The Secret Service said Friday it has helped recover and return to the government nearly $2.3 billion in bogus pandemic benefits, including a major new operation that netted nearly $300 million in fraudulent small business loans.
Agents in the Secret Service’s Orlando, Florida, office noticed that fraudsters were using a particular payment system, Green Dot Bank, to move their money around. Working with the bank, the service said it identified more than 15,000 accounts that were being used to funnel money stolen by fraud.
Agents seized $286 million from those accounts and returned the money to the Small Business Administration.
The government doled out about $835 billion in Paycheck Protection Program loans and allocated another $500 billion for Economic Injury Disaster Loans, both of which were meant to keep smaller businesses afloat during pandemic shutdowns.
Another $718 billion went out the door for enhanced unemployment benefits.
All of those programs were beset with major fraud.
Though the government is still trying to come up with a good estimate for how much money was actually stolen, early conservative estimates for the PPP put the fraud figure at about 10%. Estimates for unemployment fraud run as high as $400 billion, though analysts say somewhere north of $200 billion is more realistic.
Little has been recovered.
The $2.3 billion the Secret Service says it recaptured would be about 3% of the total PPP fraud.
Prosecutions and convictions are beginning to pile up, albeit at a tiny fraction of the total estimated fraud.
One common theme among the prosecutions is the conspicuous consumption of those who stole from taxpayers, with thieves buying luxury cars and property or paying for plastic surgery and shopping sprees.
The government usually moves to seize vehicles or property they can trace back to pandemic fraud. But much of the money has been sent overseas, making its recovery almost impossible.
A 39-year-old immigrant from Pakistan pleaded guilty in California this month to collecting more than $6.6 million in bogus PPP loans. Authorities said he filed 11 fraudulent EIDL and PPP applications for seven shell companies, lying about his employees and what he wanted to use the money for.
Investigators say Muhammad Noor Ul Ain Atta submitted some of the loan application under a stolen identity, using the name of someone who has been sitting in Illinois prisons or jails since 2008.
Authorities said Atta wired about $6 million to Pakistan, saying the money was for “family support.”