Lawmakers on both sides of the aisle were frustrated in their attempts Tuesday to learn specifically how a potential fourth phase of coronavirus relief could be protected from fraud.
At Tuesday’s Senate Judiciary Committee hearing, Chairman Lindsey Graham, a Republican, and Ranking Member Dianne Feinstein, a Democrat, both appeared unsatisfied with Justice Department and law enforcement officials who said it was too soon to discuss specific details of their ongoing investigations.
At one point, Feinstein wanted to know how much was lost and recovered by Washington State following reports that a Nigerian fraud ring used identity theft to collect unemployment payouts.
U.S. Secret Service Assistant Director Michael D’Ambrosio confirmed the agency issued an alert to financial institutions which he said helped stop the loss of an additional $500 million in wrongful payouts, but added, "I have no specific information to confirm those particular activities."
"I’ve been here for a while and, Mr. Chairman, I’ve never seen anything like it," Feinstein said. "It's a program riddled with fraud."
DOJ, DHS and FBI officials told senators that accused fraudsters have targeted the Paycheck Protection Program, which provides government-backed loans and funds to small businesses impacted by COVID-19. Those seeking to steal from the program could misrepresent the size of the business or fabricate its existence entirely.
"If you put $3 trillion out there, people will take advantage of it," Graham said. "And we had to do it."
"And I share your frustration," Graham told Feinstein. "There’s been a lot of generalities here. We'd like to know what we can do. What's going? Who's doing it?"
While the full scope of COVID-19 fraud aimed at the government wasn’t made clear Tuesday, customs officials have made a variety of arrests and seizures in an attempt to stop illegal marketing and shipping of fake coronavirus treatments and test kits.
More than 67,000 consumer complaints involving coronavirus related fraud and identity theft were filed with the Federal Trade Commission, totaling upward of $48 million in reported losses, according to FTC data released this week.
Agents with ICE Homeland Security Investigations have ramped up enforcement efforts in recent weeks with a focus on websites marketing and selling coronavirus products. A woman in Georgia recently pleaded guilty after she was charged with importing and selling an unregistered pesticide on Ebay, claiming it could protect against coronavirus.
ICE special agents have arrested 21 people on allegations related to coronavirus fraud or the shipping of unauthorized tests and treatments, according to the agency.
U.S. Attorney Craig Carpenito, who heads the Justice Department’s hoarding and price gouging task force, said Tuesday his team has opened hundreds of investigations with thousands of findings from various federal law enforcement agencies. But questions persisted about ongoing fraudulent activity and the potential for more.
"I know it can be frustrating at times that we can't get into specifics," Carpenito said. "But one of the reasons we can’t is our -- you know -- our network operates through the ability to stay covert and find these resources with this money before we pounce when we go into court and go public. We have to have everything locked down if we're going to be successful."