Washington: Nearly $100 billion at minimum has been stolen from COVID-19 relief programmes set up to help businesses and people who lost their jobs due to the pandemic, the US Secret Service said on Tuesday.
The estimate is based on Secret Service cases and data from the Labor Department and the Small Business Administration, said Roy Dotson, the agency’s national pandemic fraud recovery coordinator, in an interview.
The Secret Service didn’t include COVID-19 fraud cases prosecuted by the Justice Department. While roughly 3% of the $3.4 trillion dispersed, the amount stolen from pandemic benefits programmes shows “the sheer size of the pot is enticing to the criminals,” Dotson said.
Most of that figure comes from unemployment fraud. The Labour Department reported about $87 billion in unemployment benefits could have been paid improperly, with a significant portion attributable to fraud.
The Secret Service said it has seized more than $1.2 billion while investigating unemployment insurance and loan fraud and has returned more than $2.3 billion of fraudulently obtained funds by working with financial partners and states to reverse transactions.
The Secret Service says it has more than 900 active criminal investigations into pandemic fraud, with cases in every state, and 100 people have been arrested so far.
The Justice Department said last week that its fraud section had prosecuted over 150 defendants in more than 95 criminal cases and had seized over $75 million in cash proceeds derived from fraudulently obtained Paycheck Protection Programme funds, as well as numerous real estate properties and luxury items purchased with the proceeds.
One of the best-known programmes created through the March 2020 CARES Act, PPP offered low-interest, forgivable loans to small businesses struggling to meet payroll and other expenses during pandemic-related shutdowns.
Law enforcement early in the pandemic focused on fraud related to personal protective equipment, the Secret Service said.
Authorities have now prioritised the exploitation of pandemic-related relief because the federal funding through the CARES Act attracted the attention of individuals and organised criminal networks worldwide.