A government watchdog is raising questions about potential fraud in how the government gave out tax dollars to help businesses during the height of the pandemic. A new report now says “questionable” social security numbers were used to obtain billions of dollars in business loans.
Investigators with the Pandemic Response Accountability Committee, or PARC, are calling this a fraud alert. They’re concerned about loans totaling $5.4 billion dollars of taxpayer money.
You’ve probably heard of the PPP or Paycheck Protection Program and the COVID-19 Economic Injury Disaster Loan or COVID-19 EIDL. Both aided small businesses and their employees during the pandemic.
For many, they were a lifeline that saved jobs and entire businesses.
Now, this new watchdog report says data scientists identified 69,323 “questionable” social security numbers that were used to get this aid. It is paid for with your tax dollars.
“A lot of what was wasted during the pandemic was preventable,” Tom Schatz, president of Citizens Against Government Waste, said.
The report points to social security numbers that were either not issued by the government or did not match government records. That means there’s also a potential for identity theft.
There’s no question $5.4 billion is a lot of money. The government gave out $1.2 trillion to help small businesses with these programs. So, the number in question is .4499% of that total.
“This is not about how much has been wasted,” Schatz said. “This is about preventing waste in the first place. The government simply doesn’t have in place anything that stops money from going out to the wrong people.”
The group now says it will work with investigative and law enforcement partners to learn lessons, so this does not happen in future emergencies.
“It’s the way the federal government hands out money without worrying about whether it’s wasted because it’s not their money,” Schatz added. “No small business, no private business would handle payments like the federal government does and it’s really unfair to taxpayers.”
The chair of PARC is scheduled to testify on Capitol Hill Wednesday.
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