Biden Requests $1.6 Billon to Cover Fraudulent COVID Relief Programs

In March 2023, the White House announced the Biden Administration’s intent to request a total of $1.6 billion to tackle the “historic levels” of fraud within COVID relief programs. As President Biden prepares to address Congress, Republicans and Democrats alike are uniting to hold wrongdoers accountable, as fraudulent activity has allowed many criminals to profit off of the trillions of dollars invested into these economic relief programs.

Biden’s Proposal: An Overview

Biden’s proposal includes a funding request for $1.6 billion. The Biden Administration has stated its intent to allocate the funds as follows:

• $600 million to federal watchdogs and law enforcement agencies. Biden intends to allocate this amount to federal inspectors and police departments to help provide the tools and resources necessary to bring criminal prosecution for “the most serious and sophisticated” pandemic fraud cases.
• Triple the size of strike force teams. Biden’s proposal would triple the size of the Department of Justice’s strike force teams, who recently recovered $286 million in stolen funds in addition to some “equally important” cases.
• $600 million to fraud and identity theft protection. This allocation is intended to bolster anti-fraud and identity theft programs by improving analytics, detection, and verification services, in addition to assisting with the retrieval of stolen payments.
• $400 million to aid victims of identity theft. The White House stated an intent to provide aid to those dealing with financial hardships, sinking credit scores, unexpected tax debts, and intense stress as a result of fraudulent acts.

Biden’s proposal also requests a 10-year extension of the statute of limitations for serious pandemic fraud, including unemployment fraud. Currently, this time period is set to expire in 2025.

Pandemic Fraud Estimated at $5 Billion

Senior Advisor Gene Sperling said that after inheriting a “historic degree” of fraud from the Donald Trump Administration, the Biden Administration has been focused on navigating the unfortunate fallout from day one. “On the whole, these programs did enormous good,” he explains, “but we also learned there were cases where guardrails were lowered that led to unnecessary and, in some cases, large-scale fraud.”

According to the Pandemic Response Accountability Committee, the amount of “potentially fraudulent” loans issued during the pandemic totals a staggering $5 billion. This may come as no surprise, given that the Trump Administration disbursed 57,000 loans totaling $3.6 billion in 2020—without completing any of the necessary checks against existing databases. This is one testament to a lack of due diligence that would have otherwise uncovered and prevented many of these potential scams.

Over $5 trillion was invested to keep the U.S. economy afloat during the pandemic. Not only was this the largest recorded flood of federal funding, but it was disbursed hastily, leaving many agencies struggling to keep up and detect fraudulence. Not only did the pandemic relief include aid for businesses, unemployment support, and assistance for state, local and tribal governments, but it also included direct funding to individuals, including more than 476 million stimulus checks totaling $814 billion.

Since the House Republicans regained control of Congress, they’ve made uncovering COVID fraud a top priority. However, the effort is not a joint one, as it has been reported as separate from the White House's. With a closely divided Congress, even the presence of shared objectives may not be enough to break through partisan barriers. . This has led to an increase in investigations and charges for PPP Loan Fraud and EIDL Loan Fraud which were two of the most commonly funded loans during the COVID Pandemic.

Aggressive Representation for the Accused in Florida

For almost a decade, our accomplished team at Hubbs Law, P.A. has provided relentless advocacy for Floridians in need. Our criminal defense and immigration attorneys have extensive experience representing the accused in Miami and beyond in a wide range of cases, from fraud charges to drug charges.

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