Politics

REPORT: Watchdog Finds Over $5 Billion In Potential Covid Relief Fraud

(Photo by Scott Olson/Getty Images)

James Lynch Investigative Reporter
Font Size:

The Pandemic Response Accountability Committee (PRAC) found 69,323 questionable Social Security Numbers (SSNs) allegedly used to obtain $5.4 billion in covid relief, according to a report.

PRAC released a fraud alert detailing how the potentially fraudulent accounts allegedly received money through the Small Business Administration’s (SBA) COVID-19 Economic Injury Disaster Loan (COVID-19 EIDL) program and Paycheck Protection Program (PPP). The relief programs combined provided $1.2 trillion to small businesses and their employees during the covid pandemic, according to PRAC data.

The suspicious disbursements were discovered by PRAC data scientists who went through more than 33 million COVID-19 EIDL and PPP applications, the report noted. They used Social Security Administration (SSA) data to identify potentially invalid SSNs used on the covid relief applications and asked SSA for verification information on 221,427 of the SSNs used on applications.

The additional 175,768 SSNs were used in covid relief applications that did not receive aid from the SBA but could be used to obtain benefits from future government programs, according to PRAC. (RELATED: NIH, EcoHealth Did Not Properly Monitor Taxpayer Funds, Inspector General Finds)

COVID-19 EIDL and PPP relief programs were authorized by the Coronavirus Aid, Relief, and Economic Security Act of 2020 (CARES) and the SBA urgently worked to distribute relief, making the programs more susceptible to fraud, the report noted. Under the CARES Act, the PRAC has legal authority to provide oversight of covid relief spending.

The SBA provided $378 billion in EIDL relief and over $800 billion in PPP loans to 11 million small businesses. PPP applications ended on May 31, 2021 and EIDL applications closed on January 1, 2022, according to the report.

On Wednesday, the House Oversight Committee, led by Republican Kentucky Rep. James Comer, will conduct its first hearing on covid-related fraud and abuse.