Taxpayers Have Likely Lost $100 Billion in COVID Funds to Fraud

As Congress prepares to jam through another $1.9 trillion in COVID stimulus relief, a new report from NBC News shows that we may be throwing good money after bad. Prosecutors all over the country are launching investigations into large-scale unemployment fraud programs that may have robbed as much as $100 billion from last year’s CARES Act. According to the report, “the scale of the fraud in the unemployment program created by the CARES Act has reached a staggering level.”

The report kicks off with a specific example from Orange County, California, where a group called Nguyen Social Services got away with millions of dollars by charging people “up to $700 a pop to file false unemployment claims” for people who didn’t actually qualify for the COVID relief funds. But Orange County District Attorney Todd Spitzer said that Nguyen’s fraud was only the tip of the iceberg.

“This isn’t just an Orange County problem. It isn’t just a California problem,” said Spitzer. “This is a breakdown of catastrophic proportions that has failed the American taxpayer.”

The Labor Department is currently conducting an investigation, but early reports suggests that – at the very least – $63 billion of COVID funds have been lost to fraud. The NBC report says that the “full scope of the loss of taxpayer funds” may actually be north of $100 billion.

“A rush to release the funds put enormous strain on state workforce agencies, creating a bonanza for individual scam artists and international cybercrime rings,” the report noted.

Okay. Um, maybe we should have spent a little more money on protecting against fraud and a little less on gender programs in Pakistan or whatever it was Congress stuffed into the last omnibus, huh?

“In California, this is unquestionably the largest fraud against public agencies in our history,” said president of the California District Attorneys Association, Vern Pierson. “Increasingly we are learning there could be fraud of historic proportions nationwide. While we don’t know the exact price tag, we know the amount of the loss of taxpayers is staggering.”

Fantastic.

We know that Democrats are chomping at the bit to put Trump on trial for inciting the riot or putting kids in cages or letting Ivanka plug her jewelry (or whatever is supposed to be his crime this week), but if Biden really wants to put the Justice Department to good use, he’ll encourage Attorney General Merrick Garland to investigate and prosecute this widescale theft. Especially if we’re getting ready to watch another $1.9 trillion go out the door.