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$286m in Pandemic Fraud Flowed Through One Online Bank

Fraudsters used one online bank and fake or stolen employment and personal information to steal $286 million in pandemic loans, money that now will be returned to the Small Business Administration, the Associated Press reports. The Orlando Secret Service office found that alleged conspirators submitted Economic Injury Disaster Loan applications by using fake or stolen employment and personal information and used an online bank, Green Dot, to conceal and move their criminal proceeds. The agency worked with Green Dot to identify roughly 15,000 accounts and seize $286 million connected to the accounts. “This forfeiture effort and those to come are a direct and necessary response to the unprecedented size and scope of pandemic relief fraud,” said Kevin Chambers, director for COVID-19 fraud enforcement at the Justice Department.


Billions have been fraudulently claimed through various pandemic relief programs — including Paycheck Protection Program loans, unemployment insurance and others that were sent out in the middle of the pandemic that shutdown global economies for months. In March, the Government Accountability Office reported that while agencies were able to distribute COVID-19 relief funds quickly, “the tradeoff was that they did not have systems in place to prevent and identify payment errors and fraud” due in part to “financial management weaknesses.” Since 2020, the Secret Service initiated more than 3,850 pandemic related fraud investigations, seized over $1.4 billion in fraudulently obtained funds and helped to return $2.3 billion to state unemployment insurance programs.

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A daily report co-sponsored by Arizona State University, Criminal Justice Journalists, and the National Criminal Justice Association

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