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More Than $200 Billion in COVID-19 Aid May Have Been Stolen, Federal Watchdog Says

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More than $200 billion may have been stolen from two large COVID-19 relief initiatives:

According to new estimates from a federal watchdog looking into federally funded programs that assisted small businesses survive the worst public health crisis in more than a century, more than $200 billion may have been stolen from two significant COVID-19 relief initiatives.

The figures revealed on Tuesday by the U.S. Small Business Administration inspector general show how much more vulnerable the Paycheck Protection and COVID-19 Economic Injury Disaster Loan programs were to fraudsters than the office’s earlier estimates. This was especially true during the early stages of the coronavirus pandemic.

The inspector general’s report said “at least 17 percent of all COVID-EIDL and PPP funds were disbursed to potentially fraudulent actors.” According to the report, the COVID-19 Economic Injury Disaster Loan Program fraud estimate is more than $136 billion, or 33% of the program’s overall budget. The inspector general estimated that the Paycheck Protection fraud cost $64 billion.

A senior SBA official disputed the new numbers in comments that were included with the report. SBA’s interim associate administrator for capital access, Bailey DeVries, stated that the inspector general’s “approach contains serious flaws that significantly overestimate fraud and unintentionally mislead the public to believe that the work we did together had no significant impact in protecting against fraud.”

The COVID-19 disaster loan program and the Paycheck Protection program both had fraud estimates of $86 billion and $20 billion, respectively, by the SBA inspector general.

According to a June 13 AP report, scammers and swindlers may have stolen about $280 billion in COVID-19 emergency aid, and another $123 billion was lost or misused. The two SBA programs and another to provide unemployment benefits to workers suddenly out of work due to the economic upheaval caused by the pandemic account for the majority of the potential losses. President Joe Biden took over the three projects that were started by the Trump administration. The total loss estimated by AP amounts to 10% of the $4.2 trillion in COVID relief aid that the US government has already paid out.

The amount of potential fraud that the federal government has now disclosed is $276 billion, which is consistent with the AP’s calculations.

During the first nine months of the pandemic, while President Donald Trump was in office, 86% of the fraud—or potential fraud—in the emergency loan programs occurred, according to Gene Sperling, a senior White House official in charge of overseeing pandemic relief spending.

“$200 billion is a very big number, but this, again, should be remembered as potential fraud,” Sperling said. “We think the amount of likely or actual fraud is significantly less, significantly under $100 billion, perhaps around $40 billion.”

But he added, “whichever it is, it’s unacceptably high.”

The SBA inspector general, Hannibal “Mike” Ware, said in a statement Tuesday that the report “utilizes investigative casework, prior (inspector general) reporting, and cutting-edge data analysis to identify multiple fraud schemes used to potentially steal over $200 billion from American taxpayers and exploit programs meant to help those in need.”

Ware, in an interview with The Associated Press earlier this month, said these latest fraud figures won’t be the last ones issued by his office.

“We will continue to assess fraud until we’re finished with the investigations on these things,” Ware said. That could be a long while. His office has a backlog of more than 90,000 actionable leads into pandemic relief fraud, which amounts to nearly a century’s worth of work.

The SBA published a report on its own anti-fraud policies on Tuesday. The report details “the effective measures added to fight fraud and hold bad actors responsible,” according to an email statement from the agency’s administrator, Isabella Casillas Guzman.

SBA previously told The Associated Press the federal government has not developed an accepted system for assessing fraud in federal programs. Previous analyses, the agency said, have pointed to “potential fraud” or “fraud indicators” in a manner that conveys those numbers as a true fraud estimate when they are not. For the COVID-19 Economic Injury Disaster Loan program, the agency said it’s “working estimate” found $28 billion in likely fraud.

According to Larry Turner, inspector general for the Labor Department, fraud in pandemic unemployment assistance programs has reached $76 billion. That is a reasonable guess. According to his testimony, an additional $115 billion was inadvertently distributed to individuals who weren’t eligible for the benefits.

In order to combat widespread fraud, the Biden administration implemented stricter regulations, including the use of a “Do Not Pay” database. Additionally, Biden recently put forth a $1.6 billion plan to increase law enforcement’s capacity to pursue pandemic relief scammers.

