(WASHINGTON) — Twice in 24 hours President Joe Biden misspoke when discussing the Russian invasion of Ukraine, referring to it instead as the war “in Iraq.”
The first apparent gaffe occurred Tuesday when Biden was courting Democratic donors at a fundraiser in Chevy Chase, Maryland.
“Think about this: If anybody told you — and my staff wasn’t so sure, either — that we’d be able to bring all of Europe together in the onslaught on Iraq and get NATO to be completely united, I think they would have told you it’s not likely,” Biden said. “The one thing Putin counted on was being able to split NATO.”
The second mistake happened Wednesday as Biden departed Washington for Chicago, where he delivered a major speech on his economic philosophy. On the South Lawn, Biden was asked about whether Russia’s Vladimir Putin is weakened after a short-lived mutiny by Wagner Group leader Yevgeny Prigozhin.
The rebellion, in which Prigozhin’s armed forces marched toward Moscow, represented the most significant risk to Putin’s authority in his decades in power.
“It’s hard to tell, but [Putin’s] clearly losing the war in Iraq, losing the war at home. And he has become a bit of a pariah around the world,” Biden told reporters.
The White House has not addressed Biden’s slips.
Biden’s long been prone to such gaffes verbal blunders, even predating his presidency.
Biden’s critics and Republicans have often seized on the miscues as an opening to criticize his age and question his fitness for office.
At 80, Biden is the oldest sitting president in history and would be 82 if reelected and sworn in for a second term. Former President Donald Trump, the early Republican front-runner, just turned 77 and would be 79 at the time of his swearing-in were he to win the general election.
As he’s faced scrutiny about his health and age after announcing his reelection campaign, Biden’s often responded with a common refrain: “Watch me.”
Biden previously told ABC News he took a “hard look” at his age himself when weighing whether to run for reelection and respects Americans doing the same.
“I took a hard look at it before I decided to run, and I feel good,” Biden told ABC News Chief White House Correspondent Mary Bruce in April. “I feel excited about the prospects, and I think we’re on the verge of really turning the corner in a way we haven’t in a long time.”
(ALLEN, Texas) — As a Texas grand jury declined to indict the police officer who killed a mass shooter at an outlet mall in May, authorities released dramatic body camera video Wednesday of the officer racing toward the gunfire and taking down the assailant accused of shooting 15 people, eight fatally.
“This video shows how quickly a routine interaction with the public turned into a life-and-death situation,” Allen, Texas, Police Chief Brian Harvey said in a statement Wednesday. “The officer recognized the danger, ran toward the gunfire and neutralized the threat — and for his actions, the Allen community is forever grateful.”
The mass shooting unfolded on May 6 at the Allen Premium Outlets, north of Dallas, Texas.
The suspect was identified as 33-year-old Mauricio Garcia, according to law enforcement officials. Police said Garcia was armed with an AR-15 rifle.
Garcia, 33, was fatally shot by a police officer who rushed to the gunfire and confronted him, police said.
Among those killed in the rampage were two sisters, ages 8 and 11, and a 3-year-old boy and his parents.
The suspect left a trail of social media activity indicating he may have scouted the location weeks prior to the deadly shooting, according to police. A profile appearing to belong to Garcia also contained numerous references to Nazi ideology, hatred of women, racism and antisemitism, ABC News previously reported.
The body camera video released Wednesday by the Allen Police Department, warned the footage is “disturbing and recommend a high level of discretion when viewing.”
The video begins by showing the officer, whose name has not been released, speaking to a mother and her two children, telling the boys, “Make sure you wear your seatbelts when mommy’s driving.” Suddenly, multiple gunshots erupted in the distance, according to the video.
The officer radioed in he was hearing gunfire at the outlet mall, the video shows. The officer then immediately went to his police cruiser, grabbed a rifle and began running in the direction of the gunfire, yelling into his radio, “I’m on foot. I need everybody I got,” the video shows.
“I’m moving as fast as I can to try to get over there,” the officer is heard saying in the video.
As the shooting continued, the officer radioed in, “I’m at Tommy Hilfiger. I don’t know where he’s at.”
