The money might have gone to an international criminal organization.
QUICK FACTS:
- The Small Business Administration reportedly gave 1.3 billion in COVID-19 disaster relief funds to applicants with foreign IP addresses.
- Reports of the investigation noted the possibility an international criminal organization was involved in the fraud, according to the Inspector General’s report.
- The agency knew there were international requests for the money and blocked over 100,000 applications from six countries deemed to be “high risk.”
- More than 33,000 applications were submitted from Nigeria and 241 were approved, which gave applicants in the African nation nearly $20 million.
OFFICIAL STATEMENTS:
- “The numerous applications submitted from foreign IP addresses are an indication of potential fraud that may involve international criminal organizations,” the government watchdog group said in its report.
- A spokesperson for the Small Business Association told reporters that the agency has “successfully stopped most of the applications from foreign IP addresses and is committed to ensuring that effective fraud controls are in place for future programs.”
BACKGROUND:
- The approval rate of applications in Nigeria was said to be below 1%, while applicants in other countries such as Mexico (21%), Canada (18%), and India (16%) had a much higher success rate.
- The White House estimated in February of this year that roughly $80 billion of relief funding went to pandemic unemployment fraud.
