US Covid-19 relief funds lost to fraud, waste

(MENAFN) During a congressional hearing on Thursday, the directors of three United States government agencies testified that over USD250 billion in COVID-19 relief funds were lost due to "fraud" and "waste." The figures given were an underestimation of the actual amount lost, as they did not include the defrauded amount from the Pandemic Unemployment Assistance program. The Small Business Administration (SBA) alone uncovered USD190.7 billion in potential fraud across its jurisdictional relief programs. The Paycheck Protection Program is expected to have accounted for upwards of USD100 billion in fraudulent activity.

Acting Treasury Inspector General Richard Delmar admitted that the USD2.6 billion in confirmed dubious charges was just the tip of the iceberg, with ongoing audits precluding a full cost estimate. Larry Turner, inspector general of the Department of Labor, attributed the massive losses to a lack of preparation, insufficient oversight, and the government's generosity. Turner made a "highly conservative" estimate of USD76 billion in fraudulent spending, adding that the program's unprecedented infusion of federal funds made it irresistible to fraudsters.

The hearing revealed that the country's relief program had become the "biggest fraud in a generation," and the lack of a functional system to verify applicants' details in a reasonable timeframe made it easier for fraudsters to take advantage of the situation. The directors of the agencies emphasized the need for increased oversight and safeguards to prevent further abuse of the relief program.

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