HARRISBURG – Auditor General Jack Wagner said Friday that, more than one year after he cited the Department of Public Welfare for lax oversight and systemic weaknesses of the state’s Low Income Home Energy Assistance Program that permitted more than 1,000 applicants of potential fraud and abuse, the department still had not provided documentation to prove that the potential for fraud and abuse had been eliminated from LIHEAP.
Wagner called on DPW to provide his auditors with concrete information that shows appropriate steps have been taken to make sure that taxpayer dollars are being protected.
“With the heating season starting, the economy faltering, and natural gas prices significantly higher than they were a year ago, many families will be relying on LIHEAP assistance to keep their homes warm this winter,” Wagner said. “Every dollar that is wasted is a dollar that will not be available to families who need assistance.”
Wagner’s special performance audit of LIHEAP, released in June of 2007, found that inadequate policies and procedures, insufficient supervision, and inadequate oversight resulted in potential applicant and employee fraud and abuse. More than 1,000 applicants of potential fraud and abuse were discovered during the audit of LIHEAP from six counties, including Philadelphia and Allegheny. Auditors found applications containing invalid Social Security numbers or numbers of deceased people, as well as applicants filing multiple applications using different SSNs or different addresses and applicants receiving excessive benefits.
Wagner referred over 900 applications to the Office of Inspector General (OIG) for criminal investigation. OIG has not publically announced results of its investigation. He also made 25 recommendations to DPW for improving LIHEAP, and said that auditors would follow up before the advent of the next heating season to make sure that his recommendations were being implemented.
The Department of the Auditor General contacted DPW in July 2008 to begin its follow-up of the LIHEAP audit. Wagner said his auditors requested a written, detailed summary explaining the status of DPW’s efforts in implementing each of the recommendations. DPW’s secretary sent a letter responding to the request, but failed to provide specific information to address each of the 25 recommendations.
“It has been 16 months since the release of the audit and since July we have made several attempts using various methods to have DPW provide us with evidence that verifies they have implemented all the recommendations made in the report,” Wagner said.
From the limited information provided by DPW, auditors were able to determine that weaknesses still exist related to improving LIHEAP system controls so that every Social Security number entered into the system is valid and associated with a legitimate individual. Wagner added that there is a lack of appropriate checks or controls to the LIHEAP System to detect irregularities or potential fraud and abuse on applications.
“There are serious deficiencies in the administration of LIHEAP and the Department of Public Welfare must provide evidence that they are addressing the problems as soon as possible,” Wagner said.