Over US$200 billion (about RM934 billion) from the US government's Covid-19 relief programmes were potentially stolen, a federal watchdog said on Tuesday, adding that the US Small Business Administration (SBA) had weakened its controls in a rush to disburse the funds.
At least 17% of all funds related to the government's coronavirus Economic Injury Disaster Loan (EIDL) and Paycheck Protection Program (PPP) schemes were disbursed to potentially fraudulent actors, according to a report released Tuesday by the SBA's office of inspector general.
Over the course of the pandemic, the SBA disbursed about US$1.2 trillion of EIDL and PPP funds.
The SBA disputed the more than US$200 billion figure put forward by the watchdog and said the inspector-general's approach had significantly overestimated fraud.
The agency said its experts put the potential fraud estimate at US$36 billion and added that over 86% of that likely fraud took place in 2020, when the administration for former president Donald Trump was in office. President Joe Biden took office in January 2021.
The fraud estimate put forward by the inspector general for the EIDL programme stood at more than US$136 billion while the PPP fraud estimate was US$64 billion.
The US is probing many fraud cases pegged to US government assistance programmes. In May 2021, Attorney-General Merrick Garland launched a Covid-19 Fraud Enforcement Task Force.
Last year, the US Justice Department tapped federal prosecutor Kevin Chambers to lead its efforts to investigate alleged fraud schemes intending to bilk government pandemic assistance programmes.
In September 2022, the inspector-general for the US Labor Department said fraudsters likely stole US$45.6 billion from the US' unemployment insurance programme during the coronavirus outbreak by applying tactics like using Social Security numbers of deceased individuals.
Also in September, federal prosecutors charged dozens of defendants, who were accused of stealing US$250 million from a government aid programme that was supposed to feed children in need during the pandemic.
Earlier this year, a separate watchdog report said the US government likely awarded about US$5.4 billion in Covid-19 aid to people with questionable Social Security numbers.