A significant portion of the federal COVID-19 relief aid was stolen by fraudsters using various means, including the use of Social Security numbers of dead people and federal prisoners, leading to what could be the greatest grift in U.S. history. The lack of oversight during the pandemic’s early stages and the fewer restrictions on applicants made it easy for these acts of fraud to take place. While efforts to combat this issue are underway, the current scale of the fraud is in the tens of billions of dollars and could exceed $100 billion as investigations progress.
- The fraudulent theft of the relief funds involved a wide range of actors, from ordinary citizens to organized criminals and even federal loan applicants who were not cross-checked against a Treasury Department database.
- Most of the stolen funds were swiped from three large pandemic-relief initiatives launched during the Trump administration and inherited by President Joe Biden. The measures aimed to help small businesses and unemployed workers survive the economic upheaval caused by the pandemic.
- The U.S. government has charged more than 2,230 defendants with pandemic-related fraud crimes and continues to conduct thousands of investigations. Despite this, the final accounting is still at least a couple of years away.
- In the rush to provide aid, safeguards to protect federal money were loosened. This laxity allowed prospective borrowers to self-certify the accuracy of their applications, leading to a higher likelihood of fraudulent activity.
- Despite stricter rules and proposed budgetary measures to combat fraud, the scale of the issue remains overwhelming. Investigations have uncovered a significant amount of potential fraud, leading to a backlog of leads and a long-term commitment to rectify the situation.