Posted on 10/22/2023 9:57:32 PM PDT by SeekAndFind
Anti-waste and fraud controls were so lax on trillions of tax dollars being spent by federal and state government agencies on COVID-19 pandemic relief benefits that as much as half of those funds actually went to entities in China, Russia, and other U.S. adversarial nations, a congressional panel was told on Thursday.
"Data on this is still being evaluated, but there are some estimates that half of the Pandemic unemployment assistance fraud went to adversarial nations," said Linda Miller during testimony on Oct. 19 before the Oversight Subcommittee of the House Ways and Means Committee.
Her comments came in response to a question from Rep. Brian Fitzpatrick (R-Pa.) concerning a recent federal prosecution of a group of Chinese government-linked hackers who stole an estimated $20 million in relief funds.
Ms. Miller is the former Deputy Executive Director of the Pandemic Response Accountability Committee (PRAC) in the Department of Justice (DOJ). Michael Horowitz, the DOJ Inspector General, heads the PRAC office. She is also the former Assistant Director of the Government Accountability Office's (GAO) Forensic Audits and Investigative Service group. She is now an anti-waste and fraud expert consultant.
"The nearly $5 trillion in government relief spending during the COVID-19 pandemic—much of which was disbursed as direct payments to citizens—created the perfect storm for fraud. A combination of inadequate oversight and internal controls, large-scale organized fraud rings, and antiquated data and information systems contributed to the massive, widespread fraud we saw during the pandemic," Ms. Miller told the subcommittee during her prepared testimony.
"Agencies were unprepared for the fraud they encountered largely due to a lack of attention on fraud risks. GAO issued its Framework for Managing Fraud Risks in Federal Programs in 2015, but regrettably, little attention was paid to establishing the preventative controls GAO called for to manage fraud risks," Ms. Miller testified.
Rep. David Schweikert (R-Ariz.) the subcommittee's chairman, recalled a telephone call he received during the pandemic from his wife, who managed an Arizona surgery center with 20-30 employees.
"'You know, I am here handling all of these unemployment applications," Mr. Schweikert recalled his wife telling him. "A lot of them were from people who had never worked there or who had not worked there in years. But the best one was when she was getting unemployment benefit requests for herself."
At that point, Mr. Schweikert said, his wife asked, "Do you want me to quit now because apparently I am already asking for unemployment." The Arizona Republican said his wife later added up all of the fraudulent benefit application verifications that were received for her surgery center and found "there were hundreds."
Mr. Schweikert said the oversight subcommittee "has been tracking some crazy stories of [pandemic relief] unemployment insurance fraud that was converted to gift cards that was moved into buying cars, and the cars were shipped over to Africa as a way to wash the money." He added that the subcommittee has found evidence that foreign entities have stolen funds from the U.S. pandemic relief programs and channeled them into support of violent overseas activities.
Rebecca Shea, GAO's Director of Audits, Forensic Audits, and Investigative Services, told the hearing that her office has examined DOJ prosecutions of pandemic fraud and "so we have some information about foreign actors exploiting the various pandemic relief programs."
In her prepared testimony, Ms. Shea told the subcommittee that federal program managers who are directly responsible for identifying and stopping fraud were focused almost entirely on getting benefits processed and in the hands of beneficiaries, even though there are multiple federal laws and regulations requiring federal workers to take measures to prevent tax dollars from going to ineligible recipients.
"Federal agencies did not strategically manage fraud risks and were not adequately prepared to prevent fraud when the pandemic began. We recognize that eliminating all fraud and fraud risk is not a realistic goal. However, a variety of resources and requirements for fraud risk management were in place well before the pandemic. Had agencies already been strategically managing their fraud risks, they would have been better positioned to identify and respond to the heightened risks that emerged during the pandemic," Ms. Shea testified.
Amy Simon, who worked in the Department of Labor's Employment and Training Administration (ETA) during the pandemic, testified that officials still do not know the actual full extent of pandemic benefit fraud.
"The scale of improper spending and outright fraud is only now coming into clearer focus. Official federal estimates, while still preliminary, are astonishing. Based on an assumed improper payment rate of more than 21 percent, government officials have conservatively estimated at least $191 billion in improper payments during the pandemic," Ms. Simon told the panel.
"However, that figure is expected to rise, likely to $240 billion or more, following a recent GAO report that found that the Pandemic Unemployment Assistance (PUA) program had an even higher improper payment rate of almost 36 percent. GAO separately estimates between $100 billion and $135 billion in unemployment benefits were lost to fraud during the pandemic, or approximately one in every seven dollars in benefits paid," she said.
