Over $200 billion from the U.S. Government’s COVID-19 relief Programs Were Potentially Stolen

According to a federal watchdog, Over $200 billion from the U.S. government’s COVID-19 relief programs were potentially stolen.

He made the statement on Tuesday, adding that the U.S. Small Business Administration (SBA) had weakened its controls in a rush to disburse the funds.

At least 17% of all funds related to the government’s coronavirus Economic Injury Disaster Loan (EIDL) and Paycheck Protection Program (PPP) schemes were disbursed to potentially fraudulent actors, according to a report released Tuesday by the SBA’s office of inspector general.Over the course of the pandemic, the SBA disbursed about $1.2 trillion of EIDL and PPP funds.

The SBA disputed the more than $200 billion figure put forward by the watchdog and said the inspector general’s approach had significantly overestimated fraud.

The agency said its experts put the potential fraud estimate at $36 billion and added that over 86% of that likely fraud took place in 2020, when the administration for former President Donald Trump was in office. President Joe Biden took office in January 2021.

The fraud estimate put forward by the inspector general for the EIDL program stood at more than $136 billion while the PPP fraud estimate was $64 billion.The United States is probing many fraud cases pegged to U.S. government assistance programs. In May 2021, Attorney General Merrick Garland launched a COVID-19 Fraud Enforcement Task Force.

Last year, the U.S. Justice Department tapped federal prosecutor Kevin Chambers to lead its efforts to investigate alleged fraud schemes intending to bilk government pandemic assistance programs.

In September 2022, the inspector general for the U.S. Labor Department said fraudsters likely stole $45.6 billion from the United States’ unemployment insurance program during the coronavirus outbreak by applying tactics like using Social Security numbers of deceased individuals.

Also in September, federal prosecutors charged dozens of defendants, who were accused of stealing $250 million from a government aid program that was supposed to feed children in need during the pandemic.