January 25, 2022

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Texan sentenced in CARES Act unemployment fraud scheme

7 min read
A 29-year-old Corpus Christi man has been ordered to federal prison after he admitted to devising a scheme to fraudulently misappropriate $255,052 in unemployment benefits meant for those suffering financial hardship due to the COVID-19 pandemic

Read full article at: https://www.justice.gov May 4, 2021

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  • Three Florida Men Charged in $46 Million Health Care Fraud, Kickback, and Money Laundering Conspiracy
    In Crime News
    Three telemarketing company owners were charged for their alleged participation in a $47 million health care fraud, kickback, and money laundering scheme involving the referral of medically unnecessary cancer genetic tests to labs in exchange for kickbacks.
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  • Department Press Briefing – April 23, 2021
    In Crime Control and Security News
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  • Natural Disasters: Economic Effects of Hurricanes Katrina, Sandy, Harvey, and Irma
    In U.S GAO News
    Between January 1980 and July 2020, the United States experienced 273 climate and weather disasters causing more than $1 billion in damages each, according to NOAA. The total cost of damages from these disasters exceeded $1.79 trillion, with hurricanes and tropical storms accounting for over 50 percent of these damages, according to NOAA. Across the regions affected by these hurricanes over the period from 2005 to 2015, CBO estimated that federal disaster assistance covered, on average, 62 percent of the damage costs. GAO has reported that the rising number of natural disasters and reliance on federal disaster assistance is a key source of federal fiscal exposure. GAO was asked to review the costs of natural disasters and their effects on communities. This report examines (1) estimates of the costs of damages caused by hurricanes and hurricanes' effects on overall economic activity and employment in the areas they affected, and (2) actions subsequently taken in those areas to improve resilience to future natural disasters. GAO conducted case studies of Hurricanes Katrina, Sandy, Harvey, and Irma, selected for two reasons. First, they were declared a major disaster by the President under the Robert T. Stafford Disaster Relief and Emergency Assistance Act, which establishes key programs through which the federal government provides disaster assistance, primarily through FEMA. Second, they had sizable effects on the 50 U.S. states and the District of Columbia during the period from 2004 through 2018. GAO analyzed federal agency and other data on costs, economic activity, employment, and recovery and mitigation projects in selected areas affected by these hurricanes. GAO also visited selected recovery and mitigation project sites; interviewed experts and federal, state, and local government officials; and reviewed federal, state, and local government reports and academic studies. Hurricanes Katrina, Sandy, Harvey, and Irma (selected hurricanes) caused costly damages and challenges for some populations in affected communities. In these communities, the National Oceanic and Atmospheric Administration (NOAA) estimated the cost of damages to be approximately $170 billion for Katrina, $74 billion for Sandy, $131 billion for Harvey, and $52 billion for Irma. These estimates include the value of damages to residential, commercial, and government or municipal buildings; material assets within the buildings; business interruption; vehicles and boats; offshore energy platforms; public infrastructure; and agricultural assets. These hurricanes were also costly to the federal government. For example, in 2016, the Congressional Budget Office (CBO) estimated that federal spending exceeded $110 billion in response to Katrina and $53 billion in response to Sandy. GAO analysis suggests that the selected hurricanes were associated with widely varying effects on overall economic activity and total employment in affected metropolitan areas and counties. Economic activity was lower than expected in the month of the hurricane or some of the three subsequent months in three of the affected metropolitan areas GAO analyzed. Within one year, average economic activity in these three metropolitan areas was similar to or greater than what it had been the year before the hurricane. Total employment was lower than expected in the month of the hurricane or some of the three subsequent months in 80 of the affected counties GAO analyzed. Total employment was higher than pre-hurricane employment on average in 47 of those counties within one year but remained below pre-hurricane employment on average in the other 33 counties for at least one year. Finally, state and local government officials said that the selected hurricanes had significant impacts on communities, local governments, households, and businesses with fewer resources and less expertise, and that challenges faced by households may have impacted local businesses. Communities affected by selected hurricanes have been taking actions to improve resilience, but multiple factors can affect their decisions. Actions taken after selected hurricanes include elevating, acquiring, and rehabilitating homes; flood-proofing public buildings; repairing and upgrading critical infrastructure; constructing flood barriers; and updating building codes. A community’s decision to take resilience actions can depend on the costs and benefits of those actions to the community. Multiple factors affect these costs and benefits, including the likelihood, severity, and location of future disasters, as well as the amount of federal assistance available after a disaster. Finally, vulnerabilities remain in areas affected by selected hurricanes. For example, state and local government officials indicated that many older homes in these areas do not meet current building codes. In reports to the Federal Emergency Management Agency (FEMA), states indicate they anticipate that the scope of damages via exposure to weather hazards, such as hurricanes, will likely remain high and could expand across regions affected by the selected hurricanes. In addition, some local governments have projected that population will grow in the regions affected by selected hurricanes. For more information, contact Oliver Richard at 202-512-8424 or richardo@gao.gov.
