More resources are needed to investigate and prosecute people who stole billions in pandemic relief funds, the Justice Department says. Federal officials said they have made “significant progress” in going after fraud, but conceded that “substantial work remains in the face of numerous challenges.” Agencies responsible for pursuing pandemic fraudsters have been restrained by budget cuts. The federal government, which distributed trillions in relief funds after the onset of the pandemic, has charged more than 3,500 defendants related to pandemic fraud. That’s up from 3,100 defendants who had been charged as of August. More than $1.4 billion in fraudulently obtained funds have been seized or forfeited. Most cases involve the Paycheck Protection Program, the Economic Injury Disaster Loan program and expanded unemployment benefits.
While the amount of stolen funds is unknown, the Small Business Administration’s inspector general estimated that more than $200 billion — or at least 17 percent of the roughly $1.2 trillion in pandemic loans the agency awarded — was distributed to “potentially fraudulent actors,” reports the New York Times. The Government Accountability Office said that as much as $135 billion of the $900 billion in unemployment benefits distributed between April 2020 and May 2023 were likely illegally claimed. While most pandemic relief programs have ended, DOJ officials said that state work force agencies continue to provide additional data that could be analyzed for leads. Some stolen relief funds also “remain restrained in bank accounts and need to be forfeited,” said a DOJ report.