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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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NBC News: President Biden Knew in June He Would Pardon Son Hunter

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NBC News has reported that President Joe Biden’s public declarations about not pardoning his son, Hunter Biden, may have been part of a deliberate strategy to navigate the political and personal fallout of the situation. According to sources close to the matter, the president had been considering a pardon for Hunter as early as June, despite repeatedly and emphatically denying it.

Following Hunter Biden’s conviction on three federal gun charges in June, President Biden faced mounting questions about whether he would use his presidential pardon powers to shield his son from legal consequences. At the time, Biden’s response was clear and direct: “I will not pardon him.”

This stance was reiterated by White House Press Secretary Karine Jean-Pierre, who told reporters as recently as last month that the president’s position had not wavered. “We’ve been asked that question multiple times. Our answer stands, which is ‘no,’” she stated.

However, NBC News now reports that Biden privately discussed the possibility of a pardon with senior aides shortly after Hunter’s conviction. Two sources familiar with the internal conversations revealed that while the president maintained a public stance of non-intervention, the idea of a pardon “remained on the table.”

The report suggests that the public denials were not merely a refusal to answer the question but rather a calculated move. The president and his advisors reportedly decided that maintaining a hardline stance against a pardon was politically advantageous—even if it didn’t reflect the reality of their ongoing deliberations.

For Biden, the decision to publicly reject the idea of a pardon likely served dual purposes. First, it allowed him to distance himself from accusations of favoritism or nepotism at a time when Republicans were increasing scrutiny of his administration’s alleged “two-tier justice system.” Second, it bought time for his team to assess the fallout of such a decision, all while deflecting immediate criticism.

Now, with his term winding down and no re-election campaign to face, Biden has moved forward with the pardon—a choice some critics view as the culmination of a plan to shield his son while minimizing political costs.

The revelation that Biden’s public statements about the pardon were at odds with his private considerations has sparked fresh criticism. Opponents argue that the president’s actions erode public trust, painting him as willing to mislead the American people for personal gain.

“This is a betrayal of the public’s trust,” said one Republican lawmaker. “The president’s words were clear—until they weren’t. This raises questions about what else he may be misleading the country about.”

Supporters, however, argue that Biden’s decision reflects a father’s love and loyalty, underscoring the deeply personal nature of the issue. “This is a man standing by his son during a difficult time,” said one Democratic strategist. “People may not like it, but it’s human.”

With Hunter Biden now pardoned, the president faces the challenge of addressing the broader implications of his decision. For critics, this marks another chapter in what they see as a pattern of political favoritism. For allies, it’s a reminder of the personal challenges leaders face in balancing public duty and family loyalty.

Either way, the revelation that Biden’s public denials were part of a calculated plan is certain to fuel debates about transparency, accountability, and the limits of presidential power in the months to come.

SOURCE: NBC NEWS

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Adam Schiff Urges Senate to Block Kash Patel’s FBI Nomination

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In a fiery call to action, newly appointed California Senator Adam Schiff (D) urged his colleagues in the Senate on Sunday to reject Kash Patel’s nomination for FBI director. This latest salvo in Schiff’s long-standing feud with Patel underscores their deeply entrenched political rivalry, which dates back to explosive revelations about surveillance abuses during the Obama administration.

Patel, a former Trump administration official, first clashed with Schiff in 2017 when he played a key role in exposing alleged misconduct by members of the outgoing Obama administration. Specifically, Patel helped uncover the misuse of intelligence tools to “unmask” the identities of Americans caught on foreign wiretaps—a controversial practice. This revelation led to widespread criticism of the prosecution of Michael Flynn, Trump’s first national security adviser, over debunked allegations of collusion with Russia.

As ranking member of the House Intelligence Committee at the time, Schiff vehemently opposed Patel’s findings. He authored a memo attempting to justify the FBI’s surveillance of Carter Page, a former Trump campaign aide. However, a subsequent Department of Justice Inspector General report discredited Schiff’s defense, validating Republican concerns about FBI overreach in its use of the Foreign Intelligence Surveillance Act (FISA).

Patel’s connection to Trump made him a recurring target during Schiff’s leadership of high-profile investigations. During Trump’s first impeachment inquiry, which Schiff spearheaded, Democrats floated unsubstantiated claims that Patel had acted as a secret “back channel” to Russia. Schiff’s impeachment report even cited phone records between Patel and Trump’s lawyer, Rudy Giuliani, though no evidence of wrongdoing emerged.

