Enhanced Processes and Implementer Requirements Are Needed To Address Challenges and Fraud Risks in USAID’s Venezuela Response

Audit Report
Report Number
9-000-21-005-P
Political and economic turmoil in Venezuela has triggered one of the largest humanitarian crises in the history of the Western Hemisphere, leading to 5.1 million Venezuelans leaving the country to escape severe shortages of food, medicine, and healthcare services; skyrocketing hyperinflation and unemployment; outbreaks of infectious diseases; and one of the highest homicide rates in the world. The outpouring of migrants from Venezuela and the resulting impact on the Latin America and the Caribbean region has emerged as a critical foreign policy priority for the U.S. Government. USAID partnered with the State Department to prioritize the delivery of assistance to the Venezuelan people and to neighboring countries supporting and aiding Venezuelan migrants. However, USAID faced significant policy, coordination, and strategic planning challenges in responding to the Venezuela regional crisis, from not having a process for documenting directives from the National Security Council and the State Department to not having developed joint strategic humanitarian response plans with the State Department and Strategic Frameworks internally to guide its development programs in the region affected by the Venezuelan crisis. Also, while the Office of U.S. Foreign Disaster Assistance and the Office of Food for Peace incorporated leading practices to manage fraud risks, their guidelines to implementers lacked risk management requirements. We made six recommendations to improve USAID’s response to the Venezuela regional crisis and, in some instances, improve USAID’s future responses to international disasters—including strengthening humanitarian assistance policy and processes, strategic planning for development programs, and requiring implementer use of leading practices for fraud risk management in humanitarian programs.

Recommendations

Recommendation
1

Develop and implement a process for issuing documented directives on implementing foreign policy guidance to humanitarian programs to the Bureau for Humanitarian Assistance. This process should consider the impact of directives on the Bureau for Humanitarian Assistance"s ability to adhere to humanitarian principles and risk appetite.

Questioned Cost
0
Funds for Better Use
0
Recommendation
2

In coordination with the Bureau for Management, review and revise Automated Directives System chapter 251 to incorporate Foreign Assistance Manual Volume 2, chapter 060 requirements for adhering to humanitarian principles outlined in the Good Humanitarian Donorship.

Questioned Cost
0
Funds for Better Use
0
Recommendation
3

Develop and implement a process for coordinating with the State Department"s Bureau of Population, Refugees, and Migration on joint strategic humanitarian response plans at the country and/or regional level. This process should articulate key considerations for interagency coordination, including programming roles and responsibilities, humanitarian mandates, and migratory status of beneficiaries.

Questioned Cost
0
Funds for Better Use
0
Close Date
Recommendation
4

Review and revise humanitarian assistance "Application Guidelines" for implementers to strengthen the use of U.S. Government Accountability Office leading practices for managing fraud risks, including planning and risk assessment activities and data analytics activities.

Questioned Cost
0
Funds for Better Use
0
Close Date
Recommendation
5

In coordination with the Bureau for Policy, Planning, and Learning, complete a documented review of USAID's development assistance portfolio in Venezuela to determine whether to develop and implement a Strategic Framework, in accordance with Automated Directives System chapter 201 requirements.

Questioned Cost
0
Funds for Better Use
0
Close Date
Recommendation
6

In coordination with the Bureaus for Latin America and the Caribbean and Policy, Planning, and Learning, complete a documented review of USAID/South America Regional's development assistance portfolio in Brazil, Ecuador, and Peru to determine whether to develop and implement a Strategic Framework, in accordance with Automated Directives System chapter 201 requirements.

Questioned Cost
0
Funds for Better Use
0
Close Date