Moments later, the officer spots the gunman firing his weapon, according to the video. The officer returned fire from a distance, striking and killing the gunman.
“Shots fired by police. I’ve got him down,” the officer radioed in before moving toward the gunman, yelling, “Drop the gun,” according to the video.
Prosecutors from the Collin County District Attorney’s Office and the Texas Rangers presented evidence to a grand jury on Monday, and after reviewing the facts, the panel returned a “no bill” decision on Tuesday, declining to indict the officer on any charges.
The Allen Police Department released a statement, saying it “appreciates the hard work of the grand jury, Texas Rangers and the District Attorney’s Office by ensuring a process that helps promote accountability, community involvement and transparency.”
The police department said it has also requested a “comprehensive and independent” review of the incident by the International Association of Chiefs of Police.
“The resulting after-action report will offer insight and best practices to support future training and emergency response provided by Allen Police,” the statement said.
(DELPHIA, Ind.) — Delphi, Indiana, double murder suspect Richard Allen allegedly confessed to the killings several times in a jail phone call with his wife in April, according to newly unsealed court documents.
Allen, a Delphi resident, was arrested in October 2022 and charged with two counts of murder for the deaths of Abby Williams, 13, and Libby German, 14. The best friends were enjoying a day off from school when they were killed on a Delphi hiking trail in February 2017.
While in custody, on April 3, Allen was on a call with his wife and allegedly admitted “several times that he killed Abby and Libby,” according to a court document released on Wednesday.
His wife ended the call abruptly, the document said.
The document was filed April 20 by the prosecutor requesting to obtain Allen’s mental health records during his time as an inmate, as well as video and logs that recorded his behavior to refute defense claims regarding the Westville Correctional Facility.
“Soon after” that call with his wife, Allen’s attorneys filed an emergency motion saying his mental state had declined and he should be moved, alleging Westville Correctional Facility was unfit, the document said.
Allen was refusing to eat, refusing to sleep and “was wetting down paperwork he had gotten from his attorneys and eating it,” the document said.
Allen broke the tablet he used for phone calls, the document said, and went from making two phone calls a day to making no calls.
Defense attorneys did not immediately respond to ABC News’ request for comment on Wednesday. But at a June 15 court hearing, defense attorneys said any confessions made by Allen are unreliable due to his deteriorating mental and physical health.
On April 14, Allen was evaluated by two psychiatrists and a psychologist to see if he needed involuntary medication or to be moved to a different unit, the document said, and they determined Allen didn’t need involuntary medication and didn’t need to be moved. After that meeting, Allen started eating and sleeping again and his behavior “began to return to what it was prior to making the admission on April 3,” the document said.
Allen has pleaded not guilty to the two murders. According to court documents, Allen admitted to police to being on the trail that day but denied any involvement in the girls’ murders.
Allen’s trial has been scheduled for January 2024.
In a document filed by the prosecutor on June 13, in another effort to obtain Allen’s mental health records, the prosecution alleged that Allen admitted to the killings “no less than 5 times while talking to his wife and his mother on the public jail phones.”
The April 20 document filed by the prosecutor also noted that “investigators believe they hear the sound of a gun being cycled” on the video recovered from Libby’s phone.
According to video recovered from one of the victim’s phones, Abby or Libby mentioned “gun” as a man approached them, according to the probable cause affidavit. A .40-caliber unspent round was found less than 2 feet away from one of the girls’ bodies, and that unspent round went through a gun that Allen owns, according to the probable cause affidavit.
Another document released Wednesday mentions the involvement of a knife in the killings.
Authorities believe a gun was used in the girls’ abduction and murders due to the unspent round found by their bodies, the prosecutor said, and authorities believe a “knife was used in the murder of Abigail Williams and Liberty German.”
This document was filed June 13, objecting to the defense’s motion to suppress evidence seized in a search warrant at Allen’s home.
The June 13 document filed by the state objecting to the defense’s motion to suppress also notes “articles of clothing from the girls were missing from the scene” where their bodies were found, “including a pair of underwear and a sock.”
(BOSTON) — A 32-year-old Boston woman is facing criminal charges for allegedly enrolling and posing as a student in three Boston high schools, court records show.
