Elon Musk’s entry to Treasury’s fee system is elevating alarms. Here is what to know.

Elon Musk’s entry to Treasury’s fee system is elevating alarms. Here is what to know.

With Elon Musk’s Division of Authorities Effectivity (DOGE) gaining management of the Treasury Division’s fee system, shopper advocates and Democratic lawmakers are elevating alarms in regards to the group’s entry to the federal authorities’s monetary spigot, in addition to delicate information such because the Social Safety numbers of most taxpayers.

DOGE, a Trump administration activity pressure assigned to seek out methods to cut back federal spending, now has entry to a Treasury unit referred to as the Bureau of the Fiscal Service, which disburses trillions in funds annually, together with Social Safety checks and federal salaries, in line with the Related Press.

Musk’s entry to the fee system is elevating issues because it comes simply days after the White Home ordered a broad freeze on federal grants and loans, inflicting confusion inside federal help applications, at nonprofits and amongst Individuals receiving authorities support. That very same day, state Medicaid applications mentioned they have been locked out of the Division of Well being and Human Providers system used to trace and disburse cash. 

What are the issues?

Whereas the White Home later rescinded the memo and a decide halted the freeze, DOGE’s management of the Treasury’s fee system raises questions in regards to the Trump administration’s means to halt the movement of federal funds for applications together with Medicare and Social Safety. It is also inflicting issues about DOGE’s entry to the non-public and monetary data of most taxpayers.

“There is no group of Individuals that this technique doesn’t contact, and so I feel the priority is that entry to this technique together with personally identifiable data has been ceded to the president’s billionaire buddy for causes which can be passing understanding,” Donald Okay. Sherman, government director and chief counsel of the watchdog group Residents for Duty and Ethics in Washington, instructed CBS MoneyWatch. 

There are “fairly actual dangers” that DOGE “may probably undermine that system and threaten hundreds of thousands of Individuals from getting funds that they’re due,” he added.

Musk’s entry to the Treasury fee system has sparked concern from Democratic lawmakers together with Sens. Elizabeth Warren and Ron Wyden, whereas a lawsuit was filed on Monday alleging “illegal ongoing, systematic, and steady disclosure of non-public and monetary data” to Musk and DOGE. The lawsuit, filed by two unions and the Alliance for Retired Individuals, names U.S. Treasury Secretary Scott Bessent and the Treasury as defendants. 

“Controlling the system may permit the Trump Administration to ‘unilaterally’ — and illegally — minimize off funds for hundreds of thousands of Individuals, placing in danger the monetary safety of households and companies primarily based on political favoritism or the whims of Mr. Musk and people on his workforce who’ve labored their manner inside,” mentioned Sen. Elizabeth Warren, a Democrat from Massachusetts, in a Feb. 2 letter to Bessent. 

She added, “It may additionally give them entry to hundreds of thousands of Individuals’ private and monetary data that’s protected by legislation.”

The Treasury Division did not instantly reply to a request for remark. 

Nevertheless, CBS Information obtained a letter despatched from Jonathan Blum, a legislative affairs official with the Treasury Division, to members of Congress Tuesday, which claimed that DOGE will solely have “read-only” entry to the division’s information.

The letter acknowledged that Tom Krause, a member of Musk’s DOGE workforce who has been introduced in as a Treasury Division worker, will “have read-only entry to the coded information of the Fiscal Service’s fee methods” as a part of an “operational effectivity evaluation.”

“That is just like the form of entry that Treasury gives to people reviewing Treasury methods, comparable to auditors, and that follows practices related to defending the integrity of the methods and enterprise processes,” the letter learn, describing Krause as a “longtime know-how government.” 

Here is what to know in regards to the Bureau of the Fiscal Service. 

What’s the Bureau of the Fiscal Service?

The Treasury has lengthy been the federal authorities’s checkbook, tasked with dealing with funds for particular person businesses primarily based on funds appropriated by Congress. Its methods management the movement of over $6 trillion in funds to American households, companies and different recipients annually. 

The Treasury Division’s Bureau of the Fiscal Service handles most of these funds. About 90 cents of each $1 in federal funds are despatched by the little-known division.

In fiscal 2023, the unit disbursed practically 1.3 billion funds totaling $5.4 trillion, in accordance to the company. Nearly 97% of the funds have been made electronically and all have been made on time, it famous. 

How did DOGE get management of the fee system?

