White House downplays Secret Service estimate of COVID fraud



The White House has played down a statement by the US secret service that at least nearly $ 100 billion has been stolen …

The White House played down a statement by the U.S. Secret Service that a minimum of nearly $ 100 billion was stolen from COVID-19 relief programs, saying on Wednesday that the estimate is based on old reports.

White House press secretary Jen Psaki, when asked to comment on the figure, said: “There is no new research, data or fraud analysis here.”

The Secret Service told The Associated Press on Tuesday that the estimate was based on Secret Service cases and data from the Department of Labor and the Small Business Administration.

A spokesperson for the agency said on Wednesday they were not changing a statement on their website, but added a clarifying note to explain that the figure is based on reports from the Department of Labor and Small Business Administration and that the secret services did not produce a new report. .

“There is no correction to be made, we have just published explicitly on the press release’s webpage the same information that we discussed yesterday”, wrote Justine Whelan, spokesperson for the secret service, in an e-mail. Wednesday.

Psaki said that “there was only an addition” of two old reports on well-known issues involving small business loans and unemployment insurance payments. “It’s also important to note that even these two older analyzes combined payments that included over and underpayment errors, but this was a reference to two older IG reports.”

The Secret Service did not include the COVID-19 fraud cases prosecuted by the Justice Department in its estimate on Tuesday.

COVID-19 relief programs have been put in place to help businesses and people who have lost their jobs due to the pandemic.

Roy Dotson, the new National Pandemic Fraud Recovery Coordinator for the Secret Service, discussed the fraud in an interview on Tuesday. While about 3% of the $ 3.4 trillion has been dispersed, the amount stolen from pandemic benefit programs shows that “the sheer size of the pot is attractive to criminals,” Dotson said.

Most of this figure comes from unemployment fraud. The Labor Department reported that around $ 87 billion in unemployment benefits could have been inappropriately paid, with a significant portion attributable to fraud.

The Secret Service said it seized more than $ 1.2 billion in an investigation into unemployment insurance and loan fraud and returned more than $ 2.3 billion in funds fraudulently obtained while working with financial partners and states to cancel transactions. The Secret Service says it has more than 900 active criminal investigations into pandemic fraud, with cases in every state, and 100 people have been arrested so far.

The Justice Department said last week its fraud section prosecuted more than 150 defendants in more than 95 criminal cases and seized more than $ 75 million in cash from the paycheck protection program funds obtained fraudulently, as well as many purchased real estate and luxury items. with the product.

One of the best-known programs created by the CARES law of March 2020, PPP offered low-interest loans and repayable loans to small businesses struggling to keep up with the payroll and other costs. expenses during closures related to the pandemic.

The Pandemic Response Accountability Committee brings together officers from its 22 member Inspectors General to investigate fraud involving a variety of programs, including the PPP. They have led or participated in investigations into fraud linked to a pandemic that resulted in 818 arrests, 1,134 indictments and 391 convictions, the committee announced on Tuesday.

At the start of the pandemic, law enforcement focused on personal protective equipment fraud, the Secret Service said. Authorities have now prioritized harnessing pandemic relief because federal funding through the CARES Act has caught the attention of individuals and organized crime networks around the world.

Dotson, who is the Deputy Secret Service Special Agent in charge of the agency’s field office in Jacksonville, Fla., Said that while they can’t stop the fraud, they can prosecute those who need to be prosecuted and recover as much fraudulent pandemic funds as they can.

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Associated Press writers Darlene Superville and Alexandra Jaffe contributed to this report.

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