U.S. GOVERNMENT PUBLISHING OFFICE

50–896 PDF WASHINGTON : 2023

FEDERAL PANDEMIC SPENDING: 

A PRESCRIPTION FOR WASTE, 

FRAUD AND ABUSE 

HEARING 

BEFORE THE

COMMITTEE ON 

OVERSIGHT AND ACCOUNTABILITY 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED EIGHTEENTH CONGRESS 

FIRST SESSION 

FEBRUARY 1, 2023 

Serial No. 118–1 

Printed for the use of the Committee on Oversight and Accountability 

( 

Available on: govinfo.gov, 

oversight.house.gov or 

docs.house.gov 
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COMMITTEE ON OVERSIGHT AND ACCOUNTABILITY 

JAMES COMER, Kentucky, Chairman 

JIM JORDAN, Ohio 

MIKE TURNER, Ohio 

PAUL GOSAR, Arizona 

VIRGINIA FOXX, North Carolina 

GLENN GROTHMAN, Wisconsin 

GARY PALMER, Alabama 

CLAY HIGGINS, Louisiana 

PETE SESSIONS, Texas 

ANDY BIGGS, Arizona 

NANCY MACE, South Carolina 

JAKE LATURNER, Kansas 

PAT FALLON, Texas 

BYRON DONALDS, Florida 

KELLY ARMSTRONG, North Dakota 

SCOTT PERRY, Pennsylvania 

WILLIAM TIMMONS, South Carolina 

TIM BURCHETT, Tennessee 

MARJORIE TAYLOR GREENE, Georgia 

LISA MCCLAIN, Michigan 

LAUREN BOEBERT, Colorado 

RUSSELL FRY, South Carolina 

ANNA PAULINA LUNA, Florida 

CHUCK EDWARDS, North Carolina 

NICK LANGWORTHY, New York 

ERIC BURLISON, Missouri 

JAMIE RASKIN, Maryland, Ranking Minority 

Member 

ELEANOR HOLMES NORTON, District of 

Columbia 

STEPHEN F. LYNCH, Massachusetts 

GERALD E. CONNOLLY, Virginia 

RAJA KRISHNAMOORTHI, Illinois 

RO KHANNA, California 

KWEISI MFUME, Maryland 

ALEXANDRIA OCASIO-CORTEZ, New York 

KATIE PORTER, California 

CORI BUSH, Missouri 

SHONTEL BROWN, Ohio 

JIMMY GOMEZ, California 

MELANIE STANSBURY, New Mexico 

ROBERT GARCIA, California 

MAXWELL FROST, Florida 

BECCA BALINT, Vermont 

SUMMER LEE, Pennsylvania 

GREG CASAR, Texas 

JASMINE CROCKETT, Texas 

DAN GOLDMAN, New York 

JARED MOSKOWITZ, Florida 

MARK MARIN, Staff Director 

JESSICA DONLON, Deputy Staff Director & General Counsel 

DANIEL ASHWORTH, Deputy Chief Counsel for Oversight 

RAJ BHARWANI, Senior Professional Staff Member 

SARAH FEENEY, Professional Staff Member 

MALLORY COGAR, Deputy Director of Operations and Chief Clerk 

CONTACT NUMBER: 202-225-5074 

JULIE TAGEN, Minority Staff Director 
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C O N T E N T S 

Page 

Hearing held on February 1, 2023 ......................................................................... 1 

WITNESSES

The Honorable Gene L. Dodaro, Comptroller General of the United States, 

Government Accountability Office 

Oral Statement ................................................................................................. 6 

The Honorable Michael E. Horowitz, Chair, Pandemic Response 

Accountability Committee 

Oral Statement ................................................................................................. 7 

Mr. David M. Smith, Assistant Director, Office of Investigations, U.S. Secret 

Service 

Oral Statement ................................................................................................. 9 

Ms. Rebecca Dixon, Executive Director, National Employment Law Project 

Oral Statement ................................................................................................. 81 

Opening statements and the prepared statements for the witnesses are available in the U.S. House of Representatives Repository at: docs.house.gov. 
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INDEX OF DOCUMENTS 

* Memo, Implementation Guidance for Supplemental Funding Provided in 

Response to COVID-19; submitted by Rep. Raskin. 

* Report, PRAC, ‘‘State-Entitled Key Insights in State Pandemic 

Unemployment Insurance Programs;’’ submitted by Rep. Ocasio-Cortez. 

* Article, New York Times, ‘‘How Bar’s Quest to Find Flaws in the Russia 

Inquiry Unraveled;’’ submitted by Rep. Goldman. 

* Letter, Jan. 31, 2023, from Reps. Lieu and Goldman, to Inspector General 

Barr Durham; submitted by Rep. Goldman. 

* Graphic, COVID Funding; submitted by Rep. Luna. 

* Letter, January 31, 2023, from Office of the Inspector General, Social 

Security Administration, to Chairman Comer; submitted by Chairman 

Comer. 

* Letter, January 27, 2023, from Sen. Sen. Ernst, to Chairman Michael 

Horowitz; submitted by Rep. Burlison. 

* Article, Politico, ‘‘Biden Administration Reroutes Billions in Emergency 

Stockpile, COVID Funds to Border Crunch;’’ submitted by Rep. Donalds. 

* Report, Small Business Administration, OIG, ‘‘Paycheck Protection 

Program Eligibility for Non-Profit Organizations;’’ submitted by Rep. 

Brown. 

* Statement for the Record; Ranking Member Connolly; submitted by 

Ranking Member Connolly. 

* Questions for the Record: to Mr. Dodaro; submitted by Chairman Comer. 

* Questions for the Record: to Mr. Dodaro; submitted by Rep. Palmer. 

* Questions for the Record: to Mr. Dodaro; submitted by Rep. Donalds. 

* Questions for the Record: to Mr. Dodaro; submitted by Rep. Perry. 

* Questions for the Record: to Mr. Michael Horowitz; submitted by Chairman Comer. 

* Questions for the Record: to Mr. Michael Horowitz; submitted by Rep. 

Palmer. 

* Questions for the Record: to Mr. Michael Horowitz; submitted by Rep. 

Perry. 

* Questions for the Record: to Mr. Michael Horowitz; submitted by Luna. 

* Questions for the Record: to Mr. Smith; submitted by Chairman Comer. 

* Questions for the Record: to Mr. Smith; submitted by Rep. McClain. 

* Questions for the Record: to Mr. Dodaro; submitted by Rep. Raskin. 

* Questions for the Record: to Mr. David Smith; submitted by Rep. Raskin. 

* Questions for the Record: to Mr. Michael Horowitz; submitted by Rep. 

Raskin. 

The documents listed are available at: docs.house.gov. 
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FEDERAL PANDEMIC SPENDING: 

A PRESCRIPTION FOR WASTE, 

FRAUD AND ABUSE 

Wednesday, February 1, 2023 

HOUSE OF REPRESENTATIVES, 

COMMITTEE ON OVERSIGHT AND ACCOUNTABILITY, 

Washington, D.C. 

The committee met, pursuant to notice, at 10:05 a.m., in room 

2154, Rayburn House Office Building, Hon. James Comer (chairman of the committee) presiding. 

Present: Representatives Comer, Gosar, Foxx, Grothman, Palmer, Higgins, Biggs, Mace, LaTurner, Fallon, Donalds, Sessions, 

Armstrong, Perry, Timmons, Burchett, Greene, McClain, Boebert, 

Fry, Luna, Edwards, Langworthy, Burlison, Raskin, Norton, Lynch, 

Connolly, Krishnamoorthi, Khanna, Mfume, Ocasio-Cortez, Porter, 

Bush, Brown, Gomez, Stansbury, Garcia, Frost, Balint, Lee, Casar, 

Crockett, Goldman, and Moskowitz. 

