Fact Sheet: President Biden to Announce New Steps to Combat Criminal Fraud and Identity Theft in Pandemic Relief Programs
MAR 1, 2022 | REPUBLISHED BY LIT: MAR 5, 2022
LIT COMMENTARY
Biden should be going after the PPP Banks and Lenders who willingly did not perform even the basic of audits when reviewing applications.
It is lender application fraud as much as applicant fraud because the vast majority of the funds approved by lenders should have been denied.
The reason they were not denied is every application was earning at least a minimum fee of $2,500.
LIT has already highlighted one Texas lender who made so much money on fees and commissions, it is clear that they were aware of the fraud but greed prevailed. And not only that, they took a $376k PPP loan themselves, which has not been repaid.
Taxpayers are left with all the expense of investigations, lawsuits and housing felons for years, all because of lender fraud in approving these applications for their own monetary gain.
Bankers should be going to jail, but alas, LIT predicts it will be another 2008 – PPP Banks and Lenders and their executive staff will not be held accountable for their crimes.
STATEMENTS AND RELEASES
As part of an ongoing Administration-wide effort to prevent, deter, and punish identity theft and other forms of pandemic fraud by serious criminal syndicates, the President will announce in the State of the Union tonight:
The DOJ Will Appoint a Chief Prosecutor to Focus on the Most Egregious Forms of Pandemic Fraud Including Identity Theft by Criminal Syndicates:
The Department of Justice’s (DOJ) COVID-19 Fraud Enforcement Task Force will expand its already robust efforts by appointing a Chief Prosecutor to lead teams of specialized prosecutors and agents focusing on major targets of pandemic fraud, such as those committing large-scale identity theft, including foreign-based actors.
These strike force teams will also use state-of-the-art data analytics tools to connect the dots on identity theft and other complex fraud schemes committed across state lines or transnationally, as well as investigate major cases of criminal fraud in programs like the Paycheck Protection Program (PPP) and Unemployment Insurance (UI).
Heightened Resources and Enhanced Penalties for Egregious Pandemic Fraud in Areas Like PPP Loans and UI:
The President will call on Congress to provide the resources needed for the DOJ Task Force to expand prosecutions of egregious pandemic fraud, including in support of the strike force teams.
The DOJ has already successfully prosecuted scores of cases where individuals fraudulently obtained loans from PPP meant for small businesses facing threats of layoffs and closure due to the pandemic, and where identity thieves stole unemployment insurance benefits meant for those who lost their jobs through no fault of their own.
These criminal abuses took place at the same time that front-line essential workers were risking their lives to help us all get through the crisis.
The Administration will call on Congress to heighten the penalties for criminals who commit egregious pandemic fraud.
Executive Order on Preventing Identity Theft in Public Benefits Programs:
In the coming weeks, the President will announce a new Executive Order with broad government-wide directives, building on steps taken in 2021, to prevent and detect identity theft involving public benefits, while protecting privacy and civil liberties and preventing bias that results in disparate outcomes.
The EO will also direct new actions to support the victims of identity fraud.
Building on Existing Efforts to Crack Down on COVID-19 Fraud and Serious Identity Theft of Public Benefits:
The dramatic outpouring of pandemic relief in 2020 saw an expansion of foreign and domestic criminal syndicates defrauding unemployment insurance and other benefits programs to rob American taxpayers of billions of dollars that should have gone to support deserving small businesses and workers who had lost their jobs.
The Federal Trade Commission reported a 3000% increase in reports of identity theft involving public benefits from 2019 to 2020.
The Administration has taken significant actions already to respond to this inherited fraud.
Interagency COVID-19 Fraud Enforcement Task Force:
In May 2021, the President welcomed the Attorney General Merrick B. Garland’s announcement that the DOJ had launched the COVID-19 Fraud Enforcement Task Force to prosecute and recover stolen funds from domestic and international criminals exploiting pandemic relief programs.
The Task Force, which is organized and led by the Deputy Attorney General Lisa O. Monaco, includes nearly 30 agencies that administer and oversee pandemic relief funding, such as the Department of Justice, the Department of Labor, the Department of the Treasury, the Small Business Administration, the U.S. Postal Inspection Service, and the Pandemic Response Accountability Committee (PRAC).
So far, members of the Task Force have charged over 1,000 criminal cases and opened over 200 civil investigations across 1800 individuals and entities, together involving billions of dollars in suspected fraud.
The Task Force will appoint a Chief Prosecutor to lead investigations and prosecutions on identity theft and other egregious patterns of pandemic fraud.
Initiative on Identity Theft Prevention and Public Benefits:
On May 17, 2021, President Biden called for the ARP Coordinator and Office of Management and Budget, in consultation with the National Security Council (NSC), PRAC, Inspectors General, and the U.S. Government Accountability Office (GAO) to take government-wide steps to prevent individuals from defrauding public benefits programs.
This Initiative, working together with the cybersecurity team of the NSC, will be making government-wide recommendations as part of the President’s forthcoming Executive Order on preventing and detecting identity theft involving public benefits, while protecting privacy and civil liberties and preventing bias that results in disparate outcomes.
The Executive Order will also direct new actions to support victims of identity fraud.
Re-established Respect for and Transparency with Oversight Community:
This Administration has sought to re-establish respect and cooperation with the oversight community.
The White House American Rescue Plan Coordinator meets weekly with the PRAC, bi-weekly with leadership at the GAO, and has held over 20 “Gold Standard” meetings across federal agencies, where agency officials discuss integrity controls with their Inspector General and PRAC leadership before programs are launched.
This Administration has worked collaboratively to implement many recommendations from the oversight community, including strengthening controls for small business loan programs and directing multi-state data sharing to detect and fight UI fraud, while also screening a record number of benefits payments in programs across the government for potential fraud.
The White House Infrastructure Coordinator has also met with all the relevant Inspectors General impacted by the Infrastructure Investment and Jobs Act and committed to working closely together on fraud prevention efforts.
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