TUESDAY, the US Secret Service stated that about $100 billion had been taken through COVID-19 assistance programs established to assist businesses and people who lost jobs due to the pandemic.
According to Roy Dotson, the agency's national pandemic fraud recovery coordinator, the estimate is based on Secret Service cases and statistics from the Labor Department and the Small Business Administration. The Secret Service omitted prosecutions of COVID-19 fraud by the Justice Department.
While approximately 3% of the $3.4 trillion distributed was stolen, the amount lost from pandemic benefit schemes demonstrates that "the sheer size of the pot is enticing to criminals," Dotson said.
The majority of the figure is due to unemployment fraud. According to the Labor Department, around $87 billion in unemployment benefits may have been wrongly paid, with a sizable chunk attributed to fraud.
The Secret Service reported seizing more than $1.2 billion during investigations into unemployment insurance and loan fraud and reimbursing more than $2.3 billion in fraudulently obtained monies through collaboration with banking partners and states. The Secret Service reports that it is currently conducting more than 900 criminal investigations into pandemic fraud, with cases spanning all 50 states, and that 100 persons have been arrested thus far.
Last week, the Justice Department announced that its fraud section had prosecuted over 150 defendants in over 95 criminal cases and seized over $75 million in cash proceeds from fraudulently obtained Paycheck Protection Program funds, as well as numerous real estate properties and luxury items purchased with the proceeds.
One of the most well-known initiatives established under the March 2020 CARES Act, PPP provided low-interest, forgiven loans to small businesses struggling to meet payroll and other expenditures during pandemic-related shutdowns.
According to the Secret Service, law enforcement concentrated on fraud involving personal protective equipment early in the pandemic. Authorities have prioritized the exploitation of pandemic-related relief efforts due to the CARES Act's federal funds attracting the attention of individuals and organized criminal networks globally.
"Can we put an end to fraud?" Are we going to? No, but I believe we can prosecute those who need to be prosecuted and collect as much fraudulent pandemic money as possible," said Dotson, the Secret Service's associate special agent in charge of the agency's field office in Jacksonville, Florida.