Chairman COMER. We will call this hearing to order, the first 

hearing of the 118th Congress for the House Committee on Oversight and Accountability. Welcome. 

As chairman, I intend to focus this committee’s attention and resources on its core mission, to ensure our government is working 

for the American people in an efficient manner, agencies guard taxpayer funds from fraudsters and ineligible participants, and political leadership be held accountable for bad consequences of their 

policies. 

Last Congress, Democrats strayed far from this mission. The 

Biden Administration faced little to no scrutiny under unchecked 

one-party Democrat rule in Washington. This committee conducted 

almost no oversight of Federal Government agencies, programs, or 

policies. The non-partisan Lugar Center gave Democrats an F in 

oversight last Congress. Instead, this committee spent its time and 

resources demonizing America’s oil and gas industry, investigating 

an NFL football team, and examining pet flea and tick collars. 

The American people have suffered from the lack of oversight 

and accountability. Crises have continued and worsened. Our Nation is facing the worst border crisis in American history. Fentanyl, 

which is coming across the Southern border, is the leading cause 

of death for many Americans. Americans are facing high energy 

prices resulting from policies aimed at diminishing domestic energy 

production, and the American people have struggled with consequences of prolonged COVID closures and lockdowns, inflation, 
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and shortages of labor and goods. That is why this first hearing is 

so important. 

Today’s hearing is the first step in examining the massive waste, 

fraud, and abuse in COVID relief programs. In March 2020, the 

United States struggled to respond to growing threats presented by 

COVID–19. With the economy on the brink of collapse, Congress 

passed a series of bills intended to both fund the public health response and keep the economy afloat. The largest of these measures 

was the Bipartisan CARES Act. It created programs like the Paycheck Protection Program, which saved jobs at small businesses 

across the country. It rolled out pandemic unemployment insurance 

to help American workers who were victims of business closures 

and spiking unemployment. These programs brought relief to many 

Americans, but with massive government spending comes opportunity for waste, fraud, and abuse. 

Unfortunately, Democrats conducted little oversight of the over $2 trillion spent under the CARES Act. They did the exact opposite. They spent another $2 trillion, but this time with absolutely 

no protections or guardrails to prevent waste. And worse, they 

spent this money when there was no sign that it was actually needed. This out-of-control spending led to 40-year high inflation, kept 

people out of work longer, and harmed our economy. During the 

markup for this legislation, many of us warned that without oversight mechanisms in place, taxpayer dollars were at risk of being 

misused or lost to fraud, waste, or abuse. 

Republican amendments would have put strings attached on 

those dollars. They would have allowed for oversight, but Democrats voted down every single amendment we offered. And what 

happens if there is no oversight? Nothing good. We have seen reports that between $163 billion to $400 billion in unemployment insurance benefits were paid out improperly. We have seen reports 

that between $76 billion to more than $100 billion in Paycheck Protection Program and Economic Injury and Disaster Loan Programs 

were lost to improper payments. We have seen reports that $266 

billion in improper payments were made by Medicaid during the 

pandemic. That is why we are having our first hearing of the new 

Congress on waste, fraud, abuse in pandemic spending programs. 

We will hold many more of these hearings on this important issue. 

We owe it to the American people to get to the bottom of the 

greatest theft of American taxpayer dollars in history. We must 

identify where this money went, how much ended up in the hands 

of fraudsters or ineligible participants, and what should be done to 

ensure that it never happens again. This committee will evaluate 

the hundreds of billions of dollars in grants and loans doled out for 

nearly every agency in the Federal Government to ensure those 

funds were appropriately used to respond to the pandemic and not 

wasted on ineligible payees or unrelated matters. 

We will investigate the $189 billion in elementary and secondary 

school emergency relief funds, money meant to help reopen schools 

and address learning loss. Instead, these funds were often used on 

unrelated expenditures and even to push divisive ideologies onto 

our students. We will work to ensure that the watchdogs in our offices of Inspectors General and our law enforcement officers, 

agents, and prosecutors have the tools they need to track down 
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fraudsters and recover illegally obtained COVID–19 taxpayer 

funds. 

This committee has for too long stood on the sidelines while taxpayer dollars were wasted by bureaucrats, whose only priority is 

getting money out the door. Today, we will hear from Inspector 

General Michael Horowitz, GAO’s comptroller general, Gene 

Dodaro, and assistant director, David Smith, with the Office of Investigations at the Secret Service. Thank you all for being here to 

testify about your efforts to conduct oversight of pandemic funding. 

I now yield to Ranking Member Raskin for his opening statement. 

Mr. RASKIN. Mr. Chairman, thank you kindly. Our committee’s 

purpose is to ensure that government is effectively delivering on its 

promises to the American people. And as the new ranking member, 

I am eager to work with you and the rest of the committee in carrying out this shared responsibility in a thorough, serious, nonpartisan, and even-handed way. 

When I heard that our first hearing would spotlight pandemic relief programs, I was pleased because I thought it would follow up 

on everything the Democratic majority had been doing in the 117th 

Congress since COVID–19 began. I was hopeful for an opportunity 

to consider together how we can identify schemes of fraud and selfenrichment, ripping off the taxpayers, and continue to strengthen 

the structural efficiency of critical government programs that help 

families and businesses across America meet the challenges of the 

pandemic. Just as the political system and the campaign finance 

system have recently been proven shockingly vulnerable to imposters, hustlers, con men, big liars, outright fraudsters, and fakes, 

some of the programs developed to respond to the COVID–19 pandemic have proven vulnerable to the relentless, deceitful, and 

fraudulent designs of criminal predators when they, too, decide to 

exploit the generosity of the American people. The traditional language of waste, fraud, and abuse does not quite capture the confidence games in organized criminal artifices and schemes that 

have targeted and exploited relief programs built on the solidarity 

and goodwill of the American people. 

The House Select Subcommittee on the Coronavirus, which was 

chaired in the last Congress by then Majority Whip Clyburn, and 

which I served on, led the effort to identify and combat these criminal actors. The subcommittee conducted no fewer than seven hearings focused on rooting out fraud in relief programs. I will never 

forget how under Chairman Clyburn’s leadership, in our first week 

or two of existence, the subcommittee recovered an improper $10 

million Paycheck Protection Program loan. Less than three months 

later, we helped secure the return of $109 million from a nursing 

home chain that was not using the loan as Congress had specifically intended. 

In March 2021, we exposed how the Trump administration’s 

reckless mismanagement of small business relief programs and refusal to implement basic anti-fraud controls led to nearly $84 billion in fraudulent loans. Just months later, we issued another report highlighting how the Trump administration awarded $95.7 

million in pandemic Food Box Program funds to three companies 

that all raised severe red flags. Then again, in April 2022, we 
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showed how Trump White House officials overruled career Department of Defense officials to approve a $700 million national security loan to a single company in violation of legal requirements, 

and so on. We used the spotlight and bully pulpit of a small subcommittee to expose and reverse colossal frauds taking place 

against the American people. 

While I remain optimistic that this hearing can meaningfully explore ways to ensure the taxpayer dollars go where intended, I confess I am troubled that some of our colleagues seem to want to 

cherry pick facts and deploy distorted figures to attack the underlying legitimacy of the programs themselves, the programs that 

were a lifeline and salvation for millions of businesses and families 

across the country. Recall that while the former President denied, 

trivialized, and dismissed the COVID–19 pandemic, it was Congress which acted responsibly, and swiftly, and in bipartisan fashion to create and supercharge programs that saved countless businesses and families from bankruptcy and ruin. These programs included expanded unemployment insurance benefits and the PPP 

Program, which empowered families and businesses to avoid economic collapse. As a result of our actions, the COVID–19 economic 

recession was the shortest on record. 

