Federal Reports

The Consumer Product Safety Commission (CPSC) Office of Inspector General retained Williams, Adley & Co.-DC LLP, an independent public accounting firm, to perform an audit of the CPSC’s Zero Trust implementation.  Overall, the audit confirmed the CPSC’s current Zero Trust trajectory is aligned with federal cybersecurity modernization objectives and supports the continued development of a more secure and resilient information security environment.  

Introduction

This management alert presents the issues the U.S. Postal Service Office of Inspector General (OIG) identified during the Effectiveness of Package Verification Solutions audit (Project Number 25-130). Our objective is to provide immediate notification of these issues. 

Background

In August 2017, the U.S. Postal Service launched the Automated Package Verification (APV) system to identify insufficient postage for some package volume. The system compares shippers’ reported package weights and measurements with actuals captured on postal processing equipment, charging any additional postage due and refunding overpayments (see Figure 1 for an example of package processing equipment). In 2018, the Postal Service invested $22.6 million to expand APV capabilities to improve revenue protection by evaluating every package that is processed on plant equipment. Since it was introduced, APV has increased Postal Service postage collection by $1.1 billion.

We conducted an audit on the effectiveness of the U.S. Department of Housing and Urban Development’s (HUD) Home Equity Conversion Mortgage (HECM) program’s Life Expectancy Set Asides (LESA).  The LESA is a set aside portion of the HECM mortgage that makes property tax, hazard insurance, and flood insurance payments on behalf of certain financially vulnerable borrowers.  While not guaranteed, the LESA funds are intended to last for the full duration of the borrower’s life expectancy.  We initiated this audit because of recent federal reporting on rising nationwide property tax and hazard insurance costs, paid for by LESA funds.  Our audit objective was to determine whether LESAs were meeting the intent of the program for financially vulnerable borrowers.

We found an estimated 1,237 HECM borrowers will need to begin making property charge payments out of pocket because their LESAs will deplete in significantly less time than HUD estimated they would last. This occurred because HUD did not evaluate whether LESA calculations were effective or whether LESAs would be available for the borrowers’ estimated life expectancy.  If borrowers cannot make these property charge payments out of pocket, their HECM loans would default, resulting in a projected loss of $258 million to HUD.

The 2026-2030 strategic plan outlines the vision and priorities that guide EAC OIG as it carries out its mission.

Opportunities Exist to Strengthen Investment Management's Disclosure Review Program, Report No. 590