COVID Relief Money Stolen From United States Government

Over $1 trillion was set aside by the U.S. government to help individuals, families and businesses who were struggling with the financial consequences of COVID-19. Somehow, at least $100 billion of that went missing along the way. This estimate was provided by the Secret Service, while the FTC contends that there have been over 400,000 scams related to the disease caused by the coronavirus pandemic. Now, people want answers about how this money could possibly have vanished into the ether.

Secret Service pandemic fraud recovery coordinator Roy Dotson said that “the sheer size of the pot is enticing to the criminals.”

Much of the lost money was stolen through scams related to unemployment. According to the Labor Department, around $87 billion in benefits might have gone to people who weren’t meant to receive them. The Secret Service has reclaimed around $1.2 billion and returned around $2.3 billion — but that doesn’t come close to fixing the problem. There are hundreds of active investigations related to the thefts. More than a hundred suspects have been arrested.

Lee Price III was charged with wire fraud and money laundering, and eventually pleaded guilty to both crimes. This was after he managed to steal over $1.6 million from the aforementioned “pot.” He tried for another million, but that’s when he got caught.

Dotson added, “Can we stop fraud? Will we? No, but I think we can definitely prosecute those that need to be prosecuted and we can do our best to recover as much fraudulent pandemic funds that we can.”

Courtney Hilaire, a 29-year-old man from Rhode Island, planned to file fake applications for COVID unemployment in eight states — and maybe more. He eventually pleaded guilty to wire fraud, identity theft, conspiracy to possess unauthorized access devices, and possession of the equipment used to make those devices. Hilaire admitted that there were others involved in the scheme. He will be sentenced on March 30, 2022.

SSDI Wait Period Threatened By COVID

To put in perspective exactly how bad this is: people die waiting to see if they qualify for disability, usually from the very disability that forced them to apply in the first place. And it’s notoriously difficult to get approved for Social Security Disability Insurance (SSDI) in the first place.

SSDI hearings have experienced a whopping 591-day delay on average, or a 40 percent increase from 2010 to 2018. This is a harsh reality: SSDI is a government benefit provided with very little actual government support. There aren’t enough workers to investigate and properly file claims. There aren’t enough judges to promptly clear the docket of new cases. COVID-19 didn’t help at all.

For those who say, “Good. It should be hard to get on disability,” we have a rebuttal: “Why?” Why should it be this difficult for people who have physical or mental incapacities to get the payments they need to survive? How many people need to have their financial security ruined by the unforeseeable circumstances of life before we accept that it’s a worthwhile system to implement? 

And don’t forget, these people receive all the backpay that accrues from the moment they apply until the moment the application is accepted. The system would be more stable with smaller payments, and that means accepting applications as they arrive.

For a year now, COVID-19 has strained the system to it’s breaking point.

Thankfully, the recent passage of another round of economic relief will help SSDI applicants get their heads above water for another month or two.

The IRS said, “Because these payments are automatic for most eligible people, contacting either financial institutions or the IRS on payment timing will not speed up their arrival.”

A spokesperson added, “For those who received EIP1 or EIP2 but don’t receive a payment via direct deposit, they will generally receive a check or, in some instances, a prepaid debit card (referred to as an “EIP Card). A payment will not be added to an existing EIP card mailed for the first or second round of stimulus payments.”

In general, SSDI has experienced yet another slowdown. Disabled U.S. citizen Antonio Evans said, “I had a slip and fall where I damaged my spine. At 4,5 and 6 in my neck. I had to recover from being paralyzed from the neck down.”

His application for SSDI was filed in 2019 — but nearly two years later, it still hasn’t been accepted or denied.

Non-profit clinic manager Tom Yates helps low-income individuals navigate the SSDI application, hoping to make it a little faster for them. Yates said, “It’s a hard system to navigate. It’s like, I don’t try to do my income taxes myself. It’s a complicated system. And I would say that Social Security and SSI disability is similar. The rules are incredibly complex.”

He added, “[Applicants are] having trouble getting medical records or sending people out for medical exams when they can do that. So the whole process has really kind of slowed down because of the pandemic. It’s, I wouldn’t say collapsed, but for some people, it’s probably the same effect, just nothing is moving like it should be.”

What Is The Federal Crime Insurance Program And Does It Still Exist?

The Federal Crime Insurance Program was a program that was created in 1970 by Title VI of the Housing and Urban Development Act, commonly known as HUD. This program was created in order to allow home and business owners the ability to purchase insurance for damages from crimes such as burglary, theft, robbery, and other similar crimes.

The reason for its’ creation was that in certain states with high crime rates, private crime insurance policies were either not available, or were so expensive that most people and businesses were unable to afford them.

The big problem was that most homeowners’ and business insurance packages offered no protection for assets that were taken, or damages inflicted to property, that occurred as the result of a crime. This left many businesses and homeowners’ unable to have any way of recovery after they became the victims of these types of crimes.

Does The Program Still Exist?

The Federal Crime Insurance Program was terminated on September 30, 1982 because it was costing the federal government millions of dollars in insurance losses. From September 30, 1980 to September 30, 1981, the program cost the government $33.7 million dollars.

As you can imagine, this was a program that was simply unfeasible to be maintained as it was resulting in far too high of a cost, and many individual states had begun offering programs and incentives that helped to protect homeowners’ and businesses from damages resulting from crimes.

The main states that were still benefiting from The Federal Crime Insurance Program at the time of its’ closure were New York, Pennsylvania, and Florida who made up 71% of the total policies issued at the time.

For businesses and homeowners’ who wanted to participate in the program, the last day to apply for it was September 30, 1982.