The programs were by no means perfect. Antique government IT 

systems, many running on obsolete software, collapsed and were 

incapable of adapting to the scope of the crisis. States entered the 

pandemic at a 50-year low for unemployment insurance system 

funding, and UI claims burgeoned from 211,000 to 6.6 million, a 

3,000 percent increase over a three-week period in March 2020. 

People unsure of how they would pay their housing or medical bills 

panicked as they waited hours on phone calls for customer service 

representatives were reached, to endless busy signals in unemployment insurance purgatory. My home state of Maryland was no exception. In the one-year period from March 2020 until March 2021, 

my district office received 1,400 anguished constituent requests for 

help with unemployment. This is in contrast to one constituent request we received in all of 2019. 

Congress asked agencies and states to do the near impossible, 

and they did their very best. Expanded UI benefits kept an estimated 5 million to 6 million people out of poverty in 2020 and 6.7 

million people above the poverty line in 2021. The Center for Budget and Policy Priorities estimates that expanded benefits may have 

saved the lives of as many as 27,000 people in high-risk occupations who may have died from COVID had they not had access to 

benefits. 

Organized criminals and fraudsters took advantage of these circumstances by exploiting weaknesses in our IT systems. This problem was compounded by critical decisions made by the Trump administration that hamstrung pandemic relief and anti-corruption 

oversight from the very outset, crippling the government’s ability 

to detect fraud. Despite specific legislative instruction from Congress in our pandemic relief bills, the Trump administration regularly told agencies to ignore data reporting requirements. But congressional Democrats and the Biden Administration have worked 

diligently from the start to recover funds stolen by organized criminal groups and other fraudsters, helped states modernize their IT 
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systems, and build new structural capacities to detect and prevent 

fraud. Under President Biden’s leadership, departments and agencies across the government moved swiftly to strengthen program 

integrity and bolster efforts to prevent, detect, and pursue fraud, 

which festered under the lackadaisical stewardship of the prior administration. 

In the days preceding this hearing, Republicans have claimed 

that Democrats on this committee and in the Biden Administration 

neglected to conduct meaningful oversight of these programs. The 

record demonstrates these assertions are baseless. Democrats have 

systematically ferreted out fraud, waste, and abuse in pandemic relief, although we all can certainly be doing a much more effective 

job, and that is what this hearing should be about. As the work of 

the 118th Congress commences, I urge all of my colleagues across 

the aisle and on our side to remember the crucial role this committee must play in eliminating fraudulent schemes by imposters 

in order to protect the integrity of the programs that we adopt and 

that America needs. With that, Mr. Chairman, I am happy to yield 

back. 

Chairman COMER. The ranking member yields back. It gives me 

great pleasure to introduce our panel. I will go through and introduce each member, and then we will turn it over to begin their 

opening statements, but let me say this. This is a pretty quality 

panel. I think if you wanted to have the perfect hearing to determine waste, fraud, and abuse in the Federal Government, I can’t 

think of three better witnesses from three more appropriate agencies to come before this committee. And I think you will see this 

is going to begin a trend of having credible witnesses that are here 

to talk about serious substantive issues, and I am very proud of 

this witness panel today. 

Our first witness today is Mr. Gene Dodaro, the eighth comptroller general of the United States and head of the U.S. Government Accountability Office, or GAO. In a career spanning over 49 

years at GAO, Mr. Dodaro has worn many hats and testified before 

Congress dozens of times on important national issues, including 

waste, fraud, abuse, and mismanagement in the Nation’s response 

to the Coronavirus pandemic. Mr. Dodaro’s extensive experience at 

the helm of an agency, often referred to as the congressional watchdog, is invaluable. We are glad to have you here for this very important oversight topic, and we look forward to your testimony. 

Our second witness, no stranger to Congress, is Mr. Michael 

Horowitz, who is the chair of the Pandemic Response Accountability Committee, or PRAC, and Inspector General of the Department of Justice. Mr. Horowitz is testifying today in his role as 

chair of PRAC, an entity created by the CARES Act to support 

independent oversight of pandemic relief spending. The PRAC coordinates cross-agency investigations by agency inspectors general, 

enabling faster identification of fraud search across multiple programs. This is a very important role, Mr. Horowitz, and the committee looks forward to learning more about your and your colleagues’ efforts to detect fraud, waste, abuse, and mismanagement 

of taxpayer dollars. 

Our third witness is Mr. David Smith, assistant director Office 

of Investigations at the U.S. Secret Service. As the 28th assistant 
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director for the Office of Investigations, Mr. Smith leads the Agency’s global investigative mission, comprising 161 offices and over 

3,000 employees. Mr. Smith’s office also oversees the Secret Service’s national pandemic fraud investigations and cross-agency coordinated efforts, including investigations of foreign nationals stealing COVID relief funds. I look forward to hearing about the Agency’s investigations into pandemic relief fraud and ongoing efforts to 

counter such activities. Welcome, Mr. Smith. 

We will begin with Mr. Dodaro, and I hope I pronounced that 

right. I apologize if I didn’t. 

STATEMENT OF GENE L. DODARO, COMPTROLLER GENERAL 

OF THE UNITED STATES, UNITED STATES GOVERNMENT 

ACCOUNTABILITY OFFICE 

Mr. DODARO. It was excellent, Mr. Chairman. Very good. I appreciate it. Thank you very much. 

Good morning, Mr. Chairman, Ranking Member Raskin, members of the committee. Very pleased to be here. I commend you, Mr. 

Chairman, for holding this hearing, and I am very pleased to see 

the attendance. 

I would like to focus my comments this morning on four points 

that I believe were the main causes of the widespread fraud that 

has occurred and what could be done to deal with these issues. 

First, agencies should have been much better prepared in order to 

prevent fraud in the first place. We worked with the Congress back 

in 2016 when the Congress passed the Fraud Reduction and Data 

Analytics Act, which required agencies to implement GAO’s fraud 

risk framework to help prevent fraud in the first place. Agencies 

were slow to implement this legislation and, therefore, were not 

prepared properly when the Coronavirus emergency occurred. This 

needs greater attention and oversight, I believe, from this committee. 

Second, the urgency in providing relief funds led to tradeoffs that 

limited the ability to achieve accountability and transparency goals 

of the legislation. These tradeoffs included allowing self-certifications and applications, limiting the amount of supporting documentation that applicants had to apply. These tradeoffs, along with 

internal control weaknesses within the agencies, made these programs much more susceptible to fraud than otherwise would have 

been the case. Now, Congress rectified some of these tradeoffs in 

subsequent legislation. Agencies have begun to implement our recommendations, but there is much more that needs to be done to 

deal with the remaining COVID programs to catch people who 

have perpetrated fraud and bring them to justice. But unless we 

make these changes, we are not better prepared for the future, for 

future emergencies, which certainly will come with disaster assistance, and relief, and other events that are unforeseen, but certainly 

will come. 

Third, advocating, and I have done this before, that there is a 

permanent center for excellence and analytics in the inspector general community. Now, this first one was created back in the Recovery Act when we had the Great Recession, and that recovery operation center helped prevent fraud and enabled the IGs to work to-
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gether because a lot of the fraudsters hit multiple programs as 

well, and this brought in great data analytics experience. Unfortunately, this center was terminated in 2015, and I recommended 

that Treasury had the ability to pick up the center operations. 

They declined on that. I recommended that Congress make it permanent at that point in time. I was not successful. I am at it again, 

and I think it makes sense to have this to deal with. 

