Office of Investigations
Overview and
Investigative Priorities
January 17, 2024 | Report No. 24-N-0016
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Abbreviations
CSB U.S. Chemical Safety and Hazard Investigation Board
EPA U.S. Environmental Protection Agency
01 Office of Investigations
OIG Office of Inspector General
RINs Renewable Identification Numbers
U.S.C. United States Code
Cover Image
Imagery representing environmental infrastructure and laboratory, grant, and program fraud. (iStock and EPA images)
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Table of Contents
Introduction 1
Investigative Priorities 2
Investigative Priority 1: Environmental Infrastructure 2
Investigative Priority 2: Grant Fraud 3
Investigative Priority 3: Program Fraud 3
Investigative Priority 4: Laboratory Fraud 4
Conclusion 4
Report No. 24-N-0016 i
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Introduction
According to the Inspector General Act of 1978, as amended, 5 U.S.C. §§ 401-424, the mission of the
Office of Inspector General includes preventing and detecting fraud, waste, and abuse related to the
programs and operations of the U.S. Environmental Protection Agency and the U.S. Chemical Safety and
Hazard Investigation Board. The OIG's Office of Investigations is the lead component responsible for
"conducting], supervising], and coordinating] ... investigations relating to the programs and operations
of the [EPA and the CSB.]" 5 U.S.C. § 404(a)(1). The Ol's jurisdiction spans the breadth of the EPA's and
the CSB's work, from integrity of their programs to the expenditure of funds. And, like those entities, the
Ol's geographic area of responsibility spans the United States, including the U.S. territories, from the
Northern Mariana Islands to Maine and from Puerto Rico to Alaska.
The 01 prioritizes criminal, civil, and administrative enforcement, focusing on specific areas where
American taxpayer funds are put at great risk or where the integrity of EPA or CSB programs is
significantly endangered. Criminal enforcement involves investigations of potential violations of federal,
state, and local law punishable by imprisonment and fines. While the Inspector General Act authorizes
the 01 to enforce "any offense against the United States" or "any felony cognizable under the laws of
the United States," it generally focuses on crimes violating the federal fraud, theft, and money
laundering statutes. 5 U.S.C. § 406(f)(1). Civil enforcement involves investigations seeking to remedy
losses resulting from false claims, fraudulent schemes, and public corruption and to compel compliance
with federal laws and regulations. The 01 is especially focused on violations of the False Claims Act,
which allows the OIG and the U.S. Department of Justice to pursue up to treble damages and fines of
over $25,000 per false claim and to pay whistleblowers up to 35 percent of what the government
recovers. For smaller false claims cases, the 01 pursues recovery through the administrative process
provided by the Program Fraud Civil Remedies Act. Finally, administrative enforcement involves
investigations of alleged violations of regulations, rules, and policies, focusing on EPA and CSB
employees and operations. These investigations often conclude with the 01 working with the EPA's
Suspension and Debarment Program to ensure that the Agency is taking appropriate administrative
action to prevent additional fraud, waste, and abuse.
In furtherance of its investigative mission, an OIG special agent is empowered to "carry a firearm while
engaged in official duties," to "make an arrest without a warrant [under circumstances that include]
reasonable grounds to believe that the person ... has committed," and to "seek and execute warrants for
arrest, search of a premises, or seizure of evidence [where there is] probable cause to believe that a
violation has been committed." 5 U.S.C. § 406(f)(1). But one of the most effective tools available to an
OIG special agent is the ability to serve administrative subpoenas, also known as inspector general
subpoenas, to obtain documents related to criminal, civil, or administrative investigations. Finally, the 01
leverages technology and data, engages stakeholders, and builds working relationships with other law
enforcement agencies. For example, the 01 leverages the expertise of the OIG's Data Analytics
Directorate to identify potential violations of law impacting the EPA, the CSB, and the drinking water and
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wastewater sectors. Additionally, the 01 collaborates with other law enforcement agencies and federal
task forces to conduct joint investigations.
