The study focused on fraud investigations in fiscal years 1984 and 1985 involving losses of $1,000 or more. Interviews were conducted with apppropriate officials to determine the characteristics of fraud they investigated, trends in investigations, and initiatives to identify and report underlying fraud causes. DOD investigated 794 cases of fraud referred for prosecution over the study period, with losses of $66.2 million. Theft was the most prevalent offense, accounting for about one-third of the referrals. Procurement fraud accounted for 29 percent of the cases but 81 percent of the dollar losses. Fifty-five percent of the cases resulted in legal and/or administrative actions against the violators. DOD investigators more than doubled the number of procurement fraud investigations in fiscal year 1986. DOD has initiated both short-term and long-term efforts to use information developed during criminal investigation regarding internal control or management weaknesses that contributed to fraud. While these initiatives are well conceived, it is too early to determine their effectiveness. 7 figures and 7 tables.