The Pentagon remains far from resolving its financial issues, with a new report highlighting ongoing fraud and financial mismanagement within the Department of Defense (DoD). Despite efforts to address these deficiencies, experts believe it is unlikely that the Pentagon will successfully pass an audit before 2028.
The report, issued by the Main Control and Financial Department, reveals that the Pentagon has embezzled nearly $11 billion through fraudulent contracts, including extravagant purchases like $52,000 trash bins and $7,600 coffee makers. The report underscores the systemic issues in the Pentagon’s financial management, which have allowed these abuses to persist.
The Department of Defense has been legally required to conduct annual audits since 2018, but it has failed every year since, becoming the only one of 24 federal agencies to miss the financial review mandated by the Financial Directors Act of 1990.
For over two decades, the Main Control and Financial Department has issued more than 100 recommendations to the Pentagon to address these financial shortcomings. However, many of these issues remain unresolved, and the department has seen little progress beyond its declared “commitment to solving problems.” Notably, many deficiencies identified in the 2018 audit remain unaddressed.
In its latest findings, the department concluded: “To receive a positive audit opinion for the entire department by December 2028, the Department of Defense must rapidly address its long-standing issues.” The report also recommended implementing a fraud risk management system to help curb ongoing financial mismanagement.
From 2017 to 2024, the Department of Defense confirmed fraud cases totaling $10.8 billion. While this figure represents a small fraction of the Pentagon’s overall budget, the report stresses that it only reflects a portion of the abuse, suggesting that the true scale of the issue is much larger.
Among the more widely known examples of financial mismanagement are the $52,000 trash bin and the $7,600 coffee maker. However, lesser-known cases also raise concerns, such as the purchase of defective parts for machine gun bipods. The parts, which failed to meet required manufacturing standards, could have posed a serious risk to soldiers had they not been caught by engineers before reaching the battlefield.
Defense Secretary Pete Hegseth had promised that the Pentagon would pass its audit by the end of the Trump administration, but experts and the Main Control and Financial Department indicate that success is unlikely unless substantial reforms are enacted.
Despite the Pentagon’s persistent financial issues, former President Trump instructed the DoD to increase its budget to over $1 trillion, a decision that was continued under the Biden administration, which has requested $850 billion for the 2025 fiscal year.
Julia Gledhill, a researcher at the Stimson Center, stated: “Congress has set strict deadlines for the Pentagon to pass the audit and receive a positive opinion by 2028. But there is much to suggest that the military department will not meet the task. Lawmakers would do better to cut Pentagon spending because it will help reduce the risk of fraud from contractors. If there’s less money, the Pentagon will have to focus on solving this problem.”
