FINANCE
Investigation into the biggest fraud in the history of the United States: Billions stolen
An AP analysis found that of the $4.2 trillion in covid-19 relief, $280 billion was stolen in one of the country’s largest defraudings.
During the covid-19 health emergency, the US government approved three economic bailouts with the aim of offering assistance to the millions of Americans who could not go to work.
In total, the three bailouts resulted in $4.2 trillion dollars being earmarked for economic relief, of which $280 billion was stolen while another $123 billion was wasted or misspent, according to an investigation by the Associated Press (AP).
According to the aforementioned outlet, this represents the biggest fraud in the history of the United States, which leads us to question how can so much money be stolen and is anything being done about it?
The biggest fraud in US history
Well, experts on the matter told AP that the government, in trying to rapidly distribute billions in aid, failed to adequately oversee the distribution of the funds, because there were very few requirements for those applying for help, resulting in “a scam that is too easy.”
Most of the theft occurred through the stimulus checks , which were introduced by the Trump Administration and followed by the Biden Administration. In total, the country approved three stimulus checks, one for $1,200, another for $600 and the last for $1,400.
Extended unemployment benefits also accounted for a fair share of theft, as did the Paycheck Protection Program (PPP), a program designed to provide loans to small businesses with the goal of supporting their employees. employees on the payroll during the covid-19 labor crisis.
Michael Horowitz, Inspector General of the US Department of Justice, noted that the fraud is “clearly in the tens of billions of dollars” and could well exceed $100 trillion in dollars due to the ease with which aid was accessed.
“If you open the bank window and say, give me your application and just promise me that you really are who you say you are, you attract a lot of scammers and that’s what happened here,” Horowitz said.
The investigation emphasizes that not only criminals and gangs posed as other people to collect money they didn’t need, so did “an American soldier in Georgia, the pastors of a defunct church in Texas, a former state legislator in Missouri, and a roofing contractor in Montana.”
Due to the disastrous result, Gene Sperling, coordinator of the American Rescue Plan at the White House, pointed out that “the prevention strategy in the future is that, in a crisis, [the government] you can focus on fast delivery to people in dire straits without bypassing common sense fraud hurdles”.