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  • Defenders Navigate Uncharted Territory During Pandemic
    In U.S Courts
    Working on the front lines of justice amid the pandemic, federal defenders are navigating uncharted territory as they work to maintain virtual access to clients in detention facilities and participate in socially distanced trials and hearings.
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  • Technology Modernization Fund: Implementation of Recommendations Can Improve Fee Collection and Proposal Cost Estimates
    In U.S GAO News
    What GAO Found The Technology Modernization Fund (TMF) provides awards to agencies to, among other things, modernize aging federal information systems. Of the initial $175 million that Congress appropriated for TMF, the Technology Modernization Board had approved 11 projects totaling about $89 million (see table), as of August 2021. Agency proposals were to include estimates of any project-related savings; agencies could use these savings to satisfy the requirement that they reimburse the TMF for any transfers within 5 years. For the seven projects approved in 2018 and 2019, two have reported generating cost savings but those savings are not documented. For the remaining five projects, two no longer plan on savings, two plan on savings starting in 1 to 3 years, and one does not know when savings will begin. Technology Modernization Fund (TMF) Project Awards, as of August 31, 2021 (in dollars) Agency and TMF project Total award amount Date of award Department of Agriculture (Agriculture) Farmers.Gov Portal 4,000,000 June 7, 2018 Department of Energy Enterprise Cloud Email 3,743,702 June 7, 2018 Department of Housing and Urban Development Unisys Migration 13,850,013 June 7, 2018 Agriculture Infrastructure Optimization 500,000 October 29, 2018 Department of Labor (Labor) Visa Application Transformation 3,500,000 October 29, 2018 General Services Administration (GSA) Application Modernization 9,816,833 October 29, 2018 GSA NewPay 16,986,021 February 11, 2019 Agriculture Specialty Crops Systems Modernization 8,000,000 October 21, 2019 U.S. Equal Employment Opportunity Commission Charge and Case Management System Modernization 4,000,000 October 21, 2019 U.S. Customs Border and Protection Automated Commercial Environment Collections Module 15,000,000 July 27, 2020 Labor Data Modernization 9,600,000 March 21, 2021 Total 88,996,569   Source: GAO analysis of agency TMF project documentation as of August 31, 2021. | GAO-22-105117 In March 2021, the American Rescue Plan Act of 2021 appropriated an additional $1 billion to the TMF. In May 2021, the Office of Management and Budget (OMB) provided updated TMF guidance to agencies regarding this $1 billion. Among other things, the guidance (1) prioritizes projects that cut across agencies and address immediate cybersecurity gaps, and (2) allows agencies to apply for a partial or minimal reimbursement of the TMF funds provided (partial is agencies repaying 25 to 100 percent of the award while minimal is greater than zero but less than 25 percent). On September 30, 2021, the General Services Administration (GSA) announced the approval of seven new projects with awards totaling at least $311 million (one of the seven projects is classified; no award figure is publicly available). In deciding on these seven, the Technology Modernization Board received 113 project proposals requesting a total of more than $2.3 billion. Regarding TMF operating costs and fees collected to offset those costs, as of August 2021, GSA had received fee payments totaling about $810,000, or about 29 percent of its operating expenses of $2.8 million (see table below). Technology Modernization Fund (TMF) Program Management Office Operating Expenses and Fee Collection, as of August 31, 2021 (in dollars) Fiscal year Operating expenses Fee collection 2018 408,662 0 2019 851,958 33,165 2020 835,725 245,096 2021a 712,170 530,628 Total 2,808,515 808,889 Source: GAO analysis of TMF Program Management Office and TMF project documentation, | GAO-22-105117 a2021 operating expenses and fee collection are for the first 11 months of fiscal year 2021 (Oct-Sept). A key reason for this shortfall is that six of the seven initially approved projects narrowed their scopes. This led to reduced award amounts transferred to agencies, which in turn resulted in about a $1.12 million reduction in anticipated