$500 billion in fraud? Lawmakers worried not enough being done about pandemic loans

WASHINGTON, D.C. — New numbers show billions of dollars in government loans, flagged for fraud. The bigger concern may be what’s being done about it.

Members of Congress say the fraud is happening and little is being done to get that money back.

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In the height of the COVID-19 pandemic people turned to the government for help.

The latest government numbers show 15% of the forgivable loans sent to small businesses were flagged for fraud.

Members of Congress estimate it totals $525 billion but they worry something bigger is happening.

“Yet, the vast majority of stolen funds remain unrecovered,” Sen. Joni Ernst said.

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Miller looked deeper into the fraudulent loans and found that when people went online to apply for loans, $5.4 billion went to people using stolen social security numbers.

“Do you have adequate resources to do that with a flat budget,” Sen. Ben Cardin asked.

Lawmakers question whether enough is being done to try and reign in those funds. The leader of the Small Business Administration says changes have been made to try and do just that.

“I can tell you that the SBA is more strongly positioned to combat fraud, waste, and abuse across its disaster capital emergency programs as a result of these changes,” Isabella Guzman said.

Even at the height of the pandemic, the SBA said they were getting alerts about fraud.

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“Our office has received tens of thousands of complaints of wrongdoing on our hotline. Hundreds of investigations of fraud have been initiated in my office,” Mike Ware said.

But the question, what happened with those complaints?

Lawmakers want to make sure more systems are in place to get that money back and to prevent future fraud.

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