Illinois government agencies face a serious scandal after the state’s Executive Inspector General implicated 373 state and local government employees in Paycheck Protection Program (PPP) fraud. The investigation began in 2022 and covered 501 cases alleging misuse of federal pandemic relief funds.
Investigators found that many employees falsely claimed to run side businesses, submitted inflated income information, or obtained loans through brokers in exchange for kickbacks. At least $1.19 million in questionable PPP loans were tied to just 54 of the cases closed in the year ending June 30.
Several reported cases revealed egregious misuse: a PACE bus driver admitted using $20,000 in PPP funds to renovate her home, and others bought vehicles or other personal items with proceeds. About half the implicated workers paid third parties thousands of dollars to file fraudulent applications on their behalf.
Primary targets included employees at the Illinois Department of Human Services (IDHS), which accounted for over 60% of the misconduct—43 were fired and 53 resigned prior to action. Other agencies involved included the Department of Corrections, the Department of Children and Family Services, CTA, and PACE.
Despite the large number of implicated individuals, criminal charges remain limited. Only a fraction of those implicated face prosecution, including a few high-profile cases referred by the Attorney General’s Public Integrity Bureau.
Illinois Attorney General Kwame Raoul emphasized that abuse of pandemic relief funds by government personnel is particularly egregious, violating the public trust. He pledged continued prosecution of public employees involved.