Fraud occurs in regular Federal programs all the time, as well 

as improper payments, which we talk about in our statement. If 

you had this permanent capability, it would not only deal with regular fraud, but it would be ready and there when emergencies 

occur, and you won’t waste time standing up. Every day wasted is 

another day susceptible to fraud and improper payments. This 

would help. 

Fourth, the government has an underlying improper payment 

problem. These are payments that shouldn’t have been made or 

made in the wrong amounts, and I have testified before this committee many, many times on this problem over the years. It occurs 

in a wide range of Federal programs. It is pervasive across the government. So, when you have that type of problem that we are not 

dealing with on a regular basis, and you add additional spending, 

billions, hundreds of billions, in this case, trillions of dollars, you 

are going to have these types of problems in place. So, I have many 

recommendations in my testimony that I think would help address 

this issue, and I have put forth at least 10 legislative suggestions 

for how Congress can act to make sure that this problem doesn’t 

happen again at the magnitude in which we have seen in this particular case. 

So, I am looking forward to answering questions today. I am also 

looking forward to working with this committee to put solutions in 

place that can guarantee when the Federal Government finds it 

necessary in this case to provide funds for public health purposes 

and the economic repercussions of disasters, that it is done in a 

way that gets the funds to the people who need it and not allow 

this type of fraudulent activity to plague our national programs. 

Thank you very much, Mr. Chairman. 

Chairman COMER. Thank you. Mr. Horowitz? 

STATEMENT OF MICHAEL E. HOROWITZ, CHAIR, PANDEMIC 

RESPONSE ACCOUNTABILITY COMMITTEE, AND INSPECTOR 

GENERAL, U.S. DEPARTMENT OF JUSTICE 

Mr. HOROWITZ. Thank you. Mr. Chairman, Ranking Member 

Raskin, members of the committee, thank you for holding today’s 

very important hearing. 

This committee has consistently worked on a bipartisan basis 

with the oversight community to advance program payment integrity, government spending transparency, and the use of data analytics, all of which have helped us to fight fraud, waste, and abuse, 

and ensure that government benefits go to those who need them 

most. Yet, as our pandemic oversight work has demonstrated, far 

more can and should be done to protect taxpayer money. 

For example, earlier this week, we issued a fraud alert, finding 

that over 69,000 questionable Social Security numbers were used 
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to obtain $5.4 billion in pandemic loans and grants. This alert resulted from PRAC data scientists using our analytics platform to 

assess over 33 million EIDL and PPP loan applications. From that 

work, they developed a targeted subset of applications and asked 

the Social Security Administration if the name, date of birth, and 

Social Security numbers on those applications fully matched information in SSA’s records. Over 69,000 didn’t. This type of advanced 

data analytics work is transforming how we do oversight and would 

not have been possible without this committee’s support for data 

transparency and spending accountability. 

Our fraud alert also demonstrates the need for additional measures to improve program integrity. In particular, agencies must 

strike a better balance both in times of crises and in routine program administration between the speed with which they issue benefits and the need to assess applicant eligibility before payments 

are sent out. For example, SBA’s central focus on getting PPP 

loans issued as quickly as possible at the outset of the pandemic, 

based solely on an applicant self-certification of eligibility, resulted 

in substantial fraud as well as SBA issuing 57,000 loans worth $3.6 

billion to entities that were already on the government’s Do Not 

Pay list, a list SBA didn’t bother to cross check. 

The Federal Government needs more robust cross-agency data 

sharing agreements to improve program administration, reduce improper payments and identity fraud, and better prepare before the 

next crisis hits. For example, consent-based identity verification 

systems can have a significant impact in reducing identity fraud, 

as we detailed in our fraud alert. Similarly, authorizing agencies 

to access SSA’s Master Death File index would help eliminate improper payments to deceased individuals. These are just two of 

many eligibility verification tools that agencies should be using. 

Our oversight reports also highlight the need for agencies to be 

more transparent about spending information and to address data 

reporting gaps and data reporting weaknesses. The public has a 

right to know how its money is being spent, and policymakers need 

to be able to assess whether programs are effective. Moreover, 

transparency results in greater accountability. As Justice Brandeis 

famously stated, transparency is said to be the best of disinfectants. 

Through our oversight work, we are making progress. For the 

past two years, we have met weekly with OMB leadership and the 

American Rescue Plan implementation team. These meetings have 

enabled the PRAC and IGs to timely share concerns with executive 

branch leadership and ensure that impediments to our oversight 

are being addressed promptly. We have also participated in more 

than two dozen meetings on agency-specific pandemic relief programs prior to their implementation and before money went out 

the door. In December 2021, OMB issued a memorandum highlighting the value of this model and institutionalizing it. 

Finally, let me touch on three PRAC legislative priorities. First, 

we hope Congress will take up legislation to make permanent the 

PRAC’s data analytics platform. Taxpayers need that sophisticated 

tool to continue to exist, and I appreciate the Comptroller General’s 

continued support for that. Second, Congress should consider raising the jurisdictional amount in the Program Fraud Civil Remedies 
9 

Act from $150,000 to $1 million so IGs can more effectively pursue 

smaller-dollar frauds. Finally, Congress should consider extending 

from 5 to 10 years the statute of limitations for pandemic unemployment insurance fraud as it did last year with PPP and EIDL 

fraud. 

The PRAC and the IG community is committed to using all of the 

tools we have been provided—criminal, civil and administrative— 

to pursue for the taxpayers every dollar that fraudsters stole from 

pandemic programs. Thank you for your continued support for 

those efforts, and I would be pleased to answer any questions the 

committee may have. 

Chairman COMER. Thank you, Mr. Horowitz. Mr. Smith? 

STATEMENT OF DAVID SMITH, ASSISTANT DIRECTOR, OFFICE 

OF INVESTIGATIONS, UNITED STATES SECRET SERVICE 

Mr. SMITH. Good morning, Chairman Comer, Ranking Member 

Raskin, and distinguished members of the committee. Thank you 

for the opportunity to appear today and discuss the ongoing efforts 

of the U.S. Secret Service to counter pandemic-related fraud. As 

the chairman mentioned, I serve as the assistant director for the 

Secret Service Office of Investigations, overseeing our 161 offices. 

I also oversee our 42 cyber fraud task forces that are central to our 

criminal investigations. I also direct our National Computer 

Forensics Institute in Hoover, Alabama, which trains and equips 

local law enforcement, as well as prosecutors and judges. I thank 

you all for your recent support of our institute and reauthorizing 

it. 

For more than 150 years, the Secret Service has conducted criminal investigations to protect the American public and financial infrastructure from criminal exploitation. We continue to do so while 

also fulfilling our protective duties. After 21 years in Federal law 

enforcement, exploitation of government programs by criminals is 

not new to me. I often say the pandemic didn’t create any new 

criminals. It just provided more opportunities for them to exploit. 

Countering pandemic-related fraud has been our investigative priority since March 2020. In less than three years, we have opened 

thousands of investigations, recovered over $1 billion, arrested 

nearly 500 criminals, yet there is more work to do. It is our duty 

to detect and arrest criminals, seize their illicit assets, and disrupt 

their networks. Our experience in combating pandemic-related 

fraud reaffirms our investigative strategy. We continue to evolve 

our application of technology and training to develop skilled investigators, who can in turn combat emerging criminal tactics. 

We recognize the potential for fraud based on our experience following major disasters. Prior to the CARES Act enactment back in 

March 2020, we reached out to some natural partners to include 

the Offices of the Inspector General for the Small Business Administration, the Department of Labor, and the Council of the Inspector Generals on Integrity and Efficiency. We understood that many 

key partners had limited resources, and the best way to address 

the potential wave of fraud was to work together. We also worked 

with our longstanding partners in fighting financial crimes at the 
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Department of Justice, including U.S. attorney’s offices around the 

country, the Department of Treasury, FinCEN, and many others. 

