Debt Collection

Billions Are Owed While Collection and Accounting Problems Are Unresolved Gao ID: AFMD-86-39 May 23, 1986

Pursuant to a congressional request, GAO: (1) reviewed selected federal agencies' efforts to implement the Debt Collection Act of 1982 and improve debt collection; and (2) evaluated agency systems that account for debts owed the government.

GAO noted that the largest portion of government debts related to loan programs, such as those for farming, housing, and education and, therefore, it reviewed the practices of the Departments of Education and Housing and Urban Development (HUD), the Farmers Home Administration (FmHA), and the Veterans Administration (VA). GAO found that agencies failed to: (1) consistently make progress in implementing improved debt collection procedures due to management priorities, system capability limitations, management uncertainty, and regulations; (2) report delinquent individual debtors to credit reporting agencies; (3) efficiently use private collection agencies' services; (4) collect delinquent debts by offsetting salaries of, or payments to, federal employees; and (5) assess interest, penalties, or administrative costs on delinquent debts. GAO also found that agencies' accounting systems often failed to provide management with current and accurate information on the status of debts owed to the government.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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