Stopping COVID-Related Benefits Fraud
The Coronavirus Aid, Relief, and Economic Security Act — commonly known as the CARES Act — provided trillions of dollars to Americans who were hit hard financially by the pandemic. Fraudsters quickly tried to get their hands on some of that money, which is why the federal Pandemic Response Accountability Committee (PRAC) was established. PRAC works with multiple partners, including the USPS OIG when Postal Service employees may be involved, to safeguard CARES funds by identifying and investigating instances of possible fraud.
In one case, for instance, we received information about four USPS employees in California involved with suspicious money orders. Working jointly with the Department of Labor Office of Inspector General, IRS Criminal Investigation, and the state’s Employment Development Department (EDD), OIG special agents determined the employees were fraudulently obtaining unemployment benefits provided by the CARES Act. Having made false claims of COVID-related job losses, they used the unemployment benefits to buy and cash tens of thousands of dollars’ worth of postal money orders. They also fraudulently obtained EDD-issued debit cards in other peoples’ names and used them to withdraw cash from ATMs.
Sometimes they deposited the cash in their own personal bank accounts. In a 16-day period, one employee put $27,000 into his own account, while another dropped $10,000 into his. Ultimately, all four employees were able to fraudulently obtain nearly $200,000 in COVID-related benefits.
All four were fired from the Postal Service. Two of the cases were handled administratively, while two others resulted in federal criminal charges. The two former employees who were charged pleaded guilty, and both received three years of probation followed by one year of home detention. Both were also ordered to pay a combined restitution of almost $185,000.
The OIG takes fraud very seriously, especially pandemic relief fraud, which hurts the people who need these benefits the most. We will continue to vigorously pursue cases involving USPS employees. If you’re aware of any instances, please let us know via our Hotline.
For further reading:
- Department of Justice (via uspsoig.gov), "Former Mail Carrier and Co-Schemer Who Lived on His Mail Delivery Route Each Sentenced to Nearly 3½ Years in Prison for COVID Fraud"