Shelby Hewitt, of Canton, Massachusetts, reportedly went by the name Ellie and had recently enrolled at English High School, before school administrations uncovered issues with her enrollment paperwork in mid-June, according to a police incident report.
Administrators began investigating the case after a man who claimed to be the father of Ellie said he was withdrawing her due to bullying, according to the police report. The administrators found that “odd” because she had enrolled the week prior and were “concerned that there may be some sort of custodial issue with the parents,” according to the report.
School administrators uncovered that a social worker listed on her enrollment paperwork did not appear to exist and called 911, according to the report.
A search of Hewitt’s bedroom allegedly uncovered multiple forged documents, including ones from the Department of Children and Families, the report said. Investigators believe she falsely represented herself as another person to “obtain services from the Boston Public Schools” at three high schools between Sept. 7, 2022, and June 14, 2023, the report stated.
Hewitt was charged with six counts, including forgery and identity fraud, according to a criminal complaint filed on Tuesday in Boston Municipal Court.
She has not been formally taken into custody, Boston police said.
It is unclear if she has an attorney who can speak on her behalf. The woman’s father told Boston ABC affiliate WCVB she is receiving mental health treatment.
The school district alerted families to the incident last week amid the criminal investigation. In a letter to families on June 20, Boston Public Schools Superintendent Mary Skipper said an adult woman used falsified identification and paperwork to register as a student this academic year.
Skipper said the adult woman was “discharged” and is being ordered to stay away from BPS facilities.
“At various points during the 2022-2023 school year, this individual attended the Jeremiah E. Burke High School, Brighton High School, and English High School utilizing the student transfer process and enrolling under multiple pseudonyms,” Skipper said.
“While the investigation is in its early stages and remains ongoing, school officials have not identified any incidents of harm to students or staff. At this time families of students who may have interacted with this individual are being contacted directly by school staff and investigators,” Skipper said.
In a statement earlier this month, Skipper praised district staff who “caught” this after identifying irregularities with the student’s enrollment and reported it to Boston police.
“I am deeply troubled that an adult would breach the trust of our school communities by posing as a student,” Skipper said. “This appears to be a case of extremely sophisticated fraud.”
Boston Mayor Michelle Wu told reporters following the discovery that there did not appear to be any “harm or risk” to students.
“You think you’ve seen everything,” Wu said. “We’re looking into [making] sure we can find out all the details of what happened here and what the motivation might have been.”
(WASHINGTON) — As the 2024 election gets underway, House Speaker Kevin McCarthy, who hasn’t yet endorsed anyone in the Republican presidential primary, was quick this week to walk back a comment casting doubt on Donald Trump’s reelection chances.
McCarthy called Trump on Tuesday to explain what he said earlier that day on CNBC — highlighting the fact that the speaker still has loyalty to the former president, a source told ABC News.
“Can he win that election? Yeah, he can win that election. The question is, is he the strongest to win the election? I don’t know that answer,” McCarthy had said during an interview with CNBC’s Joe Kernen. “But can anybody beat Biden? Yeah, anybody can beat Biden. Can Biden beat other people? Yes, Biden can beat them. It’s on any given day.”
McCarthy also said then that “Trump’s policies are better” than Biden.
The speaker quickly backtracked the part of his remarks about Trump’s chances, initially telling Breitbart that “Trump is stronger today than he was in 2016” and pointing to a Morning Consult poll that showed Trump beating Biden. (Other recent surveys have showed Biden with an edge over Trump.)
“As usual, the media is attempting to drive a wedge between President Trump and House Republicans as our committees are holding Biden’s [Department of Justice] accountable for their two-tiered levels of justice,” McCarthy told the right-wing outlet.
ABC News’ Rachel Scott — who was one of two reporters on a plane with Trump to New Hampshire on Tuesday — said Trump was taking note of what McCarthy said: While on the plane, he pulled out a stack of papers, which included McCarthy’s comments.
This is not the first time the two were at odds. After the Jan. 6 attack on the U.S. Capitol, McCarthy said Trump “bears responsibility” for what happened.
