I think they proved that the waste is not easily defined. I would call fraud, waste, but a computer program isn't likely to discover it without boots on the ground looking to see if the money is actually going where the records indicate.
Fraud doesn't even begin to describe it.
They are not. You are imputing your own meanings into the word "subsidy". If you buy a Coke from a Coke machine, you are not "subsidizing" the machine's vendor.