fees. Relatedly, OMB and GSA have not yet implemented GAO's prior recommendation to develop and implement a plan to fully recover operating expenses with fee collection. Doing so would provide greater assurance that fees collected would be sufficient to offset operating costs. OMB funding guidelines require projects to include a reliable estimate of any project-related savings. However, most of the TMF projects' reported savings estimates derived from cost estimates continue to be unreliable. Specifically, three of the four projects reviewed did not fully incorporate best practices for a reliable cost estimate, as defined in OMB Circular A-11 (which references GAO's Cost Estimating and Assessment Guide ) (see table below). GAO Assessment of Technology Modernization Fund (TMF) Projects' Cost Estimates   Characteristic TMF Project Comprehensive Well-documented Accurate Credible Department of Agriculture Specialty Crops System Modernization Minimally met Minimally met Minimally met Not met Department of Labor Data Modernization Partially met Partially met Partially met Not met U.S. Customs and Border Protection Automated Commercial Environment Collections Module Met Met Substantially met Met U.S. Equal Employment Opportunity Commission Charge and Case Management System Modernization Partially met Minimally met Minimally met Not met Source: GAO analysis of agency TMF cost estimate documentation as of August 31, 2021. | GAO-22-105117 Note: Evidence was provided to satisfy a given characteristic's best practices: Not met = none; minimally met = a small portion; partially met = about half; substantially met = a large portion; met = complete evidence. Given the significant expansion in available TMF funds, it is increasingly important that GSA implement GAO's prior recommendation to improve the instructions for the TMF cost estimate template required of each proposal. Such action would help ensure that the TMF board is reviewing documentation that is complete, accurate, and reliable. Why GAO Did This Study Enacted in 2017, the provisions commonly referred to as the Modernizing Government Technology Act established the TMF in recognition of the challenges in modernizing federal information systems. OMB and GSA administer the TMF, and a Technology Modernization Board comprised of federal IT executives reviews agency project proposals. Pursuant to the law, OMB's 2018 TMF guidance directed agencies with approved projects to reimburse the amounts transferred from the fund and pay a fee, within 5 years of award. Fees were to be based in part on a percentage of award amounts transferred to the agency. GSA uses TMF appropriations to cover its operating expenses, and collects the fees from awarded projects to offset these expenses. The act includes a provision for GAO to report biannually on the TMF. This second TMF report, among other things, (1) identifies the status of the fund and approved projects, (2) determines the TMF's operating costs and fees collected to offset those costs, and (3) assesses the reliability of selected projects' cost saving estimates. GAO identified projects approved for TMF funding and reviewed the extent to which selected projects were generating cost savings. GAO also reviewed OMB and GSA's administrative fund processes, and GSA financial data on TMF operating costs. In addition, GAO analyzed TMF project and supporting cost estimate documentation for the four projects awarded funds between September 2019 and August 2021 and compared its analysis to the characteristics of a reliable cost estimate.
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  • Federal Court Enjoins Maryland Physician Assistant from Prescribing Opioids and Other Controlled Substances
    In Crime News
    A federal court in Maryland permanently enjoined a Baltimore-based physician assistant from prescribing opioids and other controlled substances, the Department of Justice announced today.
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  • Remarks By Assistant Attorney General For National Security John C. Demers On Announcement of Charges Against Russian Military Intelligence Officers
    In Crime News
    Good afternoon.  Today, we announce criminal charges against a conspiracy of Russian military intelligence officers who stand accused of conducting the most disruptive and destructive series of computer attacks ever attributed to a single group.
