Secret Service reports nearly $100 billion stolen from pandemic relief funds

Nearly $100 billion has been stolen from COVID-19 relief programs established to help businesses and people who lost their jobs during the pandemic, the Secret Service said Tuesday.

This estimate of theft comes from Secret Service cases and data collected by the Department of Labor and the Small Business Administration, the Associated Press reported.

Roy Dotson, the national pandemic fraud recovery coordinator with the Secret Service, told the AP in an interview that the amount stolen from the total $3.4 trillion in pandemic benefits approved by Congress shows "the sheer size of the pot is enticing to the criminals."

Most of the stolen funds were taken through unemployment fraud. Statistics from the Labor Department show about $87 billion in unemployment benefits could have been paid wrongly, mostly because of fraud, the AP reported.

The Secret Service said it has seized $1.2 billion in the course of its investigations into unemployment insurance and loan fraud and has returned more than $2.3 billion in stolen funds by working with financial partners and states to reverse transactions. The agency also said it has more than 900 active criminal investigations into pandemic fraud. There are cases in every state, and 100 people have been arrested so far.

Other federal agencies are working to prosecute pandemic relief fraud as well.

The Department of Justice said last week that its fraud division has prosecuted over 150 defendants in more than 95 criminal cases. The department said it has seized over $75 million in cash proceeds derived from fraudulently obtained Paycheck Protection Program funds, as well as numerous real estate properties and luxury items purchased with money stolen from the PPP.

The PPP was a major component of the Coronavirus Aid, Relief, and Economic Security Act, passed by Congress and signed into law by then-President Donald Trump in March 2020. It was set up to provide $349 billion in interest-free loans to small businesses so that they could keep paying their workers while coronavirus lockdowns were in effect.

The Secret Service explained that law enforcement's focus has shifted over time. Early in the pandemic there was an emphasis on cracking down on personal protective equipment fraud. Now the priority for authorities is ending pandemic relief fraud, which has exploded since Congress approved massive relief spending that has caught the attention of criminals and organized criminal networks worldwide.

“Can we stop fraud? Will we? No, but I think we can definitely prosecute those that need to be prosecuted and we can do our best to recover as much fraudulent pandemic funds that we can,” Dotson said.