Treasury Announces Enhanced Fraud Detection Processes, Including Machine Learning AI, Prevented and Recovered Over $4 Billion in Fiscal Year 2024

Treasury’s Office of Payment Integrity Began Using Enhanced Processes, including Machine Learning AI, to Deal with Increased Fraud and Improper Payments Since the Pandemic

WASHINGTON – Today, the U.S. Department of the Treasury announced that its latest efforts in taking a technology and data-driven approach to fraud and improper payment prevention enabled the prevention and recovery of over $4 billion in fraud and improper payments this fiscal year (FY) (October 2023 – September 2024), up from $652.7 million in FY23. This increase reflects dedicated efforts by Treasury’s Office of Payment Integrity (OPI), within the Bureau of the Fiscal Service (Fiscal Service) to enhance its fraud prevention capabilities and expand offerings to new and existing customers.

Highlights include:

• Expanding risk-based screening resulting in $500 million in prevention.
• Identifying and prioritizing high-risk transactions resulting in $2.5 billion in prevention.   
• Expediting the identification of Treasury check fraud with machine learning AI resulting in $1 billion in recovery. 
• Implementing efficiencies in payment processing schedule resulting in $180 million in prevention. 

“Treasury takes seriously our responsibility to serve as effective stewards of taxpayer money. Helping ensure that agencies pay the right person, in the right amount, at the right time is central to our efforts,” said Deputy Secretary of the Treasury Wally Adeyemo. “We’ve made significant progress during the past year in preventing over $4 billion in fraudulent and improper payments. We will continue to partner with others in the federal government to equip them with the necessary tools, data, and expertise they need to stop improper payments and fraud.” 

In addition to enhanced capabilities, Treasury is focused on establishing and strengthening partnerships with new and high-risk programs to increase access to and usage of Treasury’s payment integrity solutions, including federally-funded state administered programs. For instance, in May 2024, Treasury and the Department of Labor announced^[1] a data-sharing partnership to provide state unemployment agencies with access to Do Not Pay Working System data sources and services through the Unemployment Insurance Integrity Data Hub. 

As the federal government’s central disbursing agency, Treasury securely disburses approximately 1.4 billion payments valued at over $6.9 trillion dollars to more than 100 million people annually. At a time when losses from fraud in the financial sector continue to rise every year, with online payment fraud expected to cumulatively surpass $362 billion by 2028^[2], Treasury is uniquely positioned to support federal programs proactively mitigate the risk of financial fraud by leveraging data and emerging technologies.

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