Sanders, Grassley team up to penalize Pentagon for failing audits

A bipartisan duo is pushing a bill to impose financial consequences if the Pentagon fails to pass a full, independent audit after its eighth straight review could not account for trillions of dollars. Sens. Bernard Sanders, Vermont independent, and Chuck Grassley, Iowa Republican, reintroduced the Audit the Pentagon Act on Thursday, aiming to reprimand the Pentagon by withholding 2% of its budget if it fails to achieve a clean audit opinion. The Trump administration’s proposed fiscal 2027 defense plan includes a record $1.5 trillion baseline Pentagon budget request. If any of its components failed an audit, $30 billion would be withheld under the bill. Anything held back would be returned to the Treasury Department for deficit reduction. Its latest audit, released in December and covering $4.65 trillion in reported assets and $4.7 trillion in liabilities, included over two dozen instances of the most severe auditing errors and two additional significant accounting issues in the department’s internal controls over financial reporting. Defense leadership noted the errors stem from thousands of outdated, disconnected accounting systems rather than lost or stolen funds. The department’s chief financial officer said leadership aims to resolve these issues and achieve a clean audit opinion by 2028. The Pentagon accounts for more than half of the federal government’s discretionary spending and two-thirds of all federal contracting activity. It also remains the only major federal agency to have never passed a clean financial audit, which Mr. Sanders dubbed an “absurdity” that must end. “The Pentagon has been plagued by a massive amount of waste, fraud and financial mismanagement for decades,” he said in a statement. “Year after year, the Pentagon fails an audit, and year after year, Congress hands it another blank check. At a moment when the administration has dragged us into an unconstitutional war with Iran and is demanding the largest military budget in our history to pay for it, the Pentagon still cannot tell us where trillions of dollars have gone.” The Government Accountability Office, a congressional watchdog, added fraud risk management at the Pentagon to its high-risk list upon finding that the department confirmed $10.8 billion in fraud between fiscal 2017 and 2024 alone. Mr. Grassley said this bill holds the Defense Department accountable by ensuring it meets the same audit standards as other agencies and by threatening a financial penalty. “Any dollar lost by the Department of Defense wastes taxpayers’ money and weakens our national security,” he said. A similar bill has been introduced in the House, and comparable legislation has been proposed over the years without becoming law. Story Topics