The Secret Service is seeing the full spectrum of pandemic-related fraud. This included N–95 mask schemes, ransomware attacks targeting hospitals, the wide use of stolen identities, and inmates applying for benefits. Numerous cases also involved insiders 

with access to personal data. Criminals were prepared to exploit 

the pandemic, in part because for years they were selling identities 

stolen from past data breaches. They were also fabricating identities using personal and financial data to real people combined with 

false information. Our investigations also reveal that criminals 

used shell companies and false employment information. These tactics were repurposed for broad use during the pandemic. 

In closing, I will share some observations from our pandemic-related fraud investigative experience. The prevalence of identity 

theft and the volume of personal data assessable to criminals is undeniable. Continuing to improve identity verification standard for 

government funding programs is important. Advanced collaboration, as some of my colleagues mentioned earlier, between government entities and the financial sector is essential for mitigating 

fraud targeting government programs, especially during emergencies. Ensuring law enforcement are at the table would be a 

major step in curtailing fraud of this magnitude as well. Our cyber 

fraud task forces are a proven model for such collaboration in these 

task forces. Similarly, in our protective mission, we constantly communicate the importance of sharing information and planning for 

contingencies. 

Thank you again for the opportunity to testify today, and I am 

honored to represent the dedicated men and women of the Secret 

Service. I look forward to your questions. 

Chairman COMER. Thank you, Mr. Smith. Before we get to the 

questions, I am going to ask if you will stand and take the oath 

here. Do you all—raise your right hands? 

Do you all swear or affirm that the testimony you are about to 

give is the truth, the whole truth, and nothing but the truth, so 

help you God? 

[A chorus of ayes.] 

Chairman COMER. Let the record reflect the witnesses have all 

answered in the affirmative, and we want to thank you. 

Without objection, your written statements will be made part of 

the record. 

And before we move into the question portion, we have a lot of 

new members, a lot of freshmen that have never served in any 

committee in Congress, and I just wanted to make sure everyone 

knows the rules here. We will rotate back and forth five minutes. 

Please adhere to the five minutes. We are going to try to be strictly 

by the book. The order is determined by myself and Ranking Member Raskin. Please be respectful of everyone’s five minutes. I was 

telling some of the freshmen that during the 2017 session, my first 

full year in Congress, I was the very last person, dead last in seniority in the very far corner, and you appreciate when people don’t 

go over their time. But this is your time to ask anything you want, 

so please, to both sides, let’s be respectful of each member’s five 
11 

minutes. With that, I will begin questioning, and we will start with 

Mr. Horowitz. 

You mentioned the Do Not Pay list. Can you briefly tell us what 

that is? 

Mr. HOROWITZ. So, Treasury has set up a list of suspicious payees. It doesn’t mean they are not eligible. It doesn’t mean they can’t 

get benefits. It means that they are on a list that requires, at a 

minimum, secondary screening, secondary consideration, and evaluation. 

Chairman COMER. Was this used by government agencies to prevent fraud? So, this is a tool that I would assume would have been 

eligible in their toolbox. Let’s say the Small Business Administration or some agency that was doling out a lot of money really 

quickly, did they utilize the Do Not Pay list? 

Mr. HOROWITZ. They did not, and the issue there is we have 

heard over and over again, at the time, well, we needed to get the 

money out right away. There was an emergency. No dispute about 

that. We needed to get the money out right away. There was an 

emergency. It gets back to what the Comptroller General said. He 

needs to be ready for that. This list was sitting there. This was not 

anything that would have taken much time. There needs to be 

preparation. 

Chairman COMER. So, let me get this straight. The Do Not Pay 

list, I would assume that would be people that owe back taxes, people that maybe owe child support? 

Mr. HOROWITZ. There are a variety of reasons—— 

Chairman COMER. Convicted of fraud. 

Mr. HOROWITZ. Indicative of potential fraud, indicative of individuals who are in arrears in other payments. You can get on the list 

for a variety of reasons. 

Chairman COMER. So, how many people do we know received 

money from the Federal Government that were on the Do Not Pay 

list? 

Mr. HOROWITZ. I don’t know across all programs. What I do know 

is from the SBA’s PPP Program because almost $400 billion went 

out in two weeks—— 

Chairman COMER. Right. 

Mr. HOROWITZ [continuing]. In that program, of that amount, $57,000, $3.6 billion shouldn’t have gone out right away. I am not 

saying every one of those would have been denied, but at a minimum, there should have been secondary screening. 

Chairman COMER. So, what would be involved? What would this 

SBA had to have done, if we could go back in time, to ensure that 

people on the Do Not Pay list were flagged at least for further review? 

Mr. HOROWITZ. Well, frankly, interacting with the Treasury Department in advance to make sure that that screening was occurring, that data matching was occurring. 

Chairman COMER. Yes. Unbelievable. Mr. Dodaro, by the end of 

2020, Congress had already passed five laws containing more than 

$3 trillion in COVID relief funds. More than $1 trillion had been 

flagged by GAO as at-risk for waste, fraud, abuse. Inspectors general and law enforcement officials were already highlighting concerns about COVID relief money flowing to criminals and other in-
12 

eligible recipients instead of Americans in need, and the economy 

was improving. Nevertheless, Democrats insisted on $1.9 trillion 

more COVID relief spending through the American Rescue Plan 

Act, ARPA, putting those funds at risk and theft and the economy 

at risk of massive inflation and recession. So sir, did we lose funds 

included in the American Rescue Plan to fraud, and were additional improper payments made at the ARP after the ARP was 

passed? 

Mr. DODARO. Yes. I mean, the improper payments estimate, for 

example, for 2022 is the first year that the Paycheck Protection 

Program and the Economic Injury Disaster Loan Program made 

improper payment estimates. That was about $29 billion for PPP 

and about $7 billion, over $6 billion for the EIDL program. We had 

urged that those improper payments be made earlier in 2021, but 

they didn’t make those estimates then. 

Chairman COMER. Did you encourage Congress to do that? 

Mr. DODARO. No, the agencies. And my recommendations to the 

Agency—— 

Chairman COMER. What could Congress have done to have prevented this? 

Mr. DODARO. As one of my legislative recommendations from 

GAO is that any new programs over $100 million—not billion— 

$100 million, be designated immediately because of this past problem to be susceptible to improper payments and, therefore, make 

an estimate in the very first year of the program. Right now, the 

improper payments estimates only have to be made 2 or 3 years 

after a program has already started. It is too late. It is too late. 

And some of these temporary programs, they are all done. So Congress can and should have that as a requirement to be put in place. 

Chairman COMER. Well hopefully, that will be some kind of bipartisan legislative fix from this committee very soon. Mr. Horowitz, same question. I have got 40 seconds. What warning signs 

were there, and what should have been done? 

Mr. HOROWITZ. There were plenty of warning signs. Frankly, the 

urgency and speed to get it out without any consideration of what 

was already available to use, like Do Not Pay, as we did in our 

fraud alert this week, had there been agreements in place, they 

could have checked again. So, Security Administration, I think it 

is very important that consent-based verification tools be put in 

place for programs. What you need to know is whether the applicant is eligible. You can’t just self-certify, and they were relying on 

self-certification. 

Chairman COMER. Wow. Thank you. I am sure we will have 

many discussions moving forward, but my time has expired. I yield 

to the distinguished ranking member, Mr. Raskin, for five minutes. 

Mr. RASKIN. Mr. Chairman, thank you much. Mr. Horowitz, following up on that, when did the SBA start using the Do Not Pay 

program to check the eligibility of applicants for PPP loans? 

Mr. HOROWITZ. Following recommendations by SBA OIG, the 

PRAC, and GAO. They started in 2021. 

