Case Study: How Open data saved Canada $3.2 Billion
In his excellent blog about open government and open data, David Eaves describes how a Toronto consultant exposed a multi-billion charities fraud – simply by analyzing contributions data obtained from Canada Revenue Agency.
Using just a PC and a spreadsheet, the consultant analyzed the contributions reported by charities in Toronto during 2005 – a dataset that he had obtained from CRA – and uncovered some startling facts.
Sorting the spreadsheet by total contributions revealed that two hitherto obscure charities had each raised far more money than the United Way, Canada's leading charitable organization. This was clearly implausible and likely fraudulent. Worse, the data revealed that four out of the top 15 charities on the list were suspect.
The outcome was that over the next few years CRA deregistered numerous fraudulent charities and disallowed or questioned $3.2 billion in tax receipts claimed by 100,000 Canadian tax filers. And a class action suit against one of these charities was launched by thousands of donors.
If one person with a spreadsheet could accomplish this by scrutinizing a tiny sliver of one department's records, imagine what waste and misconduct could be uncovered if the government would abandon its obsessive secrecy and open more of its books to scrutiny by citizens. Why not? It is our money.
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