Bob Westbrooks, a former executive director of the federal Pandemic Response Accountability Committee, said in an interview the $200 billion number is “unacceptable, unprecedented and unfathomable.” Westbrooks published a book last week, “Left Holding the Bag: A Watchdog’s Account of How Washington Fumbled its COVID Test.”

“The swift distribution of funds and program integrity are not mutually exclusive,” Westbrooks said Tuesday. “The government can walk and chew gum at the same time. They should have put basic fraud controls in place to verify people’s identity and to make sure targeted relief was getting into the right hands.”

According to John Griffin, a finance professor at the University of Texas at Austin’s McCombs School of Business, the fraudulent payouts have consequences.

In a recent paper, Griffin and colleagues claimed that fraud in pandemic relief drove up home prices.

Even after adjusting for other variables that affect home prices such as land supply, prior house price growth, and the ability to telework, the study found that people who fraudulently obtained Paycheck Protection loans were more likely to purchase a home than people who obtained legitimate loans and that housing prices increased by an average of 5.7 percentage points in ZIP codes with high levels of fraud during the pandemic. That would add $22,800 to a house worth $400,000.

Griffin said Tuesday that the study also discovered rises in consumer spending in ZIP codes where people had received significant amounts of fraudulent money, which may have fueled inflation more generally.

“If you paid too much for your house because fraudsters pumped up the house prices in your ZIP code and then your house price ends up going down, you could be the victim of an unintended consequence of fraud,” he said in an interview. “It’s another reason why we should care about fraud.”

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Tim Walz asked Minnesota assassin to kill Senator Klobuchar so he could take seat, FBI letter claims

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In a disturbing twist to last week’s targeted violence against Minnesota officials, sources reveal that a conspiratorial letter left behind by shooting suspect Vance Boelter accuses Governor Tim Walz of orchestrating a political assassination plot. The letter, addressed to the FBI, allegedly claims Walz instructed Boelter to kill U.S. Senator Amy Klobuchar so that Walz could seek her Senate seat—a position he has not expressed any intent to pursue.

Two individuals with direct knowledge of the letter described it as incoherent, one and a half pages long, and filled with paranoid ramblings. The letter allegedly outlines unsubstantiated claims that Boelter was trained “off the books” by the U.S. military, and that Walz had enlisted him to assassinate Klobuchar and potentially other politicians, including a veiled reference to Sen. Tina Smith.

Federal prosecutors say Boelter left the letter in a Buick abandoned near his home in Green Isle, Minnesota. It is believed to include a confession to the killings of Minnesota state Rep. Melissa Hortman and her husband, Mark, as well as the shootings of Sen. John Hoffman and his wife, Yvette.

Boelter, 57, now faces federal charges including:

  • Two counts of stalking Rep. Hortman and Sen. Hoffman using interstate facilities;
  • Two counts of murder in the deaths of the Hortmans;
  • Two counts of firearm use in the shootings of the Hortmans and Hoffmans.

While federal authorities declined to comment on the letter’s contents, local officials addressed the severity of the situation. Hennepin County Attorney’s Office spokesperson Daniel Borgertpoepping stated they could not comment on an open investigation, but added, “We have seen no evidence that the allegations regarding Governor Walz are based in fact.”

Gov. Walz’s spokesman, Teddy Tschann, called the events “deeply disturbing for all Minnesotans” and praised law enforcement and prosecutors for their swift actions.

Sen. Klobuchar issued a strong response, saying, “Boelter is a very dangerous man and I am deeply grateful that law enforcement got him behind bars before he killed other people.”

Documents obtained by the Minnesota Star Tribune also reveal that Boelter held a valid carry license as recently as 2020, issued while he was still affiliated with his family’s private security firm.

With more details likely to surface as the investigation unfolds, the letter marks a chilling insight into Boelter’s delusions—and highlights the growing threats facing public officials.

SOURCE: STAR TRIBUNE

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Tech

ChatGPT use linked to cognitive decline, MIT research finds

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A new study from the MIT Media Lab has raised concerns about the long-term effects of using artificial intelligence tools like ChatGPT on human cognition. The research, released this month, suggests that relying on large language models (LLMs) such as ChatGPT could impair an individual’s critical thinking abilities, especially with prolonged use.

Researchers observed participants over several months as they completed SAT-style essay assignments. The subjects were divided into three groups: one using ChatGPT, another using Google’s search engine, and a third group relying solely on their own thinking—dubbed the “brain-only” group.