Weeks later, McCarthy visited Trump at Mar-a-Lago in Florida and posed together for a picture. “I can talk to anyone,” McCarthy said at the time. “Just as I can go talk to Joe Biden if President Biden wants to talk.”
Trump supported McCarthy during the House speaker race in January and made calls to several GOP holdouts to help change votes in McCarthy’s favor. In order to keep his slim majority, McCarthy has also, at specific moments, pledged to take actions in the House to defend Trump.
The speaker said last week that he supports two resolutions to “expunge” Trump’s two impeachments — the most of any former president — and has publicly slammed the DOJ for Trump’s indictment after allegedly mishandling government secrets while out of office.
McCarthy said the House GOP will also use its power to, in his words, hold Manhattan District Attorney Alvin Bragg accountable and had the Judiciary Committee chairman push for documents and information from the prosecutor, who brought charges against Trump for falsifying business records, to which Trump pleaded not guilty.
Bragg’s attorney has said McCarthy and other lawmakers “have chosen to collaborate with Mr. Trump’s efforts to vilify and denigrate the integrity of elected state prosecutors and trial judges.”
(WASHINGTON) — Republican presidential candidates who qualify for the first primary debate will have to satisfy one final, somewhat controversial requirement, sources say: signing a pledge to back whomever the party’s eventual nominee is, including if it’s Donald Trump.
Two sources familiar with the discussion told ABC News that the pledge will only be presented to candidates for their signature after they earn their spot on the debate stage, in Milwaukee in August, rather than earlier in the process.
This order would signal that they cannot lean on the pledge as a reason not to participate.
Three GOP hopefuls who are critical of Trump — former New Jersey Gov. Chris Christie, former Arkansas Gov. Asa Hutchinson and former Texas Rep. Will Hurd — have expressed concerns about the pledge.
Trump himself has not committed to backing another candidate should he lose the primary.
A spokesperson for the Republican National Committee, asked for comment, referred ABC News to what RNC Chair Ronna McDaniel said on Fox News last week: that the pledge was about backing voters’ views.
“Anybody who wants to seek the nomination of our party should pledge to support the voters,” McDaniel said then. “If you go through this process and you take time on the debate stage and you’re going to be there, the No. 1 pledge should be: Beat [Joe] Biden.”
All candidates have up until 48 hours prior to the Aug. 23 debate to prove to the RNC that they’ve hit at least 1% in three national polls or in a mix of national and early state polls recognized by the committee plus accrued 40,000 individual donors to their campaigns from at least 200 unique donors per state in 20 or more states.
Hutchinson, who is polling at 1.1% according to an average from FiveThirtyEight, has publicly objected to both the loyalty pledge requirement and donor threshold, which he said was too limiting.
His campaign pressed RNC officials to reconsider the pledge after Trump was federally charged earlier this month, now facing two criminal prosecutions. (Trump has pleaded not guilty in both.)
During a call between RNC leaders and a staff member of the Hutchinson campaign on June 15, party officials insisted there would not be any changes to their debate guidelines.
“Individuals who are seeking the Republican nomination for President are being asked to respect the decision of Republican Primary voters and support the eventual nominee they pick to beat Biden,” RNC senior adviser Richard Walters told ABC News’ Rachel Scott in a statement. “Candidates who are complaining about this to the press should seriously reconsider their priorities and whether they should even be running.”
Hutchinson’s campaign subsequently took issue with the party’s plan not to deliver the loyalty pledge to candidates until they have met donor and polling benchmarks.
“It’s been our understanding that the text of the pledge would be provided to the campaigns well in advance of whatever deadline is set by the RNC,” Hutchinson’s campaign manager, Rob Burgess, told ABC News.
Nonetheless, Burgess said, “I am confident Gov. Hutchinson will be on the debate stage in order to demonstrate what true consistent conservative leadership looks like.”
Christie has also made his displeasure with the pledge clear, calling it a “useless idea” and telling ABC News anchor George Stephanopoulos earlier this month that he would take the pledge “just as seriously as” Trump did in the 2016 election cycle — that is to say, he would disregard it as needed.
During the 2016 cycle, Texas Sen. Ted Cruz and then Ohio-Gov. John Kasich also suggested they would drop the pledge. Cruz later endorsed Trump.
