’s
investigative process.
The memorandum clarified the types of referrals that OCC should send to OI
and asked that OCC cease forwarding whistleblower referrals of alleged
misconduct by bank employees of OCC-regulated entities to OI. OCC should
continue to send allegations of OCC employee misconduct and Orders of
Investigation to OI. (OIG-CA-21-016)
Treasury Office of Inspector General Semiannual Report—March 2021 54
References to the Inspector General Act
Section Requirement Page
Section 4(a)(2) Review of legislation and regulations 21
Section 5(a)(1) Significant problems, abuses, and deficiencies 7-18
Section 5(a)(2) Recommendations with respect to significant problems, abuses, and deficiencies 7-18
Section 5(a)(3) Significant unimplemented recommendations described in previous semiannual 22-40
reports
Section 5(a)(4) Matters referred to prosecutive authorities 21
Section 5(a)(5) Summary of instances where information was refused 41
Section 5(a)(6) List of audit reports 42-46
Section 5(a)(7) Summary of significant reports 7-18
Section 5(a)(8) Audit reports with questioned costs 47
Section 5(a)(9) Recommendations that funds be put to better use 48
Section Summary of each audit, inspection, and evaluation report issued before the 49
5(a)(10)(A) beginning of the reporting period for which no management decision was made
Section Summary of each audit, inspection, and evaluation report issued for which no 49
5(a)(10)(B) management comment was returned within 60 days
Section Summary of each audit, inspection, and evaluation report issued before the 22-40
5(a)(10)(C) beginning of the reporting period for which there are outstanding unimplemented
recommendations, including the aggregate potential cost savings
Section Significant revised management decisions made during the reporting period 49
5(a)(11)
Section Management decisions with which the Inspector General is in disagreement 49
5(a)(12)
Section Instances of unresolved Federal Financial Management Improvement Act 10
5(a)(13) noncompliance
Section Results of peer reviews conducted of Treasury OIG by another OIG 50
5(a)(14)
Section List of outstanding recommendations from peer reviews 50
5(a)(15)
Section List of peer reviews conducted by Treasury OIG, including a list of outstanding 50
5(a)(16) recommendations from those peer reviews
Section Statistics for the period related to the number of (A) investigative reports issued, 21
5(a)(17)(A-D) (B) persons referred to the Department of Justice for criminal prosecution,
(C) persons referred to state and local authorities for criminal prosecution, and
(D) criminal indictments/informations
Section Description of metrics used to develop investigative statistics in Section 5(a)(17) 21
5(a)(18)
Section 5a(19) Summary of each investigation involving a senior Government employee where 40-41
allegation of misconduct was substantiated
Section 5a(20) Instances of whistleblower retaliation 41
Section 5a(21) Summary of attempts to interfere with Treasury OIG independence 41
Section Description of each inspection, evaluation, and audit that was closed and not 42-46
5a(22)(A) publicly disclosed
Section Description of each investigation closed, involving a senior Government employee, 40-41
5a(22)(B) that was not publicly disclosed
Section 5(d) Serious or flagrant problems, abuses, or deficiencies N/A
Section 6(b)(2) Report to Secretary when information or assistance is unreasonably refused 41
Treasury Office of Inspector General Semiannual Report—March 2021 55
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Abbreviations
BEP Bureau of Engraving and Printing
BLSR Baseline Security Requirements
CARES Act Coronavirus Aid, Relief, and Economic Security Act
CDFI Community Development Financial Institutions
CIGIE Council of the Inspectors General on Integrity and Efficiency
Council Gulf Coast Ecosystem Restoration Council
COVID-19 Coronavirus Disease 2019
CRF Coronavirus Relief Fund
DASHR/CHCO Office of the Deputy Assistant Secretary for Human
Resources and Chief Human Capital Officer
DATA Act Digital Accountability and Transparency Act of 2014
DO Departmental Offices
DIF Deposit Insurance Fund
ERA Emergency Rental Assistance
ERA1 or ERA2 Emergency Rental Assistance programs
FFMIA Federal Financial Management Improvement Act of 1996
Fiscal Service Bureau of the Fiscal Service
FISMA Federal Information Security Modernization Act of 2014
IRS Internal Revenue Service
KPMG KPMG LLP
Mint United States Mint
NIST SP 800-53, Rev. 4 National Institute of Standards and Technology Special
Publication 800-53 Revision 4, “Security and Privacy
Controls for Federal Information Systems and Organizations”
OCC Office of the Comptroller of the Currency
OER Office of Executive Resources
OFAC Office of Foreign Assets Control
OIG Office of Inspector General
OI Office of Investigations
OMB Office of Management and Budget
OPM Office of Personnel Management
PIR Payment Information Repository
PSP Payroll Support Program
RESTORE Act Resources and Ecosystems Sustainability, Tourist
Opportunities, and Revived Economies of the Gulf Coast
States Act of 2012
RMA RMA Associates, LLC
SBLF Small Business Leading Fund
SES Senior Executive Service
Treasury Office of Inspector General Semiannual Report—March 2021 57
Abbreviations
SOP standard operating procedures
SPS Security Payment System
STIG Security Technical Implementation Guide
SSBCI State Small Business Credit Initiative
TIGTA Treasury Inspector General for Tax Administration
TD P 85-01 Treasury Directive Publication 85-01, “Department of the
Treasury Information Technology Security Program”
TFFC Office of Terrorist Financing and Financial Crimes
Treasury or
the Department Department of the Treasury
TWAI Treasury Web Application Infrastructure
USAO U.S. Attorney’s Office
Treasury Office of Inspector General Semiannual Report—March 2021 58
Pictured above is the Bell Entrance of the Treasury Building, Washington D.C.
Source: Treasury Graphics
Treasury Office of Inspector General Locations
1500 Pennsylvania Avenue, N.W., Room 4436
Washington, DC 20220
875 15th Street, N.W., Suite 200
Washington, DC 20005
408 Atlantic Avenue, Room 330
Boston, Massachusetts 02110
Report Waste, Fraud, and Abuse
Submit a complaint regarding Treasury OIG Treasury Programs and Operations and Gulf Coast
Restoration using our online form: https://oig.treasury.gov/report-fraud-waste-and-abuse
Treasury Whistleblower Ombudsman
For information about whistleblowing and reprisal and about your rights and responsibilities as a
Treasury employee or contractor, please contact the OIG Whistleblower Ombudsman Program at
202-927-0650 or Email: OIGCounsel@oig.treas.gov
Treasury OIG Website
Access Treasury OIG reports and other information online: https://oig.treasury.gov/
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