Government Fraud

We often hear about business fraud. Most often, however, there are checks and balances in business by boards of directors and independent audits. When an Enron occurs, the publicity and media extravaganzas, along with government finger-pointing and publicity, make up for smaller, relative numbers.

Government fraud is taken for granted but is far more prevalent where politicians and bureaucrats take it as a given because they are so “underpaid” on the job.

An example: There is a formula for how government grants are used. There always is a euphemistic allowance made for “waste.”

And there is always an understatement of projected cost. It’s a rare government project that ever meets its original cost estimates.

Then there is usually some figure allotted to account for missing funds. Or at least a few percentage points devoted for investigation of fraud.

That is because of the psychological nature of government jobs. You don’t have the same checks and balances than in private industry, despite the public image the media provides.

Government projects are always ramped up. Very few are ever terminated. Sunshine laws are passed from time to time but appear ineffectual. Once on the books, laws and agencies they breed have a life of their own.