Today, House Budget Committee Republican Leader Jason Smith (MO-08), along with House Judiciary Committee Republican Leader Jim Jordan (OH-04), House Small Business Committee Republican Leader Blaine Luetkemeyer (MO-03), and House Ways and Means Committee Republican Leader Kevin Brady (TX-08) demanded answers from the Biden Administration about its non-existent effort to pursue hundreds of billions worth of federal tax dollars in pandemic fraud. In a letter sent to President Biden’s Attorney General, Merrick Garland, Smith, Jordan, Luetkemeyer, and Brady point out that President Biden’s $2 trillion American Rescue Plan, which economists have concluded helped spark the current inflation crisis, was made vulnerable to criminal activities and theft when Democrats rejected Republican efforts to include measures that would have strengthened fraud prevention. The Republican members go on to question why the Biden Administration has failed to provide Congress any updates regarding the appointment of a “Chief Pandemic Prosecutor” or his efforts thus far to prosecute widespread fraud.

“The Biden Administration and Congressional Democrats were quick to enact their $1.9 trillion spending bill, the ‘American Rescue Plan Act,’ but rejected Republican efforts to include fraud prevention measures before money went out the door. In the past year, as prices have continued to spike, we have seen a growing number of examples of COVID-19 spending and government benefits going toward any number of projects unrelated to the pandemic – from golf courses in Florida to a ski mountain in Iowa, and yet the White House remains silent about the negative consequences of their inflationary spending agenda. The American people are now finding out what exactly they got for $2 trillion: help wanted signs, higher prices and the theft of hundreds of billions more with no plans from this White House for accountability or retribution,” said House Budget Committee Republican Leader Smith.

“Hardworking American families are struggling with five-dollar gas, record high inflation, and a baby formula shortage,” House Judiciary Committee Republican Leader Jordan said.  “Meanwhile, nearly $100 billion has been stolen from taxpayer funds passed as part of Joe Biden’s so-called ‘American Rescue Plan.’ Reckless Democrat-passed spending has caused the failing Biden economy, and now Democrats continue to stonewall common-sense good-government proposals from Republicans, like strengthening identity verification to prevent waste, fraud, and abuse of taxpayer resources.”

“Under President Biden and his Democrat allies in Congress, American taxpayers have witnessed their hard-earned tax dollars go out the door to fraudulent actors. The Biden Administration has overseen a mismanaged anti-fraud apparatus, resulting in approximately $100 billion in tax dollars getting diverted from those in need. Main Street USA continues to shoulder Biden’s burdensome and reckless ‘American Rescue Plan Act’ through skyrocketing costs from the gas pump to the grocery store. Despite their economic failure and the inability to address widespread fraud, Biden and Congressional Democrats have ignored the crisis impacting American families through a serious lack of action. It is time to receive legitimate answers from this administration and make room for real accountability for their failure to our small businesses and the American taxpayer,” said House Small Business Committee Republican Leader Luetkemeyer.

“The greatest theft of taxpayer dollars in our lifetime has fueled the inflation crisis, obstructed legitimate payments to unemployed workers, and turned thousands of Americans into unwitting identity theft victims. Fraud committed by organized cybercrime and international crime rings could represent half of all the COVID unemployment aid, more than the entire 2021 budgets of the Army and Navy combined. Unfortunately, Democrats in Washington have ignored this problem and refused to hold even a single oversight hearing,” said House Ways and Means Committee Republican Leader Brady.

The four House Committee lead Republicans note that it has been over two months since President Biden announced this new Presidential appointment in his State of the Union address to Congress, but since then, Congress has not received any further details about the work underway. Among the questions asked by the Republican leaders:

  • “The Congressional Budget Office projects billions of dollars of outlays from the American Rescue Plan through at least fiscal year 2031. Will this Director position become a permanent position at DOJ to continue to uncover the full extent of fraudulent activities?
  • “There is a dichotomy between official figures from federal departments and agencies that have been reported to Congress and outside estimates of the amount of COVID-spending fraud. When will Mr. Chambers update Congress with a breakdown of the resulting fraud from enactment of the American Rescue Plan over the past year?
  • “The March 10, 2022, DOJ announcement explained that Mr. Chambers ‘plans to focus on large-scale criminal enterprises and foreign actors who sought to profit at the expense of the American people.’ Does this statement mean that he will not focus efforts on fraudulent activities associated with unemployment insurance, the Paycheck Protection Program, the Economic Injury Disaster Loan Program, and other SBA programs?”

Smith, Jordan, Luetkemeyer, and Brady requested a written response or briefing on their inquiry by June 10, 2022.

Read the full letter here.

Background:

  • When the Biden Administration came into office in January 2021, there was over one trillion taxpayer dollars in unspent, previously appropriated COVID-19 funds still available.
  • Despite bipartisan calls to first prioritize these dollars, the Biden Administration enacted the $1.9 trillion American Rescue Plan Act less than two months later.
  • While jamming through Biden’s signature “Covid relief” bill, Democrats refused to adopt common-sense proposals from Republicans that would strengthen identity verification and fraud prevention measures.
  • The Department of Labor estimates that $163 billion of pandemic spending have been lost to fraud, with some outside estimates putting that number as high as $400 billion.
  • Congressional Democrats have refused to hold hearings on wasteful, misused, and fraudulent pandemic spending, despite repeated requests from Republicans.
  • House Budget Committee Republican Leader Smith has sent oversight letters to Biden Administration officials including “Rescue Czar” Gene Sperling, regarding the implementation of pandemic spending and numerous examples of billions of waste, fraud, and abuse.
  • As a result of approximately 20 percent of the Economic Injury Disaster Loan Program having been flagged for potentially fraudulent activity by the Small Business Administration’s Inspector General, House Small Business Republican Leader Luetkemeyer has sent repeated letters inquiring whether the SBA has the necessary oversight capabilities in place to prevent criminal activity. 

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