Secret Service recovers millions in Covid relief funds from fraudulent accounts that used stolen information
A word of caution to the online banker
Economic Injury Disaster Loans were meant to keep small businesses afloat after crippling financial issues during the pandemic, but by applying for EIDLs, some fraudulent accounts received governmental loans without much gatekeeping, as reported by NBC News.
Friday morning, the Secret Service — which teamed up with the Small Business Administration — announced the recovery of $286 million in COVID-19 relief funds.
Green Dot Bank — a “branchless,” online financial institution — was used to disperse the fraudulent relief money through debit cards. The bank worked with authorities to uncover 15,325 suspicious accounts and recover millions.
The Small Business Administration will receive the recovered funds.
In the investigation, it was found that the majority of the accounts were created using either fully fictitious identities or partially fictitious identities that included stolen information, said Assistant Special Agent in Charge Roy Dotson.
“Modern-day conveniences and advances — which we all use — like online banking, third-party payment systems and cryptocurrencies have afforded fraudsters to expedite their criminal activities,” said Dotson.
It is also suspected that there are “many perpetrators” inside and outside of the United States.
Two years have passed since the Secret Service’s investigation began in April 2020, and Dodson says it will take much more time to recover all of the lost and fraudulent funding.
In 2020, the Secret Service estimated that fraudsters had robbed more than a total of $100 billion dollars of COVID-19 relief funds.
To date, the Secret Service reports that only $1.4 billion of these funds have been recovered.