That goal, if achieved, would not even halve the USD 110 billion made in such payments last year.

The new law will strengthen the efforts by federal agencies to halt the flow of improper money in a series of ways. Among those steps: requiring more audits of programs and adding penalties for agencies that do not comply with the law. The legislation also broadens how recovered money can be used.

Obama chose to sign the bill before cameras in the White House's State Dining Room in hopes of bringing attention to the new law. He announced a goal of reducing improper payments by USD 50 billion by 2012; the White House says that year's total of nearly USD 110 billion in these payments was the highest ever.

The president said the ultimate goal is to end all improper payments.
"We have to challenge a status quo that accepts billions of dollars in waste as the cost of doing business," the president said.

Bad payments range from outright fraud to checks issued to the wrong people or for the wrong amount because of a typographical error. The president said every dollar wasted should be going toward helping people afford college, providing benefits to the military and many other legitimate uses of tax money.

For perspective, he said the USD 110 billion figure in wasted money last year was more than the budgets of the Department of Education and the Small Business Administration combined. "That's unacceptable," he said.

The bill marked the latest effort by the administration to get a tighter handle on Washington spending, a politically sensitive issue as more Americans show interest in the nation's mounting debt. The president used the opportunity to recite a series of other measures to target unneeded spending on his watch. (AP)