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  • Department of Justice and Partner Departments and Agencies Conduct Coordinated Actions to Disrupt and Deter Iranian Malicious Cyber Activities Targeting the United States and the Broader International Community
    In Crime News
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  • Acting Attorney General Jeffrey A. Rosen Regarding the Overrunning of the U.S. Capitol Building
    In Crime News
    Acting Attorney General Jeffrey A. Rosen issued the following statement: "The violence at our Nation’s Capitol Building is an intolerable attack on a fundamental institution of our democracy.  From the outset,  the Department of Justice has been working in close coordination with the Capitol Police and federal partners from the Interior Department, the Department of Homeland Security, and the National Guard, as well as the Metropolitan Police and other local authorities.  Earlier this afternoon, the Department of Justice sent hundreds of federal law enforcement officers and agents from the FBI, ATF, and the U.S. Marshals Service to assist the Capitol Police in addressing this unacceptable situation, and we intend to enforce the laws of our land."
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  • West Virginia Woman Sentenced for Willful Retention of Top Secret National Defense Information and International Parental Kidnapping
    In Crime News
    Elizabeth Jo Shirley, of Hedgesville, West Virginia, was sentenced today to 97 months of incarceration for unlawfully retaining documents containing national defense information and 36 months of incarceration for international parental kidnapping. Shirley, 47, pleaded guilty to one count of willful retention of national defense information and one count of international parental kidnapping in July 2020. Shirley admitted to unlawfully retaining a National Security Agency (NSA) document containing information classified at the Top Secret/Secret Compartmented Information (TS/SCI) level relating to the national defense that outlines intelligence information regarding a foreign government’s military and political issues. Shirley also admitted to removing her child, of whom she was the non-custodial parent, to Mexico with the intent to obstruct the lawful exercise of the custodial father’s parental rights.
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  • Secretary Antony J. Blinken at the Toys for Tots Ceremony
    In Crime Control and Security News
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  • Department Press Briefing – September 2, 2021
    In Crime Control and Security News
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  • Maine Man Sentenced for Federal Hate Crime Convictions
    In Crime News
    The Justice Department today announced the sentencing of Maurice Diggins, 36, of Biddeford, Maine, in federal court for his role in a series of racially motivated assaults against black men in Maine.
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  • Former Managing Director and Two Former Loan Officers Plead Guilty for Roles in Widespread Bank-Fraud Scheme
    In Crime News
    The former managing director of residential lending and two former loan officers of a financial institution headquartered in Southfield, Michigan, pleaded guilty to participating in a years-long scheme to originate fraudulent residential-mortgage loans through the bank’s low-documentation Advantage Loan Program.
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  • Rebuilding Iraq: Reconstruction Progress Hindered by Contracting, Security, and Capacity Challenges
    In U.S GAO News
    The Department of Defense (DOD) has relied extensively on contractors to undertake major reconstruction projects and provide support to its deployed forces, but these efforts have not always achieved desired outcomes. Further, the Iraqi government must be able to reduce violence, sustain reconstruction progress, improve basic services, and make a positive difference in the daily lives of the Iraqi people. This statement discusses (1) factors affecting DOD's ability to promote successful acquisition outcomes on its contracts for reconstruction and for support to deployed forces in Iraq, (2) the deteriorating security situation and the capabilities of the Iraqi security forces, and (3) issues affecting the Iraqi government's ability to support and sustain future reconstruction progress. The testimony is based upon our work on Iraq reconstruction and stabilization efforts, DOD contracting activities, and DOD's use of support contractors spanning several years. This work was conducted in accordance with generally accepted government auditing standards.The challenges faced by DOD on its reconstruction and support contracts often reflect systemic and long-standing shortcomings in DOD's capacity to manage contractor efforts. Such shortcomings result from poorly defined or changing requirements, the use of poor business arrangements, the absence of senior leadership and guidance, and an insufficient number of trained contracting, acquisition and other personnel to manage, assess and oversee contractor performance. In turn, these shortcomings manifest themselves in higher costs to taxpayers, schedule delays, unmet objectives, and other undesirable outcomes. For example, because DOD authorized contractors to begin work before reaching agreement on the scope and price of that work, DOD paid millions of dollars in costs that were questioned by the Defense Contract Audit Agency. Similarly, DOD lacks visibility on the extent to which they rely on contractors to support their operations. When senior military leaders began to develop a base consolidation plan, officials were unable to determine how many contractors were deployed and therefore ran the risk of over- or under-building the capacity of the consolidated bases. U.S. reconstruction efforts also continue to be hampered by a security situation that continues to deteriorate. Although the number of trained and equipped Iraqi security forces increased to about 323,000 in December 2006 and more Iraqi Army units have taken the lead for counterinsurgency operations, attacks on coalition and Iraqi security forces and civilians have all increased. Aggregate numbers of trained and equipped Iraqi