A spokesperson for Christie’s campaign referred ABC News to what Christie said on CNN in regard to his thoughts on the pledge, which they said he’s also expressed directly to McDaniel and the RNC.
“In all my life, we never had to have Republican primary candidates take a pledge. You know, we were Republicans. And the idea is you support the Republicans, whether you won or whether you lost. And you didn’t have to ask somebody to sign something. It’s only the era of Donald Trump that you need somebody to sign something on a pledge. So I think it’s a bad idea,” Christie said on CNN.
“But look, I will do what I need to do to be up on that stage to try to save my party and save my country from going down the road of being led by three time loser Donald Trump.”
Hurd, upon his long shot entrance into the GOP field last week, hesitated when asked on CNN if he thought he would be able to get on the debate stage.
He also said he wouldn’t sign a candidate pledge or support Trump should Trump become the nominee. He suggested that the RNC was attempting to tip the scales of the primary by implementing debate requirements like the pledge.
“The bottom line is this: I’ve taken one pledge and that’s when I put my hand on the heart to pledge allegiance to the flag. I’ve taken one oath, asked to defend the Constitution of America. And I’ve taken one vow, to my amazing, beautiful wife,” Hurd said.
In response to the RNC’s claim that they will not deliver the loyalty pledge to candidates until they qualify for polling and donor thresholds, Hurd told ABC: “I’m not in the business of lying to the American people for the sake of a microphone. I fully intend to get to 40,000 donors, meet the polling threshold, and show up to Milwaukee for the debate. I will not sign a pledge to any political leader, so go to my website and donate to see what the RNC does on August 23rd.”
Meanwhile Trump’s chief primary rival, Florida Gov. Ron DeSantis, said earlier this month that he would “respect the outcome of the process” but stressed that he intended to win.
“I think I’m going to be the nominee,” he said. “No matter what happens, I’m going to work to beat Joe Biden.”
ABC News’ Libby Cathey, Will McDuffie and Rachel Scott contributed to this report.
(ALBANY, N.Y.) — The owners, operators and landlords of four nursing homes in New York for years misused more than $83 million in taxpayer money, leaving elderly people in their care dead, neglected or humiliated by sitting in their own urine and feces, New York Attorney General Letitia James said Wednesday in a new lawsuit.
The lawsuit accuses the executives and the corporations behind nursing homes in the Bronx, Queens, Westchester and Buffalo of enriching themselves by diverting Medicare and Medicaid funds away from residential care.
The nursing homes, owned and operated by Centers Health Care, include Beth Abraham Center in the Bronx, Buffalo Center for Rehabilitation and Nursing, Holliswood Center for Rehabilitation and Healthcare in Queens, and Martine Center for Rehabilitation and Nursing in Westchester County. Residents at these facilities suffered from severe dehydration, malnutrition, and increased risk of death, developed infections and sepsis from untreated bed sores and inconsistent wound care, sustained life-changing injuries from falls, and died, the lawsuit said.
Responding to the filing on Wednesday, Centers Health Care spokesperson Jeff Jacomowitz said in a statement to ABC News they would fight the allegations.
“Centers Health Care prides itself on its commitment to patient care. Centers denies the New York Attorney General’s allegations wholeheartedly and attempted to resolve this matter out of court. We will fight these spurious claims with the facts on our side. Beyond that, Centers Health Care will not comment on ongoing litigation,” the statement read.
This is the fourth – and largest – enforcement action the attorney general’s office has taken in recent months that aims to stop fraud in nursing homes. The nursing home issues were first raised during the COVID-19 pandemic though the lawsuit claims the alleged horrors preceded the pandemic.
Just two months into the pandemic, 70 residents – nearly a quarter of Holliswood Center’s population – had died from COVID-19. More than 400 residents died across all four nursing homes in 2020.
“Nursing homes are meant to be safe spaces where the most vulnerable members of our community receive the care and dignity they deserve. Instead, the owners of Centers Health Care allegedly used these four nursing homes – and the vulnerable New Yorkers who lived there – to extract millions of dollars for their personal use, leading to elderly residents and those with disabilities suffering unconscionable pain, neglect, degradation, and even death,” James said in a statement announcing the lawsuit.