Investigative Priorities
The EPA OIG's fiscal year 2024 investigative priorities describe the Ol's primary areas of focus. As a
starting point for identifying its investigative priorities, the 01 looked to the top management and
performance challenges facing the EPA and the CSB, as identified in the OIG's annual reports. The 01 also
considered the Agency's and the Board's missions and the budgetary priorities set forth by Congress;
observations from previous investigative work; emerging vulnerabilities in the drinking and wastewater
sectors; and projects being planned or funded through the American Rescue Plan Act, the Infrastructure
Investment and Jobs Act, and the Inflation Reduction Act. The 01 identified four investigative priorities
for fiscal year 2024: environmental infrastructure, grant fraud, program fraud, and laboratory fraud. Of
course, these investigative priorities are subject to change throughout the fiscal year as new challenges
and risks evolve and emerge.
Investigative Priority 1: Environmental Infrastructure
Associated with EPA top management challenge 7: overseeing, protecting, and investing in the water and wastewater systems.
One of the EPA's most important functions is strengthening and maintaining secure, functioning, and
resilient drinking water and wastewater sectors. Through the clean water state revolving funds and the
drinking water state revolving funds, the EPA has partnered with the states to fund over $200 billion in
water improvement projects using revolving low-cost loans and other financing options. And through
the Water Infrastructure Finance and Innovation Act, the EPA has provided approximately $20 billion in
long-term, low-cost supplemental loans for regionally and nationally significant projects and to state
infrastructure financing authorities. Recently, the Infrastructure Investment and Jobs Act significantly
increased this funding by providing the EPA with approximately $50 billion for the state revolving funds
to, among other things, address aging water infrastructure and emerging contaminants. Additionally,
nearly $6.5 billion of American Rescue Plan Act funds have been obligated for water infrastructure
projects through the state revolving funds. The Ol, therefore, will prioritize investigations into criminal
and civil allegations of fraud or public corruption related to water systems that have received funding
from these programs. These investigations will also focus on subrecipients and contractors who may
engage in bid rigging, substitute building materials, misrepresent the quality of building materials, or
obscure the country of origin for the materials.
The EPA's responsibilities for the drinking water and wastewater sectors go beyond funding and
regulating. Presidential Policy Directive 21, Critical Infrastructure Security and Resilience, designates the
EPA as the agency responsible for the critical water and wastewater infrastructure, requiring that the
EPA ensure that this infrastructure is "secure and able to withstand and rapidly recover from all
hazards," such as "cyber incidents, industrial accidents, pandemics, acts of terrorism, sabotage, and
destructive criminal activity targeting critical infrastructure." Furthermore, America's Water
Infrastructure Act of 2018 requires, among other things, that the EPA provide baseline information on
malevolent acts of relevance to water systems so that covered water systems may assess their risk and
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resilience and prepare emergency response plans. Yet, these sectors remain vulnerable to physical
attacks, cyberattacks, and destructive criminal activity. As part of its mission to protect the integrity of
EPA programs and operations, the 01 will investigate acts that seek to exploit these vulnerabilities.
Furthermore, under the National Infrastructure Protection Plan, the 01 will coordinate and collaborate
with other EPA offices and federal law enforcement partners to detect and prevent threats to the
drinking water and wastewater sectors.
Investigative Priority 2: Grant Fraud
Associated with EPA top management challenge 5: managing grants, contracts, and data systems.
The EPA oversees billions of dollars in grants to fund environmental research, cleanup technologies, land
remediation, and climate change mitigation. Under the Infrastructure Investment and Jobs Act and the
Inflation Reduction Act, the EPA received approximately $100 billion, significantly increasing the size and
scope of these grant programs. For example, the Inflation Reduction Act provides the EPA with
approximately $41.5 billion for significant investments in climate change, air quality, and environmental
justice. Nearly $14 billion of this money will go to two or three nonprofit entities, which will support the
financing of clean technology projects and take equity positions in clean technology companies. The 01
will focus on investigating allegations of fraud related to these programs and their recipients and
subrecipients. For example, the 01 may investigate allegations of bribery, public corruption, bid rigging,
false claims, product substitution, and labor and materials overcharging. Additionally, the 01 will work
proactively to prevent fraud through fraud awareness and education outreach briefings to EPA
employees, grant recipients, tribal leaders, and contractors. These briefings will teach stakeholders to
recognize fraud indicators, the process for reporting potential fraud, and the protections afforded to
whistleblowers who report to the OIG.
investigative Priority 3: Program Fraud
Associated with EPA top management challenges 2, 3, 5, and 6: integrating and implementing environmental justice;
safeguarding the use and disposal of chemicals; managing grants, contracts, and data systems; and maximizing compliance with
environmental laws and regulations.