Schiff’s pursuit of Patel continued with the January 6 Committee, where he again sought to tie Patel to nefarious activities. The committee ultimately found no wrongdoing, only releasing Patel’s closed-door testimony after considerable delay—a move critics argued was politically motivated.

The Biden administration’s nomination of Patel to lead the FBI has reignited tensions. Schiff contends that Patel’s past criticisms of the media and government officials signal an intent to pursue partisan prosecutions. Patel, however, has consistently maintained that individuals who broke the law in efforts to undermine the Trump presidency—whether in government or media—should face accountability.

For his part, Patel has accused Schiff of abusing his power as a member of Congress, citing Schiff’s role in perpetuating the now-debunked Russia collusion narrative and his mishandling of evidence collected during the January 6 Committee investigation. Patel has also criticized Schiff for violating defendants’ rights by failing to preserve potentially exculpatory evidence.

Schiff’s opposition to Patel coincides with broader scrutiny of the Biden administration. As of Monday morning, Schiff had yet to address President Joe Biden’s controversial pardon of his son, Hunter Biden. Critics argue that Schiff’s refusal to question Hunter Biden’s dealings with Burisma, a Ukrainian energy company, weakens his prior claims that Trump’s request for a Ukraine investigation was baseless.

The Senate faces a pivotal decision on Patel’s nomination, one that could reshape the FBI’s leadership and direction. While Schiff’s opposition reflects ongoing partisan battles, it also underscores broader divisions in Washington over accountability and the rule of law. Whether Patel’s nomination proceeds or stalls, the debate surrounding his candidacy highlights the enduring polarization in American politics.

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President Biden to Issue Pardon for Son Hunter Biden Ahead of Sentencing

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In a surprising turn of events, President Joe Biden has decided to grant a pardon to his son, Hunter Biden, a move expected to be announced Sunday night, according to a senior White House official with direct knowledge of the matter. The decision marks a significant reversal for the president, who has previously stated on multiple occasions that he would not use his executive powers to pardon or commute his son’s sentences.

The pardon will encompass both Hunter Biden’s federal gun charges, for which he was convicted, and his guilty plea on federal tax evasion charges. The gun charge sentencing is scheduled for Dec. 12, with the tax evasion sentencing set for Dec. 16.

Sources within the administration revealed that President Biden made the decision over the weekend after extensive discussions with senior aides. The pardon comes as Biden, 82, nears the end of his presidency with no reelection campaign to consider. Publicly, the president has consistently distanced himself from the idea of granting clemency.

In June, following Hunter Biden’s conviction on three federal gun charges, Biden unequivocally stated, “I will not pardon him,” reiterating his commitment to letting the judicial process play out. First Lady Jill Biden echoed this sentiment during a June interview, emphasizing respect for the judicial system.

Behind Closed Doors

Despite these public assertions, insiders say the possibility of a pardon has been under consideration since Hunter’s June conviction. Two individuals familiar with the internal discussions noted that while Biden publicly denied the idea, the option remained on the table, with close aides advising against making any premature decisions.

White House Press Secretary Karine Jean-Pierre consistently reinforced the president’s stance during press briefings, most recently stating earlier this month that the position remained unchanged.

The pardon decision comes as Republicans continue to accuse the Biden family of corruption and allege preferential treatment by the Justice Department. GOP criticism escalated after a plea deal involving Hunter collapsed in July, leading Attorney General Merrick Garland to appoint U.S. Attorney David Weiss as special counsel in the case.

The move to pardon Hunter Biden has drawn mixed reactions. Critics argue it undermines the justice system, while supporters, including former White House Counsel Neil Eggleston, argue it’s within the president’s constitutional authority. Eggleston told NBC News, “The clemency power has few limitations and certainly would extend to a Hunter Biden pardon.”

The president’s relationship with Hunter Biden, who has struggled with addiction and legal troubles, has been a focal point of political attacks. Biden has often defended his son, describing him as “one of the brightest, most decent men I know.”

While the pardon eliminates the prospect of prison time for Hunter, it undoubtedly reignites political controversy, especially as Republicans scrutinize the Justice Department’s handling of the case.

As the announcement looms, the decision underscores the tension between personal loyalty and public accountability, setting the stage for heated debates in the weeks to come.

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