U.S.
Apr. 21—Seek and ye shall find, especially if what's being sought is evidence of even more fraud by state public employees collecting millions of dollars from the federal government coronavirus financial aid program.
The Illinois Office of Inspector General recently disclosed that its investigators have found more financial wrongdoing involving the Paycheck Protection Program. To date, investigators estimate losses to taxpayers of $7.2 million.
Most stunning is that 175 employees of the Illinois Department of Human Services were implicated in the fraud schemes.
Employees of other departments, including Corrections, Children and Family Services and Healthcare and Family Services, also were implicated.
Last year, the OEIG revealed it had completed 204 investigations, finding wrongdoing by public employees in 177 cases. Two weeks ago, it disclosed that it has concluded 325 PPP cases, finding wrongdoing in 275 cases.
The inspector general said it has "consistently recommended discharge of employees who have been found to have engaged in the misconduct."
"Discharges have been sought by agencies and upheld after further adjudications in venues such as the Civil Service Commission," it said.
The revelations from Illinois are just the tip of a 50-state iceberg as it relates to PPP fraud. Federal officials have estimated that nearly 20 percent of the more than $1 trillion available under PPP has been lost to fraud.
Ironically, the OEIG included an obvious warning in its report about the program, one that was ignored on a grand scale.
It said that, "regardless of the ease of procuring these PPP funds, this was not free money for the taking."
That's not how it was viewed by fraudsters, who saw the federal aid as manna from heaven and raced to take advantage. In some cases, individuals established themselves as brokers, helping others prepare fraudulent applications and taking a kickback as a fee.
The PPP loans were intended to provide financial relief for small businesses whose operations were threatened by economic lockdowns related to the coronavirus pandemic.
Although characterized as loans, they were essentially grants, because the loans were readily forgiven.
Because of the massive fraud, investigators are examining only those cases involving loans of $20,000 or more.
OEIG said, "in order to be eligible for a PPP loan of that size, a business typically needed to generate approximately $100,000 or more of annual net profit or gross income — earned outside of the employee's full-time state employment."