Mr. RASKIN. In January 2021, at the beginning of the Biden administration. 
13 

Mr. HOROWITZ. They said they were, and actually I am not sure 

who exactly started then. One of the issues has been getting them 

to implement. 

Mr. RASKIN. Yes. 

Mr. HOROWITZ [continuing]. Statement, what they said, but they 

did make efforts to start, and they did subsequently start doing 

that. 

Mr. RASKIN. Great. Well, when we passed the CARES Act in 

2020 and we created the Pandemic Response Accountability Committee, which you lead, the CARES Act included specific language 

directing the PRAC to create a user-friendly website—— 

Mr. HOROWITZ. Right. 

Mr. RASKIN [continuing]. To give the American people an overview of how pandemic relief funds were being spent all the way 

down to the project, community level. But guidance released on 

April 10, 2020, by President Trump, made it nearly impossible to 

effectively track pandemic relief funding past the first distribution. 

And, Mr. Chairman, I would want to ask unanimous consent to insert the administration’s April 10, 2020, guidance into the record. 

Chairman COMER. Without objection. 

Mr. RASKIN. So, Mr. Horowitz, how did this guidance affect the 

PRAC’s ability to identify and prevent pandemic relief fraud? 

Mr. HOROWITZ. So, in the CARES Act, Congress said that the 

PRAC needed to launch a website within 30 days. We did. Go to 

pandemicoversight.gov, you can see how the money has been spent. 

You can get to your local zip code if you would like. We were challenged at the outset because OMB leadership decided to use what 

was already existing, reporting tools in USAspending.gov, which we 

did not believe was sufficient, GAO did not believe was sufficient, 

and SBA, and others IGs didn’t believe was sufficient to meet the 

requirements of the CARES Act. 

The memorandum that went out that you mentioned put that in 

place, and it limited our ability at the outset to get the data we 

needed. For folks who followed our website from 2020 forward, you 

will see gradual additions to the website. Indeed, SBA wouldn’t 

give us the information. This was an SBA agency issue until September or October 2020. We couldn’t get much of any data from 

them because they were litigating FOIA lawsuits. 

Mr. RASKIN. Got you. So, do you think that that guidance met 

the language and the spirit of the CARES Act requirements for 

tracking pandemic relief spending all the way to the ground? 

Mr. HOROWITZ. The public should know where money went. Congress needs to know where money went. You can’t figure out 

whether a policy worked, whether it has been defrauded, who is accountable if you don’t know where the money went. 

Mr. RASKIN. Mr. Dodaro, following the 2008 financial crisis, 

President Obama signed the American Recovery and Reinvestment 

Act to stimulate the economy and to get us out of the Great Recession. I think that was a $787 billion program if memory serves. Do 

you think that that Trump administration 2020 guidance we are 

talking about effectively incorporated lessons that were learned 

from Obama’s successful implementation of the American Recovery 

and Reinvestment Act? 
14 

Mr. DODARO. Not to the full extent that they should have been. 

The Recovery Act reporting required reporting from recipients, and 

the Recovery Act Board created that, so you had much more timely 

reporting than what you had under the guidance that Mr. Horowitz 

just talked about, which is using USAspending.gov. So, they could 

have taken some of those lessons, I think, and so—— 

Mr. RASKIN. Got you. So Mr. Horowitz, then did you at all express your frustration with this undermining of the CARES Act determination that the public have complete accountability and 

transparency? 

Mr. HOROWITZ. At the time, PRAC leadership was meeting with 

OMB and expressing the need to have better reporting portals than 

what existed with USAspending. There are many issues with 

USAspending. IGs have written about those that need to be fixed. 

GAO has written report after report about that. Those need to be 

fixed. If you want to find the best information that is out there, it 

is actually for the Coronavirus Relief Fund, which was the $150 

billion in the CARES Act that went to the states. The reason that 

is there, that information there is because the Treasury IG, working with the PRAC, created the Recipient Reporting Portal. We 

couldn’t do that. It cost us money. They cost them money. We 

couldn’t do that for, you know, trillions of dollars, but that is what 

needs to be done. 

Mr. RASKIN. Well, I am proud that we included those provisions 

in the CARES Act precisely to ferret out fraud, to try to prevent 

the waste and abuse. But it obviously requires leadership at the 

Presidential level, at the very top, a commitment to making sure 

that everything is accountable and transparent. Thank you, Mr. 

Chairman. I yield back. 

Chairman COMER. The chair recognizes Mr. Gosar for five minutes. 

Mr. GOSAR. Thank you. Good seeing you, gentlemen. It is a 

pleasure to see you this morning. You bring up mandated regular 

reporting aspects, is a big key, and Congress has dictated a lot to 

you, but Congress hasn’t done their fair share either. So, when you 

look at the National Emergencies Act, there is a requirement that 

the Congress meet every six months to have a detailed report instead of a synopsizing all this all over a year or a year-and-a-half. 

It would be better to have these numbers on a basis over six 

months, having account of it. Would you agree with me, Mr. Horowitz? 

Mr. HOROWITZ. Yes. I think more regular reporting would be 

helpful, and part of that is getting the data information from agencies to the public to Congress in a timely fashion, yes. 

Mr. GOSAR. So, do you agree with that, Mr. Dodaro? 

Mr. DODARO. Absolutely. Absolutely. 

Mr. GOSAR. Part of the National Emergencies Act— that actually 

Congress must, shall convene to look at these expenditures and to 

have some rein over it. I think that part of our purview is the 

power of the purse. So, if you are not having accountability to this 

body, to this Congress, you are lacking in your jurisdiction of oversight. I guess, having said that, looking at what we have seen in 

this gobbledygook of national emergencies— date back, that are 
15 

open to the 1970’s. I don’t know how you figure these numbers out. 

I mean, it is crazy. I just don’t know how this works. 

So my question is, to the American taxpayer, there are estimates of $560 billion of fraud in the COVID–19 funds. Do you agree with 

that, Mr. Dodaro? 

Mr. DODARO. It will be a while before the full extent of fraud is 

known. 

Mr. GOSAR. Right. 

Mr. DODARO. As I mentioned in my statement, you know, there 

has been over 1,000 people have pled guilty or been convicted. 

There are over 600 charges still pending against people. The SBA 

IG has 536 active investigations right now. The Department of 

Labor IG is opening up 100 new cases every week. So, this is going 

to go on for a while. There are definitely indications of widespread 

fraud, but it is impossible to estimate right now what the full extent will be. Time will have to unfold, and these investigations will 

have to be undertaken because the definition of ‘‘fraud’’ is willful 

misrepresentation to get something of value that is adjudicated 

through a court or some other judicial process. 

Mr. GOSAR. Would you agree that continued reporting would be 

better, you know, a timely reporting to the jurisdictional committee 

like this one or Transportation? In regards to the amount of fraud, 

the number of fraud, what can Congress do to allocate, you know, 

more streamlining in this process? Do you see a process that we 

can go forward with that? 

Mr. DODARO. Yes. I mean, there is a regular process for the inspector generals to report semiannually, but when you have extraordinary circumstances like we have, there could be more frequent reporting in those cases. But there are definitely benefits of 

having more frequent interaction and oversight by Congress with 

oversight bodies, the GAO and the Inspector Generals in this case, 

the Secret Service, because some of these legislative solutions that 

I have recommended could have been taken a lot earlier in the 

process. 

Mr. GOSAR. And so, if we are rewriting the National Emergencies 

Act, would you be able to give us your inferences as to how to detail the changes? 

Mr. DODARO. I will be happy to look at the act and make suggestions, yes. 

Mr. GOSAR. OK. How about you, Mr. Horowitz? I mean, you always come up with great ideas. 

Mr. HOROWITZ. Yes, absolutely. I would be happy to. 