forces, however, do not provide information on the capabilities and needs of individual units. GAO has made repeated attempts to obtain unit-level Transition Readiness Assessments (TRAs) without success. This information is essential for the Congress to make fully informed decisions in connection with its authorization, appropriations, and oversight responsibilities. As the U.S. attempts to turn over its reconstruction efforts, the capacity of the Iraqi government to continue overall reconstruction progress is undermined by shortfalls in the capacity of the Iraqi ministries, widespread corruption and the inability to fund and execute projects for which funds were previously budgeted. Iraqi government institutions are undeveloped and confront significant challenges in staffing a competent, nonaligned civil service; using modern technology; and managing resources and personnel effectively. For example, according to U.S. officials 20 to 30 percent of the Ministry of Interior staff are "ghost employees" whose salaries are collected by other officials. Further, corruption in Iraq poses a major challenge to building an effective Iraqi government and could jeopardize future flows of needed international assistance. Unclear budgeting and procurement rules have affected Iraq's efforts to spend capital budgets effectively and efficiently, according to U.S. officials. At the Ministry of Oil, for example, less than 1 percent of the $3.5 billion budgeted in 2006 for key enhancements to the country's oil production, distribution, and export facilities, had been spent as of August 2006.
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  • Department Press Briefing – March 5, 2021
    In Crime Control and Security News
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  • Owner of Queens Acupuncture Business Pleads Guilty to Aiding and Assisting the Preparation of a False Tax Return
    In Crime News
    The co-owner of a New York acupuncture business pleaded guilty yesterday to aiding and assisting in the preparation of a false tax return, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.
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  • Secretary Antony J. Blinken and Russian Foreign Minister Sergey Lavrov Remarks to the Press Before Their Meeting
    In Crime Control and Security News
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  • Puerto Rico Electricity: FEMA and HUD Have Not Approved Long-Term Projects and Need to Implement Recommendations to Address Uncertainties and Enhance Resilience
    In U.S GAO News
    As of October 2020, 3 years since the hurricanes destroyed much of Puerto Rico's electricity grid, neither the Federal Emergency Management Agency (FEMA) nor the Department of Housing and Urban Development (HUD) had approved long-term grid recovery projects in Puerto Rico. In 2019, GAO made four recommendations to FEMA and HUD to address identified challenges in rebuilding the electricity grid in Puerto Rico. As of October 2020, FEMA had fully implemented one recommendation and partially implemented two others, while HUD had not implemented its recommendation. Specifically, FEMA established an interagency agreement with the Department of Energy (DOE) to clarify how the agencies would consult on recovery efforts. FEMA had taken actions to partially implement recommendations on improving coordination among federal and local agencies and providing information on industry standards. However, further steps are needed, including finalizing guidance on FEMA's process for approving funding for projects. Regarding HUD, it has not addressed GAO's recommendation to establish time frames and requirements for available funding. Damaged Power Lines in Puerto Rico in November 2017 after Hurricane Maria Until HUD and FEMA implement GAO's recommendations, uncertainty will linger about how and when federal funding for long-term grid recovery will proceed. In particular, it is uncertain how available funding sources will support measures to enhance grid resilience to hurricanes, such as smart grid technology. FEMA officials told GAO that additional funding sources could be used for resilience measures but that this would not be determined until specific projects are submitted to FEMA for approval. Moreover, although FEMA finalized a $10 billion cost estimate for grid repairs in September 2020, several steps remain before FEMA approves funding for projects—a process officials said they were drafting. HUD funding could supplement FEMA funding but, as discussed above, HUD has yet to establish conditions for using these funds and has not established time frames and a plan for issuing this information. According to HUD officials, they plan to publish requirements in the first quarter of fiscal year 2021, but this depends on other factors, such as input from other federal agencies. Further delays in publishing the conditions could contribute to delays in Puerto Rico's ability to initiate grid recovery projects. In 2017, Hurricanes Irma and Maria damaged Puerto Rico's electricity grid, causing the longest blackout in U.S. history. It took roughly 11 months after the hurricanes for power to be restored to all of the customers with structures deemed safe for power restoration. Since electricity service has been restored, local entities have undertaken the longer-term task of more fully repairing and rebuilding the grid. GAO reported in 2019 on challenges hindering progress in rebuilding the grid and recommended that FEMA and HUD take actions to address these challenges. This report examines the status of efforts to support long-term grid recovery in Puerto Rico, including actions taken by FEMA and HUD to implement GAO's 2019 recommendations. For this report, GAO assessed agency actions; reviewed relevant reports, regulations, policies, and documents; and interviewed federal and local officials. GAO previously made three recommendations to FEMA and one to HUD to provide needed information and improve coordination to support grid recovery. Both agencies disagreed with GAO's characterization of their progress made addressing these prior recommendations. GAO continues to believe additional actions are needed to fully implement these recommendations. For more information, contact Frank Rusco at (202) 512-3841 or ruscof@gao.gov.
