Prosecutions for Paycheck Protection Program fraud are expected to increase even as the coronavirus pandemic itself begins to wane, a top Justice Department official told senators on Tuesday.
“I think we are just getting started. For the foreseeable future, we will be bringing these cases,” William Hughes, associate deputy attorney general, said in testimony before the Senate Judiciary Committee.
The $600 billion Paycheck Protection Program (PPP) launched in April to aid small businesses negatively affected by the coronavirus pandemic.
Since its formation, the Justice Department has brought six cases against individuals accused of defrauding the programs. In all six of the cases, individuals sought thousands even millions of dollars by claiming phony businesses and employees.
Sen. Richard J. Durbin, Illinois Democrat, said the number of cases filed by the Justice Department seems minuscule compared to the size of loans or the number of applications.
“This exploitation that is spelled out in your testimony of six is almost laughable,” Mr. Durbin said. “These are not thoughtful conniving individuals. They are just silly efforts to exploit the government in the belief that its an easy thing to do. To invent companies, invent payrolls, that seems fairly traceable.”
Mr. Durbin urged the Justice Department to bring more cases and do it more publicly to discourage PPP fraud.
The statute of limitations for PPP fraud runs between five and 10 years so the Justice Department can bring cases even after the program ends, Mr. Hughes said.
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