The multifaceted toll of government mishandling of the Covid-19 pandemic grows ever larger.
Last week brought another grim report on learning loss among children victimized by needless school shutdowns. On Tuesday, we learned that fraudsters scooped up more than $200 billion in Small Business Administration (SBA) Covid-19 relief money, according to a report from the SBA's Office of Inspector General.
That represents a whopping 17% of the $1.2 trillion dished out by the SBA via Economic Injury Disaster Loans (EIDL) and the Paycheck Protection Program (PPP). The knowledge of major fraud in the SBA programs isn't new, but the latest estimate of the damage is well higher than previous estimates.
One passage in the OIG report strikes a strong "I told you so" tone, with the SBA taken to task for ignoring the OIG's warnings:
"Office of Inspector General (OIG) reports issued very early on warned of the importance of a strong internal control environment to mitigate fraud risk...
[However,] the agency weakened or removed the controls necessary to prevent fraudsters from easily gaining access to these programs and provide assurance that only eligible entities received funds."
The report offers examples of various types of fraud. One "sprawling conspiracy" centered on claims submitted for 1,300 fake businesses; its masterminds stole $140 million and the OIG said the estimate could rise to $625 million.
In another episode, a female US Army Chief Warrant Officer at Fort Stewart, Georgia teamed up with several other crooks to "scam the system 150 times over, securing $3 million for herself and those involved in the conspiracy," the reports says.
The OIG says its investigations have thus far contributed to 803 arrests, 529 convictions and the recovery of $30 billion, with tens of thousands of leads still being worked.
The SBA accused its own watchdog of wildly overestimating the fraud, saying its own math suggests about $36 billion on fraud. Looking far more focused on defense than accountability, the agency also endeavored to claim that 86% of its fraud estimate took place while Trump was still in office.
The SBA OIG attributed $136 billion of the fraud to the EIDL program, which provided long-term, fixed-rate, low-interest loans to small businesses. Another $64 billion in fraud hit the PPP, which dished out loans to small businesses, individuals and nonprofits that were "affected" by the pandemic.
"About 1.6 million EIDL loans worth $114 billion are either past due, delinquent or in liquidation as of May, according to the report. More than 69,000 of these loans worth $3.2 billion have been written off. And more than 500,000 PPP loans have defaulted" -- CNBC
The SBA was just one of many government patsies hit with major fraud during the Covid-19 welfare orgy. In September, the Department of Labor OIG said some $45.6 billion in unemployment insurance was devoured by thieves whose handiwork included using the Social Security numbers of 205,766 dead people.
The Department of Agriculture was hit by one of the largest single scams, with more than 40 people linked to a Minnesota non-profit called Feeding Our Future charged with plundering $250 million from a program meant to feed needy children during the pandemic by operating upwards of 250 fake meal-assistance locations.
We all pay the price of the government's Covid-relief incompetence, as the hundreds of billions of stolen money was created by the Federal Reserve, sapping everyone's purchasing power and imposing what is ultimately a stealth tax with no maximum rate.
