WA auditors sift through waves of federal dollars for fraud
“We’re dealing with billions of dollars here,” she said. “We nearly doubled federal state spending in 2021.”
Before the pandemic, Washington was spending about $18 billion in federal money each year, according to a recent report. Federal support jumped to about $36.5 billion last year, completely changing the scope of required audits.
The state auditor’s office typically works on government spending to ensure that officials have properly accounted for their expenses and used the money as authorized. Auditors monitor approximately 2,300 different agencies and governments across the state, ranging from the city of Seattle to rural graveyard tax districts, issuing public reports on spending practices and any violations.
“We are the eyes,” Armijo said. “We’re looking to make sure that within your community, within your state, that the money is used for the right purposes and that it’s used for the right reasons. Does it get to the people who need the service?”
With several federal stimulus bills urgently distributing money directly to states, cities, programs and projects, government officials have had to navigate complex — and sometimes changing — spending rules. Many small governments are facing their first audit of federal funds. And there’s even more money on the way.
“Anytime you have a huge amount of money coming out,” Armijo said, “…you’re going to have an increase in fraud.”
Growing demands have sometimes stretched audit staff and triggered back-ups on reporting schedules. The state auditor’s office has asked the legislature for an additional $1.4 million to help cover the glut of new work, including about 12,000 additional staff hours for auditing state-level agencies alone. ‘State.
Without additional support, the auditor’s office would have to cancel or delay its oversight of high-risk transactions in some state agencies when that review is most needed. Although Armijo said she has yet to see an alarming increase in fraud, given the amount of money moving through, she expects it will be waiting to be discovered.
“In my mind, it’s a little worrying that we don’t see more fraud being reported to us,” she admitted. “But we still anticipate that we’re going to see more.”