In the rush to provide aid to the rapidly growing mass of unemployed Americans, federal and state authorities apparently didn’t bother to set up adequate anti-fraud protection.
Around 50% of all the funds that the US government allocated for unemployment benefits during the pandemic have been stolen by fraudsters, Axios reported, citing an analysis by several fraud experts. As much as $400 billion might have been stolen over the last year, the CEO of the anti-fraud service ID.me, Blake Hall, stated in an interview with the media outlet.
According to Axios, scammers usually obtain the money by impersonating real people whose identities have either been stolen or provided by defrauded citizens voluntarily. After the fraudsters receive the money from the authorities, they use an army of “mules”, small-time criminals, to withdraw the cash via ATMs and then send it elsewhere. The media outlet noted that criminals may have used cryptocurrencies in order to transfer illicitly gained money so that it can’t be traced.
Foreign Criminal Syndicates are to Blame
There have been several high-profile cases of Americans defrauding the governments for COVID relief money over the past year. Two Florida residents pleaded guilty in March 2021 to filing fraudulent loan applications for more than $1.1 million, pretending to be pandemic-struck farmers. Prior to that, in February of the same year, Miami man David T. Hines also had to plead guilty to filing false…