Software Flaw Results in $472 Million Worth of Uncollected Debts Owed to Numerous Federal Agencies

A whistleblower report identified almost half a billion dollars in debts owed to over 28 federal agencies that was caused by a software problem.

A software flaw caused uncollected debts owed to over 28 federal agencies to pile up to the tune of over $472 million dollars.

The problem was reported by an anonymous whistleblower. In 2019, the Treasury Department’s Office of Inspector General initiated an audit in response to a referral from the Office of Special Counsel.

The whistleblower report was made regarding debts owed to the Department of Labor Occupational Safety and Health Administration (OSHA), but the audit revealed that the extent of the problem was much larger and impacted many more agencies and totaled hundreds of millions of dollars.

The audit delineates the amount of all of the debts and to which federal agencies they are owed. The bulk of the debts were owed to the Department of Defense and “independent agencies,” totaling $134,909,410.05 and $146,706,286.45, respectively.

The debts are ones collected by the Bureau of the Fiscal Service and were described in the audit report as “delinquent nontax debt [collected] on behalf of federal agencies.”

The software in question is called Cross-Servicing Next Generation (CS-NG) which is a commercial-off-the-shelf product also known as the Artiva system. It is used by the Bureau of the Fiscal Service under the Debt Collection Improvement Act (DCIA) for government-wide debt collection which includes cross-servicing efforts.

Regarding the software problem, the Treasury IG audit states “…that due to a software issue associated with the implementation of the CS-NG system, Fiscal Service did not perform cross-servicing on multiple debts referred by OSHA. CS-NG was unable to initiate collection efforts on migrated and submitted debts that included a business address instead of primary address.”

The problem has since been fixed and the outstanding debts have started to get collected. For instance, as of June 27, 2022, $557,160.63 had been collected on the DoD debt of $134,909,410.05, one of the larger debts among those in the audit report.

OSC Special Counsel Henry J. Kerner said in a statement, “I again commend the whistleblower for bringing these serious allegations forward. The audit shows the scope and magnitude of this problem were far more significant than previously known. The whistleblower’s disclosure made it possible for the federal government to initiate collection of nearly a half-billion dollars in uncollected debts.”

About the Author

Ian Smith is one of the co-founders of He has over 20 years of combined experience in media and government services, having worked at two government contracting firms and an online news and web development company prior to his current role at FedSmith.