To what degree were Covid-19 business relief programs used for fraudulent purposes?
Think $5.4 billion.
That is the figure announced by the Pandemic Response Accountability Committee, which is reporting that tens of thousands of applications for funding were what it calls “potentially fraudulent.”
That committee was set up as part of the Coronavirus Aid, Relief, and Economic Security Act to ensure that relief spending was not misused.
The deception came with applications for Economic Injury Disaster Loans and the Paycheck Protection Program, both of which were tasked with providing loans and assistance to small businesses economically impacted by the Covid-19 outbreak and national shutdown.
According to Eugene Dodaro, U.S. Comptroller General and head of the federal Government Accountability Office, final figures totaling the deception have yet to be ascertained.
“It will be a while before the full extent of fraud is known,” said Dodaro in testimony before the House Committee on Oversight and Accountability, noting that more than 1,000 individuals have been convicted or have pled guilty to relief program fraud.
Some 600 additional charges are currently pending against others.
Dodaro suggested to lawmakers that new investments in fraud detection, upgrading systems seen as outdated, should be made to detect fraud in future massive business relief programs. The goal from the start, asserted Dodaro, was to “get the funds to the people who needed it and now allow this type of fraudulent activity to plague our national programs.”
Altogether, more than 69,300 questionable Social Security numbers were used to obtain covid relief monies, asserts the Pandemic Response Accountability Committee.
Both the Economic Injury Disaster Loans and Paycheck Protection Program, said the committee’s report, were “susceptible to fraud due to the elevated urgency for agencies to provide timely relief to applicants in response to the Covid 19 pandemic.”
By Garry Boular