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  • VA Disability Benefits: VA Should Continue to Improve Access to Quality Disability Medical Exams for Veterans Living Abroad
    In U.S GAO News
    The number of disability claims for veterans living abroad—in foreign countries or U.S. territories—increased 14 percent from fiscal years 2014 to 2019. During this time period, claims processing time frames improved. In fiscal year 2019, the Veterans Benefits Administration (VBA) of the Department of Veterans Affairs (VA) approved comparable percentages of disability claims for veterans living abroad and domestically—63 percent and 64 percent respectively. However, for a subset of these claims—those where veterans likely received a disability medical exam scheduled by Department of State (State) embassy staff—approval rates were often lower. Veterans' access to disability medical exams abroad improved as VBA has increasingly relied on contracted examiners, rather than embassy-referred examiners, to conduct these exams. According to VBA, this shift expanded the pool of trained examiners abroad and increased the frequency and depth of VBA's quality reviews for contract exams. These quality reviews help VBA and its contractor identify and address common errors, according to VBA and contractor officials. However, several factors continue to limit some veterans' ability to access quality disability medical exams (see figure). Factors That Impair the Access of Veterans Living Abroad to Quality Disability Medical Exams Unknown quality of certain exams: A subset of veterans living abroad receive disability medical exams from an embassy-referred provider. VBA does not systematically assess the quality of these exams. Without doing so, VBA cannot determine if such exams affect the approval rates of veterans who receive them or contribute to longer processing times and are unable to make informed decisions about their use. Travel reimbursement: Under current VA regulations, VA is not authorized to reimburse veterans for travel expenses for certain services incurred in foreign countries as it is for those incurred within the United States, including U.S. territories. Consequently, some veterans living in foreign countries may be unable to afford to travel to exams. Examiner reimbursement: The Veterans Health Administration's (VHA) Foreign Medical Program reimburses examiners referred by embassy staff via paper checks in U.S. currency. These checks may be slow to arrive and not accepted by foreign banks, according to State and other officials and staff we interviewed. Such payment issues can deter examiners from being willing to conduct disability medical exams and thus limit veterans' access to these exams in foreign countries. Of the roughly 1 million disability claims VBA processed in fiscal year 2019, 18,287 were for veterans living abroad. Veterans living abroad are entitled to the same disability benefits as those living domestically, but GAO previously reported that veterans living abroad may not be able to access disability medical exams as readily as their domestic counterparts. VBA uses medical exam reports to help determine if a veteran should receive disability benefits. GAO was asked to review the disability claims and exam processes for veterans living abroad. Among other things, this report examines disability claims trends for veterans living abroad and these veterans' ability to access quality disability medical exams. GAO analyzed VBA claims data for fiscal years 2014 to 2019; assessed data reliability; reviewed relevant federal laws, regulations, policies, and contract documents; and interviewed employees of VBA, State, and other stakeholders. GAO is making five recommendations, including that VBA assess the quality of embassy-referred exams, VBA and VHA assess whether to reimburse beneficiaries for travel to disability medical exams in foreign countries, and that VBA and VHA pay examiners located by embassy staff electronically. The Department of Veterans Affairs concurred with GAO's recommendations. For more information, contact Elizabeth Curda at (202) 512-7215 or curdae@gao.gov.
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