Feds are not sufficiently assessing fraud risk in Ukrainian aid, watchdog report finds

A federal agency dispersing billions in aid to Ukraine and other conflict-affected countries is not doing enough to guard against fraud, according to a recent Government Accountability Office (GAO) report.

The report, which covers billions in aid to Ukraine, Nigeria, and Somalia disbursed by the United States Agency for International Development (USAID), examined the degree to which federal officials are mitigating and assessing risks in aid operations. The GAO found that the agency “did not comprehensively assess or document, in fraud risk profiles, the relevant fraud risks affecting its assistance” in the three countries.

“As a result, USAID cannot ensure it has identified and is mitigating all relevant fraud risks in these countries,” the report reads.

USAID’s anti-fraud measures do not account for the risk of taxpayer-funded aid being co-opted by corruption or by Ukrainian oligarchs, the GOA claims. The agency justified not incorporating oligarchs or corruption in its risk assessments because its “risk profiles are intended primarily to document risks that it can mitigate.”

USAID has distributed over $2 billion in aid to Ukraine, according to the report.

The GAO recommended that USAID make its assessments of fraud risks more comprehensive, that it update its third-party monitoring practices, and that it develop a mechanism for sharing “lessons learned” regarding risk management in conflict zones to better guard against fraud. USAID referred the Daily Caller News Foundation to a response issued by the agency in which it agrees with the recommendations made by GAO and will work to implement them.

The Biden administration believes perceptions of corruption in the Slavic country could undermine the world’s confidence in its war efforts. Ukrainian officials embezzled roughly $40 million in funds intended to purchase ammunition, according to Ukrainian intelligence authorities regarding a scheme uncovered in December 2023.

The United States has sent approximately $44.3 billion in military aid to Ukraine since Russia launched its invasion in February 2022, according to the State Department. A foreign aid package signed into law by President Joe Biden in April allocated an additional $60.8 billion in security assistance for Ukraine, with the Department of Defense announcing an additional billion in aid for the country shortly after.

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