The chief order signed by President Trump that created DOGE directed all businesses to verify it was given “full and immediate entry to all unclassified company information, software program methods and IT methods.” DOGE itself just isn’t a federal division. 

Musk, the billionaire CEO of Tesla, gained management of the system after Treasury’s performing Deputy Secretary, David Lebryk, resigned from his place after greater than 30 years of service. Lebryk stepped down after Musk and his DOGE group requested entry to delicate Treasury information, the Washington Submit had reported. 

On Sunday, Musk acknowledged that DOGE had stopped funds from the U.S. Division of Well being and Human companies to Lutheran Household Providers, a faith-based charity that had been providing social companies to refugees. 

Might this affect Social Safety? 

Lawmakers and shopper advocates are elevating issues in regards to the potential affect on authorities applications together with Social Safety, though neither Musk nor Mr. Trump have flagged Social Safety as a goal for cuts.

Certainly, Mr. Trump has mentioned he’ll protect Social Safety, and whereas on the marketing campaign path he vowed to eradicate taxes on Social Safety Revenue. However as a result of the Bureau of the Fiscal Providers sends month-to-month checks to greater than 70 million Social Safety beneficiaries, some advocates say they’re anxious. 

Musk and DOGE “now have entry to the non-public data of each Social Safety beneficiary — and the power to cease funds for any federal applications they dislike,” mentioned Max Richtman, CEO of the Nationwide Committee to Protect Social Safety and Medicare, an advocacy group for the applications, in an e mail. “Seniors, their households, and other people with disabilities most definitely can’t belief Trump and Musk with their essential federal advantages — or their private information.”

Sen. Ron Wyden, the highest Democrat on the Senate Finance Committee, mentioned in a Jan. 31 letter to Bessent that he is involved that Social Safety checks might be impacted, “whether or not intentional or unintentional.”

“It seems that Musk’s conduct is forcing out extremely certified and skilled profession public servants with the intention to get his manner and fulfill Trump’s purpose of eviscerating the federal price range, together with probably by chopping Social Safety and Medicare advantages for hundreds of thousands of Individuals who’re already struggling to pay their payments or purchase groceries,” he wrote.

In a response to Wyden’s letter, nevertheless, Jonathan Blum, a legislative affairs official at Treasury, instructed Wyden that DOGE personnel are solely solely in a position to learn “coded information” within the federal fee system and can’t change scheduled methods. DOGE “has not induced funds for obligations comparable to Social Safety and Medicare to be delayed or re-routed,” Blum wrote. 

Bloomberg was the primary to report on the letter.

Warren mentioned Blum’s letter raised extra questions than solutions. “It asserts {that a} set of Treasury employees members have ‘read-only’ entry however fails to reply questions on non-Treasury workers, like these working for Elon Musk and DOGE,” she mentioned in an announcement.

Does Musk have entry to taxpayers’ private information?

Lawmakers and shopper advocates are additionally elevating issues about DOGE’s entry to non-public information for hundreds of thousands of American taxpayers. As a result of the Bureau of the Fiscal Service distributes tax refunds and Social Safety funds, it has entry to the Social Safety numbers and financial institution accounts of recipients. 

Kate Miller, who serves on an advisory board for DOGE, did not reply to requests for remark however did repost an Related Press article on X with the remark, “No categorised materials was accessed with out correct safety clearances.” 

Entry to that non-public data may pose dangers to taxpayers, in line with information security consultants. 

“Historically, entry to this data has been extremely restricted and among the many most safe data the U.S. authorities holds,” mentioned James E. Lee, the president of the Identification Theft Useful resource Heart, mentioned in an e mail to CBS MoneyWatch. 


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04:06

He added, “That is the form of data that, if it discovered its manner into the arms of a foul actor, may result in a variety of id crimes — impersonation to open new accounts or entry current ones, theft of the funds in an current banking account, making use of for brand spanking new state or federal authorities advantages, and submitting false tax returns amongst different types of id fraud.”

The info can also be delicate as a result of it might be helpful to intelligence businesses in different nations, together with the non-public information of presidency workers or ties that companies have with the U.S. authorities, Lee famous.

That concern was echoed by Sen. Wyden, who within the Jan. 31 letter to Bessent questioned granting entry to delicate data to Musk on account of important enterprise pursuits in China, noting that Tesla operates its largest manufacturing facility in China. Musk did not reply to a request for remark.

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