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Pandemic Relief Fraudsters Estimated to Have Stolen $280B

An Associated Press analysis found that fraudsters may have stolen more than $280 billion in COVID-19 relief funding; another $123 billion was wasted or misspent. Combined, the loss represents 10% of the $4.2 trillion the U.S. government has so far disbursed in COVID relief aid. That number is certain to grow as investigators dig deeper into thousands of potential schemes, AP reports. Investigators and experts say the government, in seeking to spend trillions in relief aid quickly, conducted too little oversight during the pandemic’s early stages and instituted too few restrictions on applicants. In short, they say, the grift was way too easy. “Here was this sort of endless pot of money that anyone could access,” said Dan Fruchter, chief of the fraud and white-collar crime unit at the U.S. Attorney’s office in the Eastern District of Washington state. “Folks kind of fooled themselves into thinking that it was a socially acceptable thing to do, even though it wasn’t legal.”

The U.S. government has charged more than 2,230 defendants with pandemic-related fraud crimes and is conducting thousands of investigations. Most of the looted money was swiped from three large pandemic-relief initiatives launched during the Trump administration and inherited by President Biden. Those programs were designed to help small businesses and unemployed workers survive the economic upheaval caused by the pandemic. The pilfering was wide but not always as deep as the eye-catching headlines about cases involving many millions of dollars. All of the theft, big and small, illustrates an epidemic of scams and swindles at a time the U.S. was grappling with overrun hospitals, school closures and shuttered businesses. Michael Horowitz, the U.S. Justice Department inspector general who chairs the federal Pandemic Response Accountability Committee,said the fraud is “clearly in the tens of billions of dollars” and may eventually exceed $100 billion.


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