The OIG, through the 01, is responsible for "conducting], supervising], and coordinating] ...
investigations relating to the programs and operations of the" EPA and the CSB. 5 U.S.C. § 404(a)(1).
These investigations not only serve "to prevent and detect fraud and abuse," but to ensure that EPA and
CSB programs and operations are administered economically, efficiently, and effectively.
See 5 U.S.C. § 402(b). Criminal acts constituting the sort of fraud that meets the OIG's mission are broad,
covering acts "impairing, obstructing or defeating the lawful function of any department of
government," Hass v. Henkel, 216 U.S. 462, 479 (1910), as well as "interfering] with or obstructing] one
of its lawful government functions by deceit, craft or trickery," Hammerschmidt v. United States,
265 U.S. 182, 188 (1924). To borrow from the Department of Justice's Criminal Resource Manual (2020),
the fight against fraud on the United States "not only reaches financial or property loss through use of a
scheme or artifice to defraud but also is designed and intended to protect the integrity of the United
States and its agencies, programs and policies."
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In furtherance of its fraud fighting mission, the 01 will investigate allegations of fraud that put the
integrity of the EPA, the CSB, and their programs and policies at risk. For example, the EPA ensures
compliance with its Renewable Fuel Standard program by assigning Renewable Identification Numbers,
or RINs, to each gallon of biofuel produced. The EPA then regulates and oversees the use or sale of these
RINs, regulating and overseeing annual trade volume of over $30 billion. The 01 will investigate
allegations of fraud that undermine the integrity of the EPA's Renewable Fuel Standard program and the
RINs market, including allegations of falsely certifying fuel production to generate RINs. As another
example, Superfund waste removal, remedial construction, and operational sites use contract work
through technical direction documents for the Superfund Technical Assessment and Response Team and
Emergency and Rapid Response Services contractors. The 01 will investigate allegations of fraud
involving the billing of unnecessary labor and materials, as well as those involving falsely certifying
Superfund site remediation. The 01 will also investigate allegations that potentially responsible parties
concealed, avoided, or decreased their obligation to conduct needed cleanup activities under the EPA's
oversight.
Investigative Priority 4: Laboratory Fraud
Associated with EPA top management challenge 4: promoting ethical conduct and protecting scientific integrity.
Laboratory fraud investigations address laboratory-related misconduct, including fraud related to water
and air quality, Superfund remediation measurements, payments made by the EPA for erroneous
environmental testing data, and falsification of testing results. Investigations also include fraud involving
quality control testing when a contractor or laboratory misrepresents the results of testing to earn
contract incentives, falsely or to avoid operations shutdown, or to increase profits or limit costs.
Laboratory fraud undermines the basis for EPA decision-making, regulatory compliance, and
enforcement actions, potentially wasting program funds and harming human health and the
environment.
Conclusion
The EPA OIG's fiscal year 2024 investigative priorities address the most significant challenges related to
the programs and operations of the EPA and the CSB. These priorities represent the greatest risks to
American taxpayer dollars and the most significant vulnerabilities to the integrity of EPA and CSB
programs and operations. Using data-driven and innovative approaches to fighting fraud, the 01 will,
therefore, focus its investigative activities on these four areas.
Report No. 24-N-0016
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Whistleblower Protection
U.S. Environmental Protection Agency
The whistleblower protection coordinator's role
is to educate Agency employees about
prohibitions against retaliation for protected
disclosures and the rights and remedies against
retaliation. For more information, please visit
the OIG's whistleblower protection webpage.
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