300 Arrested in $830 Million COVID Aid Fraud Scheme

The United States will never have a complete accounting of COVID-19 fraud. The government doesn’t want to know. It is criminal that those who are supposed to be guardians of public funds have gotten away with so much incompetence, with very few federal employees losing jobs.

The best guess is that taxpayers have lost $300 billion or more to fraud. Budget watchdogs have deemed at least $125 billion to be “wasted”. Whose heads should roll?

Not Julie Su, the former head of the California Labor and Workforce Development Agency whose department doled out $180 billion in unemployment claims during the pandemic. Of that $180 billion, more than $32 billion was fraudulently given out. At least $2 billion went to inmates in various state prisons despite the criminals being ineligible for the cash. But Ms. Su is being rewarded for her incompetence and stupidity by being nominated to serve as Secretary of Labor.

Michael Horowitz told the AP that if you opened up the bank’s window and said, “Give me your application, and just assure me that you’re who you claim to be, you’ll attract a lot of fraudsters. That’s exactly what happened in this case.”

The same Justice Department boasts about a “COVID Fraud Sweep” in which 300 people were arrested after stealing an aggregate of $830,000,000. This is a mere drop in the pond — or a bucket about the size of Texas.


At a Wednesday roundtable of law enforcement officials, Deputy Attorney-General Lisa Monaco said that 30 members of a Wisconsin street gang allegedly used the money they received from an unemployment fraud scam to hire murderers and buy firearms and drugs.

Monaco reported that four individuals were also charged with a scheme to launder money and commit international pandemic relief fraud involving Nigeria.

Damn! Maybe that “Nigerian Prince” from that email needed help in washing his money after all.

According to a DOJ release, many of the individuals who were targeted are accused of applying fraudulently for assistance under the Paycheck Protection Program or Economic Injury Disaster Loans that supported small businesses during the pandemic.

In June, a government watchdog estimated that fraudsters had stolen over $200 billion of loans meant for struggling businesses. This is 17% of the total $1.2 trillion loaned.

Estimates of fraud in the Paycheck Protection Program are $64 billion. The Economic Injury Disaster Loan Program fraud estimate is over $136 billion. This represents 33% of the total amount spent. More than $200 billion fraud in two programs — and counting.

Do not worry about California inmates or other prisoners from other states. The Justice Department is on the case!

At a Wednesday round-table of law enforcement officials, Lisa Monaco, Deputy Attorney General said: “We will pursue judicial orders that require convicted defendants pay back each dollar stolen. We have 20 years to recover these funds.”

We probably won’t live to see the day when the government figures out how much COVID-19 money was stolen.

Mike Galdo is the acting director of COVID-19 Fraud Enforcement at the Department. He stated, “Based on the scope of fraud that we have seen, I do not see an end to our work.”