The White House on Tuesday released a sweeping summary of findings from the House Select Subcommittee on the Coronavirus Pandemic, arguing that a laboratory-related incident remains the most likely origin of COVID-19. 

The findings also revealed that the U.S. government spent more than $5 trillion on COVID-19 relief, and an estimated $391 billion of it was fraudulently taken or improperly paid. 

The visual above comes from a White House summary of the House Select Subcommittee on the Coronavirus Pandemic findings.

NOTE: These are watchdog estimates, not confirmed recovery figures. Not all improper payments represent intentional criminal theft. But the scale of what the watchdogs found is the story.

TL;DR

• The U.S. government estimates roughly $391 billion was lost to fraud and improper payments across its major COVID-19 relief programs.
• Criminal charges have been brought against only 371 defendants for a combined alleged total of $836 million, less than half a percent of the estimated losses.
• Unemployment insurance fraud, estimated at at least $191 billion by the Department of Labor’s Inspector General, is three times larger than PPP fraud yet received far less public attention.

Financial Waste Estimates in Major COVID-19 Federal Relief Programs

ALSO READ: Visualized: All the World’s Active Pandemics and Epidemics

The Program that Raises Questions

The federal Paycheck Protection Program (PPP) fraud dominated public conversation from 2020 onward. 

The unemployment insurance system was the quieter catastrophe. 

At least $191 billion in UI fraud (against a total $872 billion in UI benefits allocated) means the DOL IG estimates that more than one in five dollars paid through the unemployment system was fraudulent or improper, according to the White House summary. 

The GAO put the baseline fraud rate at 11 to 15%, but the improper payment rate rose to 18.71% and then reached 21.52% in 2022. 

The controls did not improve as the programs ran. They deteriorated.

The Pandemic Unemployment Assistance (PUA) program, which extended benefits to gig workers and freelancers who did not qualify for traditional UI, recorded an improper payment rate of 35.9% in August 2023, according to the White House summary. 

More than one in three dollars paid through PUA was improper. 

PUA was designed without the documentation requirements that traditional UI carried, deliberately stripped back to reach recipients faster. 

The 35.9% figure is the cost of that decision made visible.

SBA’s one-in-six problem

Of the $1.2 trillion the U.S. Small Business Administration (SBA) disbursed through Economic Injury Disaster Loans (EIDL) and PPP combined, approximately $200 billion is estimated as fraudulent, according to the White House summary. 

PPP alone disbursed $813.7 billion, of which the SBA Inspector General estimates at least $64 billion was fraudulently obtained. 

The program approved loans within days, with documentation requirements relaxed to accelerate disbursement. 

The largest single PPP fraud case in the dataset involved six individuals who generated more than 1,100 fake paychecks to fraudulently obtain $20 million.

ALSO READ: Eli Lilly Nears $1 Trillion Valuation on Weight-Loss Drug Dominance

Foreign Hands in American Relief Funds

The dataset records three international fraud cases that sit at the extreme low end of the dollar scale but the extreme high end of political significance. 

• Chinese government-linked hackers operating under the group designation APT41 stole $20 million in COVID relief funds, according to the White House summary. 
• A Nigerian fraud ring stole $10 million. 
• An Indian national submitted 17 fraudulent PPP applications and obtained $8 million. 

All three cases were investigated and prosecuted. 

The domestic fraud totaling an estimated $391 billion produced 371 criminal defendants and $836 million in charged amounts.

The Prosecution Gap

The distance between the estimated $391 billion lost and the $836 million charged is the record’s defining finding. 

The criminal justice response to the largest fraud event in U.S. government program history has, by the numbers in this document, captured less than half a percent of estimated losses in charged form. 

The White House summary does not address recoveries, civil settlements, or ongoing investigations that may not yet have produced charges. 

The subcommittee whose findings produced this data was a Republican-led body, and the White House summary is a politically produced document. 

The underlying agency estimates (from the SBA Inspector General, the DOL Inspector General, and the GAO) are independent watchdog figures that carry their own credibility separate from the political context in which they are being presented. 

The numbers belong to the agencies that produced them, but the framing belongs to the document that assembled them.

ELI5

During COVID, the U.S. government gave out over $5 trillion in relief money. Roughly $391 billion of that is estimated to have been stolen or paid out incorrectly, including $191 billion from unemployment programs and $64 billion from small business loans. 

Foreign hackers and fraud rings took tens of millions. But despite the enormous scale of the theft, only 371 people have been criminally charged, for a combined total of just $836 million.

Source:

U.S. White House