The SBA’s Paycheck Protection Program was particularly susceptible to fraud because banks were urged to quickly get money out to prevent the pandemic from causing an economic crisis.
Justice Department is throwing more resources into identifying and prosecuting these fraudsters, with the Secret Service estimating that more than $100 billion has been stolen from a range of programs under the Coronavirus Aid Relief and Economic Security Act. When Congress authorized as much as $669 billion in forgivable pandemic loans from the Small Business Administration two years ago, a large chunk of that money disappeared into the hands of bad actors who claimed to run businesses in need of funds.
“Sites like this are designed to create documents that evade automated fraud detection tools, and even human underwriters,” said Jesse Carlson, general counsel of commercial-finance lender Kapitus, and a former counsel in the professional liability and financial crimes section of the Federal Deposit Insurance Corp.
