Attention FAE Customers:
Please be aware that NASBA credits are awarded based on whether the events are webcast or in-person, as well as on the number of CPE credits.
Please check the event registration page to see if NASBA credits are being awarded for the programs you select.

Senate Introduces Pandemic Aid Fraud Bill

S.J. Steinhardt
Published Date:
Apr 9, 2024

The numbers are staggering and, now, Congress is moving to provide more funding to recover billions of dollars lost to pandemic aid fraud, The Washington Post reported.

The roughly $1.3 billion bill, authored by U.S. Sen. Dick Durbin (D-Ill.), the majority whip; U.S. Sen. Gary Peters (D-Mich.), chair of the Homeland Security and Governmental Affairs Committee; and U.S. Sen. Ron Wyden (D-Ore.), chair of the Finance Committee, would devote about $675 million toward guarding protecting programs from identity theft and lawmakers. It would allocate roughly $550 million to the Justice Department and leading inspectors general to bolster their oversight of federal spending. The bill would also give federal law enforcement officials additional powers and more time to investigate crimes targeting certain pandemic relief programs.

“Bad actors got their hands on money that was meant to help our communities get through what was an incredibly difficult time,” Peters told reporters, adding the proposal would help the government “get back stolen funds.”

The bill was introduced as the U.S. Department of Justice announced that it has charged more than 3,500 defendants, and seized or obtained forfeiture of more than $1.4 billion in illegally obtained coronavirus relief funds.

Last year, the Small Business Administration (SBA)’s Office of the Inspector-General (OIG) found that more than $200 billion in COVID-19 Pandemic Economic Injury Disaster Loans (EIDL) and Paycheck Protection Program (PPP) loans had been stolen or otherwise disbursed to fraudsters. That number represented 17 percent of all $1.2 trillion of these funds—$136 billion of $400 billion in EIDL funds and $64 billion of $800 billion in PPP funds—disbursed in the lives of the two programs.

Federal officials estimated that fraudsters stole $135 billion from the nation’s unemployment insurance program at the height of the pandemic, amounting to $1 of every $7 spent on jobless benefits, The Post previously reported.

Last week, the IRS Criminal Investigation division (CI) announced that it had recovered $8.9 billion in related cases through February as it continued to investigate COVID fraud, four years after the start of the pandemic. "In the last year alone, we have opened nearly 700 new COVID fraud investigations that collectively add up to $5 billion in potential fraud," said CI chief Guy Ficco.

Gene Sperling, a senior adviser to the president, attributed the rampant theft of taxpayer dollars to a lack of investment in federal technology, an overwhelming demand for federal aid and “the removal of several basic anti-fraud safeguards" at the start of the pandemic. That, he told Post, “led the Biden administration to inherit historic levels of fraud.”

In 2022, President Biden announced a new chief prosecutor for pandemic fraud at the Justice Department. The following year, he asked Congress to approve a $1.6 billion package that would toughen federal enforcement against coronavirus-related crimes, while bolstering U.S. aid programs to prevent future identity theft. The Justice Department has also ramped up its enforcement efforts, but Attorney General Merrick B. Garland stressed that the government’s work is still “far from over.”

Click here to see more of the latest news from the NYSSCPA.