Government Ramps Up Enforcement Efforts on COVID-19 Relief Fraud
The federal government is substantially ramping up its enforcement of COVID-19-related fraud. In a press release issued yesterday, the United States Secret Service announced the naming of a “National Pandemic Fraud Recovery Coordinator” to “bolster” the “fight” against COVID-19 fraud. As part of its announcement, the Secret Service noted that “to date, Secret Service investigations and investigative inquiries into [Unemployment Insurance] and [Small Business Association (SBA)] loan fraud have resulted in the seizure of more than $1.2 billion and the return of more than $2.3 billion of fraudulently obtained funds” and that these investigations have led to the arrest of 100 individuals responsible for COVID-19-related loan fraud.
This announcement comes on the heels of multiple Department of Justice enforcement actions relating to COVID-19 fraud, including the December 15, 2021, unsealing in a Houston federal court of a broad-ranging indictment charging four individuals for fraudulently obtaining and laundering millions of dollars in forgivable Paycheck Protection Program (PPP) loans guaranteed by the SBA under the Coronavirus Aid Relief and Economic Security (CARES) Act. That indictment is only the latest in a series charging a conspiracy that now amounts to 15 participants.
While DOJ and the Secret Service often get the most press for COVID-19 fraud enforcement efforts, numerous other agencies have joined these enforcement efforts, including the SBA–Office of Inspector General (SBA-OIG); Federal Housing Finance Agency–Office of Inspector General (FHFA-OIG); Homeland Security Investigations (HSI); Federal Deposit Insurance Corporation–Office of Inspector General (FDIC-OIG); Treasury Inspector General for Tax Administration (TIGTA); and the U.S. Department of Labor, as well as the Pandemic Response Accountability Committee (PRAC) established under the CARES Act to, among other things, detect and prevent fraud, waste, abuse, and mismanagement of COVID-19 funds.