Mr. GOSAR. To Mr. Smith, do you see any aspects of—particularly, from the Secret Service, where we can make some amends 

within the National Emergency Act? 

Mr. SMITH. Thank you for the question, sir. As I mentioned in 

my opening, similar to our protective mission, which our brand is 

largely associated with, one of the central tenets of our mission is 

advance work. And, as some of the co-panelists spoke about earlier, 

our cyber fraud task forces or our task force, incorporating private 

sector, incorporating academia. And what we do is share information on a continual basis, so we don’t wait until the President 

shows up in a district to establish relationships. We do that prior 

to that time. So similarly, in our investigative mission, we know 
16 

that it is important to maintain relationships with financial institutions, academia, in order to get in front of fraud and share ideas 

because we have a constant cadence of interacting with bad guys 

in the context of our jobs. 

Mr. GOSAR. Thank you. I might run out of time. I yield back. 

Chairman COMER. The chair recognizes Mr. Lynch for five minutes. 

Mr. LYNCH. Thank you, Mr. Chairman, and the ranking member 

for holding this hearing, and I want to thank our panelists for your 

good work. I recognize you from previous hearings, and thank you 

again. 

This was a difficult challenge from the very beginning, and I just 

want to take us back to the Trump administration’s initial response. So, back in 2019 and 2020, Mr. Trump, on January 24, 

2020, the day the second coronavirus virus case was confirmed in 

the United States, President Trump tweeted and again reiterated 

that, ‘‘China has been working very hard to contain the 

coronavirus. It will all work out. I want to thank President Xi,’’ and 

then went on to say that the coronavirus would be over by Easter. 

Based on what we know now, did those statements by the President of the United States induce the sense of urgency that the 

American people should have harbored with respect to this pandemic, Mr. Dodaro? 

Mr. DODARO. I think that the actions that the Congress take 

shows a sense of urgency in passing the CARES Act back in March 

2020, on a bipartisan basis, and I think that sent the right signal 

and a sense of urgency that needed to be addressed to those issues. 

Mr. LYNCH. You are exceedingly diplomatic as always. 

Mr. DODARO. That is why I am still here. 

Mr. LYNCH. Mr. Horowitz and Mr. Smith, you want to take a 

crack at that question? 

Mr. HOROWITZ. Not particularly. 

Mr. LYNCH. Well, let me just get down into the details a little 

bit here, unless Mr. Smith, you would like to add? No. OK. I am 

not sure of the division of labor within your agencies, but are any 

of you familiar with the Yellow Corporation during your investigations? No? 

Mr. DODARO. Sorry, which corporation? 

Mr. LYNCH. Yellow Corporation. It was a trucking company apparently with political connections to the Trump administration. 

Are you familiar with that? 

Mr. DODARO. I think that is the one that there was a loan given 

to out of one of the programs, and I think we—— 

Mr. LYNCH. Correct. Let me refresh. Let me try to—— 

Mr. DODARO. We looked at that issue. 

Mr. LYNCH. OK. Yes. 

Mr. DODARO. We looked at that. 

Mr. LYNCH. All right. Thank you. Let me try to refresh your 

recollection. So, the Select Subcommittee report confirmed that a 

$700 million loan to this trucking company that was politically connected to the Trump administration was given this $700 million 

loan, and Trump administration political appointees overruled Defense Department officials in that case to actually certify the company, as ‘‘critical to maintaining national security and, therefore, 
17 

eligible for the loan.’’ The company then went on to use the loan 

for long-term capital investments in violation of the CARES Act requirement. I was just curious. I know you are familiar with it. Do 

you have anything else you could add to that fact pattern? 

Mr. DODARO. I would be happy to provide our results for the 

record. I can’t remember offhand, and I don’t want to misstate. 

Mr. LYNCH. OK. All right. Well, we could take that at a later 

time. 

Mr. LYNCH. What are the lessons learned based on how the 

Trump administration responded initially to the pandemic? 

Mr. DODARO. No. 1, I think there should have been more preparedness on the part of the agencies to prevent fraud. You know, 

Congress passed legislation in 2016 based on GAO’s advice on how 

to prevent fraud in the first place. Part of this is there is a cultural 

problem. In most cases, the fraud issues, people think of the inspector generals and think of the Secret Service and GAO, but you 

got to prevent it in the first place, but the agencies were slow to 

implement it. 

Mr. LYNCH. Yes. 

Mr. DODARO. The OMB was supposed to create a working group 

to develop this. We issued a report in 2019, said the working group 

had never met, that it needed to take more actions, No. 1. No. 2, 

I think the other lesson learned for the Congress is to be careful 

about putting provisions in the legislation that make programs 

more susceptible to fraud, allowing, for example, the self-certifications, not using tax credit transcripts, rather, so I think there is 

legislation there as well. Third, the agencies that had not addressed improper payment problems, they know they have payment 

problems, and not addressing open GAO and IG recommendations 

make them less prepared. So, there are a lot of lessons and my legislative solutions to these address some of these lessons learned. 

Mr. LYNCH. Thank you, Mr. Chairman. My time has expired, and 

I yield back. 

Chairman COMER. The chair now recognizes Dr. Foxx for five 

minutes. 

Ms. FOXX. Thank you very much, Mr. Chairman, and I thank you 

for holding the hearing. Well, I have no questions for Mr. Dodaro, 

but I do want to thank him so much for the work he and his team 

do on behalf of the American people in helping us figure out ways 

to be more efficient and find the waste, fraud, and abuse, and I appreciate your comments just now. 

Since coming to Congress, I have fought for transparency and accountability in Federal spending, and with trillions of dollars of 

COVID aid spent over such a short period of time, it is imperative 

we closely watch where and how that money was spent, and I 

think you have given us some more ideas. It is likely something we 

are going to have to track for a long time. But Mr. Horowitz, I have 

questions for you. Can you speak to the need for the Pandemic Response Accountability Committee, or PRAC is and its importance? 

Mr. HOROWITZ. Thank you, Congresswoman. I think it was critical for Congress to set up the PRAC when the CARES Act was 

passed. At the time, we were asked to oversee $2 trillion. It is now 

$5 trillion of pandemic oversight. And what it did was it brought 

the inspector general community together to coordinate oversight. 
18 

We created a data analytics platform to do the kind of work that 

resulted in our fraud alert last week, and you gave us hiring authority to bring on great data scientists, a great team that has enabled us to do this work. We got it up and running, and we moved 

forward. And as a result, we have been able to coordinate more 

closely with not only our IG partners, but with the GAO. And with 

state and local auditors, we created a state Auditor-in-Residence 

Program. We have two auditors from the state of Tennessee who 

have come on board recently. First ever that has been done in the 

IG community because we want to coordinate with our counterparts and our oversight partners at the state and local level. And 

so, we have brought together people in a way that we have never 

had before in the IG community. 

Ms. FOXX. So in your work, how would you rate, with the PRAC, 

the various COVID relief funding programs from most to least susceptible to improper payments? 

Mr. HOROWITZ. Well, I think what you have seen so far is the 

three of the biggest programs: the Paycheck Protection Program, 

the Economic Injury Disaster Loan Program, and the Unemployment Insurance Program. Those three programs, which by the way, 

account for just under $2 trillion of the spending, have shown to 

be highly susceptible to fraud for different reasons. PPP—— 

Ms. FOXX. Can you give us the characteristics that cause that? 

Mr. HOROWITZ. Yes. So, for PPP and EIDL, those were administered at the Federal level. And the problem there was the desire 

to simply get the money out as quickly as possible, without taking, 

not an unreasonable amount of time, but an appropriate amount of 

time to make sure that they were sending the money to the right 

people. That was the problem, among others, with those two programs. On the unemployment insurance, the issue was different 

because that is administered by the 50 states. The problem there 

is the lack of coordination among them and with the Labor Department, and the Labor IG has written extensively about that problem. 