According to the suit, due to insufficient staffing, staff members were often unable to assist residents with basic activities of daily living, such as help using the bathroom, getting in and out of bed, eating, and maintaining personal hygiene. Call bells were routinely ignored or unanswered, meals were not provided in a timely manner and personal belongings were lost or stolen, including hearing aids, dentures, clothing, and even an electronic piano, the suit alleges. Residents, family members, and staff reported unsanitary conditions, including neglected food trays, vermin, flies and persistent smells of human waste.
(NEW YORK) — Marine veteran Daniel Penny’s comments to police following the fatal chokehold of Jordan Neely in a New York City subway have been released in new documents.
“He came on and he threw s—, he’s like ‘I don’t give a s—, I’m going to go to prison for life’ and stuff, so I just came up behind him and put him in a chokehold. He was threatening everybody,” a court filing accompanying Penny’s indictment quoted him telling officers on May 1.
“We just went to the ground. He was trying to roll up, I had him pretty good. I was in the Marine Corps,” he told officers.
Penny was charged with second-degree manslaughter and criminally negligent homicide Wednesday in connection with the May 1 chokehold death of Neely aboard a New York City subway train.
“Daniel Penny stands indicted for manslaughter after allegedly putting Jordan Neely in a deadly chokehold for several minutes until and after he stopped moving. I hope Mr. Neely’s loved ones are on the path towards healing as they continue to mourn this tragic loss,” said District Attorney Alvin Bragg.
Penny, 24, pleaded not guilty to the charges and is free on $100,000 bail. His next court appearance is October 25.
Penny was indicted by a grand jury on June 14.
According to court documents and statements, Neely entered the train at the 2nd Avenue station and began making verbal threats to passengers. Less than a minute later, Penny put Neely in a chokehold, which lasted for several minutes.
Police sources told ABC News that Penny was not specifically being threatened by Neely when he intervened and that Neely had not become violent and had not been threatening anyone in particular.
Neely was homeless at the time of the incident.
Members of Neely’s family sat in the second row during Penny’s court appearance. Penny’s relatives sat in the row behind them.
Outside court, defense attorneys spoke confidently about Penny’s ability to be found not guilty.
“We are a long way off from trial, but all the evidence we’ve seen is that our client acted under the law,” defense attorney Thomas Keniff said.
Neely’s family and supporters denounced Penny and expressed their hope for justice.
“Daniel Penny did not have the courage to look Mr. Jordan’s father in the eye,” said attorney Dante Mills, who is representing the Neely family.
(NEW YORK) — The U.S. could soon be paying an additional $1 billion in healthcare expenses each summer due to forecasts of continuing waves of extreme heat in the near future, a new report has found.
The additional cost in heat-related healthcare will stem from 235,000 visits to the emergency room and more than 56,000 additional hospital admissions across the country each summer, the research, conducted by Virginia Commonwealth University and the Center for American Progress, a liberal think tank, found.
An increase of prolonged periods of heat has coincided with the rise of incidences in heat-related illness, the report, which studied data from Virginia-based weather stations and Virginia medical insurance claims, found.
“The resulting increases in visits to physicians, visits to emergency departments, and admissions to hospitals will inflate U.S. health care costs,” the researchers said.
Currently, heat events result in nearly 400 additional ambulatory — or outpatient — care visits for heat-related illness, almost 7,000 additional emergency department visits and about 2,000 additional heat-related hospital admissions, mostly for heat-adjacent illness, according to the report.
The report was published as record heat has spread across the country. Heat indexes are measuring in the triple digits from California to Florida and expanding north into Colorado, Kansas, Indiana and Kentucky.
Emergency room visits and 911 calls for heat-related emergencies in Texas have increased in the past month due to the weeks-long heat dome sitting over the region, data from the Centers for Disease Control and Prevention shows.
The researchers urged lawmakers at all levels of government, as well as those in the private sector, to confront the climate crisis by severely reducing greenhouse gas emissions, establishing and strengthening federal, state, and local governmental responsibilities for extreme heat protection and improving data surveillance and prediction capabilities.