To analyze brain activity during the writing tasks, researchers used electroencephalography (EEG) to monitor neural engagement across different regions of the brain. The results showed a stark difference in cognitive involvement among the groups.

According to the study, those using ChatGPT demonstrated the lowest level of brain engagement. Over time, these participants began to rely more heavily on the AI, eventually moving from asking structural questions to simply copying and pasting complete essays. The researchers noted that this group “consistently underperformed at neural, linguistic, and behavioral levels.”

Participants who used Google showed moderate brain activity, while the “brain-only” group displayed the strongest and most widespread neural activity, indicating deeper cognitive involvement throughout the writing process.

The study’s lead author, Nataliya Kosmyna, emphasized the urgency of the findings, particularly as AI tools become more integrated into education.

“What really motivated me to put it out now before waiting for a full peer review is that I am afraid in 6–8 months, there will be some policymaker who decides, ‘let’s do GPT kindergarten.’ I think that would be absolutely bad and detrimental,” Kosmyna told Time

magazine. “Developing brains are at the highest risk.”

The study highlights growing concerns among educators about how easily accessible AI tools are enabling academic dishonesty and changing how students learn. Despite these concerns, AI integration in classrooms appears to be accelerating.

In April, former President Donald Trump signed an executive order promoting the use of AI in American schools. The policy aims to prepare young students for a future economy shaped by AI advancements.

“The basic idea of this executive order is to ensure that we properly train the workforce of the future by ensuring that school children, young Americans, are adequately trained in AI tools, so that they can be competitive in the economy years from now into the future, as AI becomes a bigger and bigger deal,” White House staff secretary Will Scharf said at the time.

As the debate over AI’s role in education continues, this new research may fuel broader discussions on how to balance technological innovation with cognitive development—especially for younger generations.

SOURCE: MIT RESEARCH

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Biden Administration

Kamala Harris Allegedly Covered Up Biden’s Mental Decline, Democratic Source Says

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SACRAMENTO, CA — Former Los Angeles Mayor and current California gubernatorial candidate Antonio Villaraigosa has publicly alleged that Kamala Harris and Xavier Becerra were involved in concealing former President Joe Biden’s mental and physical decline during his time in office.

Villaraigosa, a Democrat, made the claim amid a heated California gubernatorial race. Becerra, the former Secretary of Health and Human Services, is also a candidate, while speculation continues over a potential Harris bid. The race comes as current Governor Gavin Newsom reaches the end of his second and final term, per California’s two-term limit.

In a statement referencing recent reporting and excerpts from the book Original Sin, Villaraigosa stated:

“What I’ve seen in news coverage and excerpts from the new book ‘Original Sin’ is deeply troubling. At the highest levels of our government, those in power were intentionally complicit or told outright lies in a systematic cover up to keep Joe Biden’s mental decline from the public.”

Both Harris and Becerra previously served as California Attorney General. Villaraigosa emphasized their past leadership roles, stating:

“Now, we have come to learn this cover up includes two prominent California politicians who served as California Attorney General – one who is running for Governor and another who is thinking about running for Governor.”

He added:

“Those who were complicit in the cover up should take responsibility for the part they played in this debacle, hold themselves accountable, and apologize to the American people. I call on Kamala Harris and Xavier Becerra to do just that – and make themselves available to voters and the free press because there’s a lot of questions that need to be answered.”

Becerra responded in a statement, saying:

“It’s clear the President was getting older, but he made the mission clear: run the largest health agency in the world, expand care to millions more Americans than ever before, negotiate down the cost of prescription drugs, and pull us out of a world-wide pandemic. And we delivered.”

Kamala Harris has not issued a public response. Fox News Digital reported that it reached out to the offices of Harris and the Bidens but had not received a reply at the time of publication.

The allegations come as discussions about Biden’s cognitive and physical health continue. Earlier this month, during an appearance on The View, Biden dismissed claims of cognitive decline during his presidency.

In related developments, Biden’s personal office recently confirmed that he had been diagnosed with prostate cancer characterized by a high Gleason score and metastasis to the bone.

Villaraigosa’s comments are the latest in a growing list of concerns raised within the Democratic Party about leadership transparency and accountability in the final years of the Biden administration.

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