In response to a question from Rep. Greg Steube (R-Fla.), Ms. Simon said, "Pandemic fraud is effectively a vertical for many criminal organizations, and it is an income source. There was a recent DOJ indictment in Michigan of a sprawling scheme that was funded by multiple kinds of pandemic fraud that had murder-for-hire as one of its services. So these are not run-of-the-mill, someone down the street claimed a few extra weeks they shouldn't have. It is serious organized crime rings."
Shocked. Free money went into undeserving pockets??? Isn’t that the whole point of the scheme?
Average citizen doesn’t have the wherewithal to figure out how to massively defraud the US government.
My guess it was an inside job.
Remember, China is a criminal enterprise country.
I saw fraud out the wazoo in Houston in 2009 in the form of new cars driven by newly rich black ACORN green grocers. But there were no ACORN green grocery stores to be found except closed store fronts in some places.
This is the problem when the gooeberment gives away money that isn't theirs. They can't control it and can't be responsible with it. They waste it. They couldn't manage a piss up in a pub. Bureaucraps and politicians are miserable worthless failures who can't do an honest job.
The government can’t give our money away fast enough — except to middle class Americans. All we get is the privilege of handing over our hard-earned money so the government can send it to our adversaries overseas or to fill the pockets of special interests and politicians.
Wonder about 10% ?
OMG. The scale of fraud is unbelievable.
True. But in this case, one can hardly blame them. Money being thrown around wildly - why not catch some?
The money went to an address. It can be recovered if the gov’t wants it recovered.
You say, “Remember, China is a criminal enterprise country.”
I say, “Remember the FBI is a criminal enterprise institution.”
and then there’s the money- Laundering schemes in Ukraine, and Middle east
No it isn't. It explains everything. How did the swamp grow to inundate the battlefields of Manasas? To keep a corruption ring going everyone wants his piece of the action, not just the big guy. The mess in the so-called Republican leadership, the entrenchment of McConnell and Rona is all part of this flood-tide of corruption. This fighting the wrong war in Ukraine against the wrong enemy Russia while ignoring the threat of China into whose arms we drove the Russians is all part of this flood-tide of corruption in DC.
You can’t get $2T in cash. It’s all bank transfers that can be traced.
HOW BIDENS SAP-HAPPY COVID-19 BENEFITS GIVEAWAY WORKED
Paycheck Protection Program — Small Business Administration
<><>Provided small businesses with loans for up to eight weeks
<><> included all payroll costs, including benefits, to help them during the COVID-19 pandemic.
<><>The money also could be used to pay rent, utilities and mortgage interest.
<><>The loans provided the lesser of $10 million or 2.5 times monthly payroll costs.
<><>often forgiven, didn’t have to be repaid, if businesses said they retained employees for a certain period.
<><>A company in the program could not have more than 500 employees.
Economic Injury Disaster Loan — SBA
<><>Provided loans of up to $2 million to help small businesses recover from the economic impacts of the pandemic.
<><>The loans were not forgivable. But small businesses also could get grants of up to $10,000 that didn’t need to be repaid.
<><>The company could not have more than 500 employees.
Pandemic unemployment assistance — joint federal-state program
<><>In California one of the biggest targets of unemployment fraud during the pandemic, the program provided 86 weeks of benefits from Feb. 2, 2020, to Sept. 4, 2021, with a standard weekly benefit of $167 to $450.
<><>In Illinois, the standard weekly benefit was $51 to $484, also ending in September 2021.
SOURCES: U.S. Small Business Administration, California Employment Development Department, Illinois Department of Employment Security
Biden’s trillion dollar COVID-19 relief funds went to gangs, fueled Chicago’s illegal gun market, even financed a mob hit
In Chicago, the price of illegal guns soared during the pandemic, but gangs were able to pay for them with COVID-19 relief money obtained fraudulently, agents say.
When COVID-19 struck in 2020, the Biden government quickly put together massive aid programs to help struggling businesses, along with the people who lost their jobs.
But other kinds of enterprises with names like the Traveling Vice Lords and the Wild 100s — criminal street gangs in Chicago and across the country — soon figured out how to take advantage of that safety net. They defrauded those programs of millions of dollars that they used to buy guns and drugs, according to the U.S. Justice Department and court records.
Incarcerated crooks were in on the act, too. The government estimates that, across the country, at least one-quarter of a billion dollars in fraudulent unemployment insurance benefits went to inmates in federal prisons.
snip
OMG. The scale of fraud is unbelievable.
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Indeed.
Grifted/19
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