It will also be imperative to raise public awareness surrounding the risks of extreme heat and protective measures, the researchers said.
Heat is the No. 1 weather-related killer in the world, with more than 600 people dying from heat-related illnesses every year in the U.S., according to the CDC.
Extreme heat, which climate scientists say will grow more frequent and intense due to global warming, is already costing the global economy trillions of dollars. An increasing number of heat waves between 1992 and 2013 caused an estimated $16 trillion loss in the global economy due to the effects of high temperatures on human health, productivity and agricultural output, a 2022 study by Dartmouth University found.
Global warming “statistically coincided with variations in economic growth” during that time period, the researchers found.
If greenhouse gas emissions continue to increase, 70% of the population in several countries most at risk for extreme heat will require air conditioning by 2050 in order to stay safe from the heat, researchers at Harvard University found in 2022.
(WASHINGTON) — The watchdog report released Tuesday that revealed how some $200 billion in COVID-19 aid was potentially misspent threw into sharper relief how one pandemic-era program emerged above all others as a magnet for fraudsters: the Economic Injury Disaster Loan program, or EIDL.
Launched in March 2020, at the outset of the pandemic, EIDL was designed to distribute fast loans to help small businesses retain employees and stay on top of bills as the economy sputtered. By all accounts, it worked, rescuing jobs and businesses across the country.
But the program was also plagued by fraud. Of the $400 billion in taxpayer money doled out as part of EIDL, more than a third — some $136 billion — might have gone to fraudsters, according to the report published this week by Hannibal “Mike” Ware, the Small Business Administration’s inspector general.
The sizeable figure seems to justify Ware’s projection in a 2021 interview with ABC News that, “in terms of the monetary value, the amount of fraud in these COVID relief programs is going to be larger than any government program that came before it.”
“It is a shockingly high level of potential fraud and one that should have been reduced greatly,” said Sean Moulton, a senior policy analyst at the Project on Government Oversight, a nonpartisan government watchdog group.
All told, the federal government flooded the economy with some $5 trillion to support companies and individuals as the COVID-19 pandemic bore down on the country, including more than $1.2 billion specifically earmarked for small businesses.
To help expedite the relief funding, the Small Business Administration “lowered the guardrails,” the agency’s watchdog later said, opting to drop burdensome and time-consuming internal controls and accepting some amount of fraud — then pledging to recover squandered funds on the back end.
“The allure of ‘easy money’ in this pay-and-chase environment attracted an overwhelming number of fraudsters to the programs,” according to the inspector general’s new report.
Fraudsters used a myriad of tactics to manipulate the program, the report said.
Many fraudsters took advantage of EIDL advances, which allowed applicants to apply for $1,000 per employee — up to $10,000 total — in grants that would not need to be repaid. The advances were self-certified, meaning the number of employees “was not vetted by SBA,” the watchdog wrote — a loophole that many fraudsters exploited.
Other fraudsters used scams to steal victims’ identities, and then used their personal information to file fraudulent EIDL claims.
The “easy money” in EIDL was so lucrative that it prompted the creation of a cottage industry: The inspector general’s report highlighted a perpetrator who “took his talents to the web, schooling other would-be fraudsters on how to rip off programs meant for struggling entrepreneurs during a crisis.”
Another duo pleaded guilty to “perpetrating a vast nationwide scheme to help others submit fraudulent COVID-19 EIDL and PPP loan applications” for a fee, the report said.
The SBA, in a response included in the report, pushed back on some of the inspector general’s findings, saying that it welcomed the review but believes the report “contains serious flaws that significantly overestimate fraud.”
The inspector general’s review allowed for “a high percentage of false positives,” or potential fraud cases that, upon further inspection, were not fraud, Bailey DeVries, Acting Associate Administrator of the SBA, said in the response.
Since launching its investigation, Ware’s office has managed to claw back around $30 billion in funds, according to the report, and their efforts have led to “1,011 indictments, 803 arrests, and 529 convictions related to COVID-19 EIDL and PPP fraud as of May 2023,” the report said.
Ware will appear before Congress in July to discuss his findings under oath.
