WASHINGTON – The House Oversight Committee held its first hearing of the new Congress on Wednesday and its chairman, James Comer (D-Ky.), immediately blasted Democrats for their “lack of oversight accountability” with regard to multitrillion-dollar relief bills passed during the pandemic.
“With massive government spending comes opportunity for waste, fraud and abuse,” Comer said. “This committee has for far too long stood on the sidelines while taxpayer dollars are wasted by bureaucrats whose only priority is getting money out the door.”
Congress has authorized over roughly $6 trillion on pandemic response-related programs, including the Coronavirus Aid, Relief, and Economic Securities Act, which established the well-known Paycheck Protection Program (PPP). The Small Business Administration delivered over $800 billion in PPP loans, but audits have found significant instances of fraud.
About $5.4 billion in “potentially fraudulent” pandemic loans were dispensed to over 69,000 applicants with “questionable” Social Security numbers, a report by the non-partisan Pandemic Response Accountability Committee (PRAC) revealed Monday. Additionally, over 1 million coronavirus stimulus payments went to dead people, the Government Accountability Office (GAO) reported in June 2020.
The head of the GAO, Gene Dodora, testified that several key reasons for problems happened during the execution of the payments. He said the expedited nature of the stimulus program allowed businesses to apply for loans through self-certification and with little supporting documentation.
“These trade-offs, along with internal control weaknesses within the agencies, made these programs much more susceptible to fraud,” Dodora said.
Most of the applications and disbursement happened in 2020 during the Trump administration.
PRAC Chair Michael Horowitz also testified, noting that the Treasury’s Do Not Pay list, which identifies potentially suspicious recipients for a secondary screening, was bypassed for pandemic payments.
“The problem there was the desire to get them out as simply as possible, without taking an appropriate amount of time to make sure they were sending money to the right people,” Horowitz said.
Democrats on the committee tried to deflect blame, citing systemic issues with the federal and state agencies tasked with overseeing stimulus checks and unemployment insurance.
“States unemployment agencies have long had problems getting help to people who need it,” Rep. Katie Porter (D-Calif.) said, referencing a report that shows the unemployment insurance overpayment rate has been more than 10% for 15 of the last 19 years.
“Due to chronic underinvestment in technology and systems, we saw the same problems of waste, fraud and abuse that we’ve seen for decades under Democratic and Republican presidents, in red and blue states,” Porter said.
Democrats also attacked Comer for bringing partisan politics to the committee room. In addition to pandemic spending, Comer has pledged to investigate a number of hot-button issues, including the border crisis, classified documents, and the Biden family.
“[Republicans] will attempt to absolve themselves of many of the decisions they’ve made over the last few years in order to fit their own political narrative,” Rep. Jimmy Gomez (D-Calif.) said at Wednesday’s hearing. “This isn’t about oversight. It’s about passing the buck and making one too.”