DHS OIG finds millions of US bailout plan funds misused by NGOs and ‘escaped’ illegal immigrants

The Department of Homeland Security’s Office of the Inspector General found that a portion of the $110 million in America’s rescue plan for migrants encountered at the southern border was misappropriated by nonprofit organizations.

In some cases, it was given to illegal immigrants who had eluded border police.

The report describes how the Federal Emergency Management Agency (FEMA) awarded $110 million in humanitarian assistance funds allocated under ARPA to “provide services to families and individuals encountered by DHS in communities, those most affected by the humanitarian crisis on the south-west border”.

At the time of the audit, $80 million had been awarded to 25 border state organizations, and the IG reviewed $12.9 million in spending.

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The office found that the money was not always used according to guidelines, that organizations failed to provide the required receipts and documentation, and that some failed to provide supporting documentation for those for whom they provided services. It found that 18 groups that received $66 million in grants did not always follow grant and application guidelines.

Organizations had to keep documents about costs, migrants served each day, expenses incurred and proof of payment for purchases. In one sample, IG said 58% of the amount checked was missing documentation.

In addition, it found that some of these migrants did not have DHS encounter files, meaning they had “evaded” illegal immigrants who evaded border patrol agents rather than turning themselves in after the illegal crossing.

IG said that of the 824 names it sampled, 197, or 24%, were not eligible to receive humanitarian services and 154 had no records of encounters.

“These problems arose because FEMA did not adequately oversee the funds, instead relying on local boards and tax representatives to enforce funding and application policies,” the report said. “As a result, FEMA, as chair of the National Board, cannot ensure that the humanitarian assistance funds have been used as provided in the funding and application guidelines.”

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Several Republican lawmakers have raised concerns about the use of non-governmental organizations at the border, noting that such groups spend money improperly and encourage or facilitate illegal immigration.

Amid a historic migrant crisis that has overwhelmed authorities and seen more than 2.3 million encounters in fiscal 2022 alone, migrants are often processed and then released and turned over to NGOs that provide care, services and transportation.

In its report, IG warned that without additional oversight, organizations “could continue to use the funds for services without providing the necessary supporting documentation for reimbursement, increasing the risk of misuse of funds and fraud”.

He made two recommendations related to strengthening oversight and implementing oversight measures for future funds. FEMA agreed with the recommendations and said it has since issued guidance to address the reimbursement of unsupported expenses.

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In a response to the OIG, the agency said it had also introduced quarterly reporting to “provide more visibility and updates on how funds have been spent, reducing risk and increasing transparency”.

It also creates templates for funding requests, provides additional requirements for the definition and clarity of funding guidelines, and establishes a method for random site visits to organizations in addition to other policy steps to verify that funds are being used as intended. These moves are expected to be completed by June 30th.