AI Helps U.S. Treasury Recover $1 Billion in Fraud Detection for 2024—and It’s Just Getting Started

The U.S. Treasury Department has harnessed the power of artificial intelligence (AI) to detect and recover over $1 billion in fraud during fiscal year 2024, nearly tripling the amount recovered the previous year. This significant achievement marks a new chapter in how the federal government leverages technology to protect taxpayer dollars from financial crime.

Renata Miskell, a senior Treasury official, said that AI has been "transformative" for fraud detection efforts. "Leveraging data has significantly enhanced our ability to prevent and recover fraudulent activity," Miskell told CNN. The department credited AI for helping prevent and recover more than $4 billion in fraud overall in 2024—a sixfold increase from the previous year.

The U.S. Treasury began using AI in 2022 to detect financial crime, inspired by the same machine learning techniques that banks and credit card companies employ to thwart fraudulent activity. The use of machine learning—AI that analyzes massive datasets to detect suspicious patterns and anomalies—has allowed the Treasury to act faster and more efficiently than ever before.

AI’s ability to analyze extensive amounts of data in mere milliseconds has made it a critical tool in sniffing out fraudulent transactions. Miskell noted that AI allows the Treasury to identify hidden schemes fraudsters use to game the system and helps stop them before significant losses occur.

Given the Treasury’s role in managing roughly $7 trillion in payments annually—spanning everything from Social Security and Medicaid payments to federal tax refunds and stimulus checks—the department is a prime target for financial criminals. The ongoing application of AI in detecting fraud has become crucial in maintaining the integrity of the U.S. financial system.

The Treasury's use of AI is still in its early stages, but officials are exploring more ways to implement fraud-detection methods similar to those used by leading financial institutions. These efforts are expanding into various federal and state-administered programs, with new data sources being tested to detect and prevent fraud more effectively.

As AI technology continues to evolve, the Treasury is committed to staying ahead of emerging threats and strengthening its fraud detection capabilities, ensuring that taxpayers' money is better protected in the future.