Fraudsters stand to siphon off $120 billion or more of the federal infrastructure money flowing to states and local governments for roads, bridges, broadband and other projects over the next five years, some experts predict, Stateline reports. At least ten percent of the $1.2 trillion in infrastructure funding could be used fraudulently, estimates Stephen Street of the Association of Inspectors General. “Our experience has always been when you have a large amount of money—and this is pretty gargantuan—there will be an element of fraud built in,” said Street, who is Louisiana’s inspector general. “It will take many forms: false documentation, being reimbursed for monies never spent, phony records.”
While federal agencies ultimately are responsible for how the money gets spent, it will fall to states, cities and counties awarding contracts to oversee everything from the bidding process to the quality of the work, say auditors and watchdog groups. Some watchdogs criticize Congress for failing to include sufficient oversight provisions in the legislation that created the program. Some state and local agencies as well as auditors and inspectors general may lack the resources to oversee the flood of money, experts say. “There are going to be very few agencies that are going to be equipped to do that,” Street said. “This funding needs oversight. There are limited resources to do it. That’s going to potentially make it very difficult to catch all the fraud.” Legislators in at least one state, Connecticut, are considering requiring quarterly reports and hearings on infrastructure spending, and in another, Washington, the state auditor’s office has asked for oversight funding.
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