Navigating the Tension Between Data Sharing and Preventing Fraud
Two recent Executive Orders have highlighted concerns related to effective and safe data sharing and could have impacts for the Law Enforcement community. The March 20th Executive Order (EO) Stopping Waste, Fraud, and Abuse by Eliminating Silos highlights the importance of removing unnecessary barriers to Federal employees accessing government data and promoting interagency data sharing to eliminate duplication and inefficiency and to detect overpayments and fraud. The March 25th EO Protecting America’s Bank Account Against Fraud, Waste, and Abuse, addresses the role of the government to defend against financial fraud and improper payments, through increased transparency and accountability, and to enhance the security of Federal payments. While progress has also been made on developing repositories of shared law enforcement information at the federal, state, and regional levels and on developing common policies, sharing law enforcement information remains complex, and standards for doing so remain insufficient.
There is an inherent tension between data security and effective data sharing to reduce misuse of taxpayer dollars. Digitizing government services to improve customer experience, integrating systems, and sharing data across agencies can be effective tools to improve service delivery, but they also raise concerns about the vulnerability of sensitive personal information. Ensuring a balance between effective data sharing and robust privacy protections is critical to maintaining public trust and ensuring the integrity of government programs.
The National Academy of Public Administration (the Academy)* recently completed a white paper in collaboration with the Program Integrity Alliance to explore the challenges and opportunities within this complex and rapidly evolving space. The white paper addresses these tensions and explores ways to expand data sharing to enhance fraud protection without compromising privacy. Research for this paper included the exploration of examples of centralized data platforms in the oversight community and the experience of the Recovery Operations Center (ROC), a central data analytics service to support fraud detection and prevention and to assist the oversight communities. The data sets collected by the ROC included government, law enforcement, commercial, and open-source data and according to GAO, the ROC provided significant data analytical support to the oversight community. This effort has been used as an example of effective and deliberate data sharing that can strengthen oversight roles and capacity for improved fraud detection, and strengthened interagency collaboration.
Benefits of data sharing do not come without legal barriers and legislative requirements, and the related challenges associated with compliance and implementation, such as Systems of Records Notices (SORN), designed to inform the public about a federal agency's collection and maintenance of personally identifiable information. This important tool for transparency can entail lengthy processes for preparing and drafting a new SORN, and agency approaches can vary significantly.
Another key concept within this issue is the fragmented data management framework and the limits it puts on effective fraud prevention. There are costs associated with creating a culture supportive of these important efforts. The white paper includes legislative, policy, and structural changes along with best practice guidance to strengthen data-sharing initiatives and promote a data-driven fraud prevention approach while protecting privacy.
This white paper highlights the necessity for flexibility to respond to situations where privacy laws hinder agencies’ ability to access data to investigate, detect, and prevent scams and fraud. In such instances, requiring strict compliance with statutory requirements may not be practical or desirable. The study team identified the value of special authorities or statutory exemptions in facilitating data sharing between agencies with an eye towards stronger program integrity and fraud prevention. More systematic reform to overcome cultural and structural barriers and accelerate data sharing across government agencies will drive progress and assist agencies with efforts to reduce fraud.
This research effort demonstrates the need for additional exploration of activities such as establishing options for a centralized data platform to support law enforcement and program integrity efforts and anti-fraud efforts, structuring a new office within the federal government to develop and manage the data platform, and leveraging public-private partnerships. A comprehensive analysis of the strengths and limitations of each option is needed. These measures will only become more consequential as more government data migrates to digital form and data management technologies advance. This increased importance will coincide with the intensified sophistication of the fraudulent activities that challenge law enforcement organizations at all levels of government.
*The National Academy of Public Administration is an independent, nonprofit, and nonpartisan organization established in 1967 to assist government leaders in building more effective, accountable, and transparent organizations. Chartered by Congress to provide nonpartisan expert advice, the Academy's unique feature is its over 1,000 Fellows—including former cabinet officers, Members of Congress, governors, mayors, and state legislators, as well as prominent scholars, business executives, and career public administrators. The Academy helps the federal government address its critical management challenges through in-depth studies and analyses, advisory services and technical assistance, congressional testimony, forums and conferences, and online stakeholder engagement. If you would like to find out more about how the Academy can support your organization, please visit us at www.napawash.org.
