More Funding Needed to Prosecute Pandemic Fraud, Justice Dept. Says

The Justice Department said more than $1.4 billion in stolen relief funds have been seized or forfeited. But estimates of the total stolen run into the tens of billions.

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Attorney General Merrick B. Garland said the Justice Department was “committed to continuing our efforts to investigate and prosecute pandemic relief fraud” on Tuesday.

More resources are needed to investigate and prosecute individuals who stole billions in pandemic relief funds, the Justice Department said in a report on Tuesday.

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, according to the report.

The federal government, which distributed trillions in relief funds after the onset of the pandemic, has charged more than 3,500 defendants for offenses related to pandemic fraud, according to the report. That’s up from about 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 have involved 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.”

The Government Accountability Office said that as much as $135 billion of the roughly $900 billion in unemployment benefits distributed between April 2020 and May 2023 were likely illegally claimed.

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