Ms. FOXX. So, we have some recommendations on what to do in 

that area. 

Mr. HOROWITZ. A number of recommendations. 

Ms. FOXX. Good. 

Mr. HOROWITZ. And I would be happy to send them up to you. 

Ms. FOXX. Absolutely. Since the Labor Department is in the jurisdiction of the Education and Workforce Committee, I am anxious 

to see those. 

Ms. FOXX. So, you charged 47 defendants in a $250 million fraud 

scheme involving a Minnesota nonprofit, Feeding Our Future, one 

of the largest COVID aid-related frauds uncovered. What, if any, 

indicators, were there of this sort of fraud, and could it have been 

stopped earlier? 

Mr. HOROWITZ. So, it is always hard to say whether something 

could be stopped earlier. We want to obviously be careful in hindsight to say that. But had there been on these various programs, 

a preclearing or a prereview of an applicant, first of all, whether 

it was a legal entity. Did it really exist? Was the email address 

coming from overseas? Was it from an IP address, I mean, coming 

from overseas? As we just reported on, did names, date of birth, 
19 

and Social Security numbers match what is in SSA’s—Social Security Administration’s—records? That is an easy check. Were they 

on a Do Not Pay list? There were multiple steps that could have 

been taken in many of these instances. They could have, at a minimum, paused, hit the pause button, take a second look to make 

sure they are eligible. 

Ms. FOXX. Mr. Chairman, I know my time is up, but I would like 

to make one quick comment. I am really concerned about what Mr. 

Horowitz said about the 2016 bill being passed on how to prevent 

fraud, and the agencies were slow to implement. We have got to 

get to the root of these kinds of things, and say to these agencies, 

and fire people if they don’t do things they are supposed to do. 

That is our biggest problem in the Federal Government. Nobody 

can be held accountable. Thank you. I yield back. 

Chairman COMER. Thank you. The chair recognizes Mr. 

Krishnamoorthi. 

Mr. KRISHNAMOORTHI. Thank you, Mr. Chairman. Mr. Smith, I 

want to ask you about your ongoing investigations involving 

transnational criminal actors defrauding our pandemic relief programs. It looks like in a statement that the Secret Service put out 

in December, you talked about a group called APT 41. Are you familiar with that? 

Mr. SMITH. Yes, sir. 

Mr. KRISHNAMOORTHI. And it says in your statement, APT 41 is 

a ‘‘Chinese state-sponsored cyberthreat group that is highly adept 

at conducting espionage missions and financial crimes for personal 

gain.’’ Are you familiar with that? 

Mr. SMITH. I am familiar with the article, sir. Yes, sir. 

Mr. KRISHNAMOORTHI. And apparently, according to this same 

article, this group, the APT 41, Chinese state-sponsored cyber 

gang, stole tens of millions of dollars in U.S. COVID Relief benefits, 

including SBA loans, unemployment insurance funds, in over a 

dozen states. Isn’t that right? 

Mr. SMITH. That is what the article stated, yes, sir. 

Mr. KRISHNAMOORTHI. Now, tell me, sir, since that article came 

out, I got to believe that they have probably targeted a lot of states 

beyond a dozen. Can you tell us how widespread the geographic 

coverage was in terms of the number of states that they had tried 

to target? 

Mr. SMITH. So again, I am familiar with the article. Our national 

pandemic fraud coordinator, who testified last summer, who I appointed to that position, was a supervisor in one of our field offices, 

the spirit of what he was conveying was that it is unimaginable 

that organized transnational criminal organized groups did not 

look to exploit pandemic-related fraud no different than, you know, 

an American would. There are some commonalities between some 

of the thousands of bank accounts that we have seen used to move 

illicitly gained pandemic fraud resources that were also being used 

by some of those transnational criminal organized groups, to include the one you mentioned. It is also worth mentioning when we 

do have cases that involve transnational criminal organized groups 

or state-sponsored entities, we do—— 

Mr. KRISHNAMOORTHI. Let me stop you there. OK. We have now 

established APT 41 is a Chinese state-sponsored cyber gang. Now, 
20 

let me just turn your attention to Russia. Have we identified any 

Russian state-sponsored cyber gangs involved in pandemic fraud? 

Mr. SMITH. A lot of the Russian underlying pandemic-related 

fraud has to do with folks dealing in identity theft. So, for decades, 

we have known forums wherein people that deal with—— 

Mr. KRISHNAMOORTHI. State sponsored, though. Are they state 

sponsored? 

Mr. SMITH. Sir, the Secret Service focuses on financial crimes. 

Whether or not an entity is state sponsored or not is generally not 

why we tend to focus on them. We follow money, and if that leads 

us to a state-sponsored actor, we don’t stop the case, but we then 

employ our partners at DOJ. 

Mr. KRISHNAMOORTHI. And have you come across that link yet, 

in other words, that required a referral to DOJ? 

Mr. SMITH. That referral to DOJ is actually part of the task force 

the DOJ started at the beginning of the pandemic. So, there are 

cases wherein we have some linkages or commonalities between 

cases we are working for financial crime reasons, and there may 

be a state sponsor act that has some commonalities there. 

Mr. KRISHNAMOORTHI. OK. So, now we have established that 

there have been Chinese state-sponsored cyber gangs as well as 

Russian state-sponsored linked to the state individuals who have 

committed pandemic relief crimes? 

Mr. SMITH. Sir, what I said was that there are commonalities between some of the accounts and other indicators we have seen. 

That is what I said. 

Mr. KRISHNAMOORTHI. OK. Now with regard to APT 41, in particular, in your statement—I am sorry, the U.S. Secret Service’s 

statement. 

Mr. SMITH. Yes, sir. 

Mr. KRISHNAMOORTHI. It said it was ‘‘state-sponsored’’. Now, 

have you been able to identify any evidence that the Chinese Communist Party ordered or asked this particular cyber gang to commit 

this fraud, or do we have evidence that they just merely looked the 

other way and permitted them, knowing them to have committed 

this fraud? 

Mr. SMITH. Sir, I have no evidence as to what the Chinese Government ordered a transnational criminal organized entity to do. 

Mr. KRISHNAMOORTHI. Are there any other cyber gangs, state 

sponsored, either Chinese or Russian or any other state-sponsored 

criminal gangs that have committed pandemic fraud? 

Mr. SMITH. Sir, just last year, we disrupted a transnational 

criminal organized group known as Black Axe. They are Nigerian 

based. They are operating in South Africa, and they have a longstanding history of committing a lot of different types of fraud, and 

they use a lot of the pre-existing money mules. There is an extensive money mule network that operates here in the states. Again, 

even the transnational criminal organized groups overwhelmingly 

used or leveraged an American or an American profile to facilitate 

pandemic-related fraud. So, we did see that and we had an operation that disrupted that group just last year. 

Mr. KRISHNAMOORTHI. Thank you. 

Chairman COMER. The chair recognizes Mr. Grothman for five 

minutes. 
21 

Mr. GROTHMAN. Sure. A few more questions, follow-up questions 

for Mr. Smith. Could you give me a little more information as far 

as a stereotype, as far as fraud being committed by people abroad, 

or fraud being committed by immigrants? 

Mr. SMITH. What was the last word, fraud being committed by 

who, second part? 

Mr. GROTHMAN. Immigrants. Immigrants. Immigrants. 

Mr. SMITH. So, I am not going to get into stereotypes. We follow 

money. We follow evidence. And at the end of the day, as I mentioned to the previous committee member, the majority of the cases 

we have seen, even if there is a criminal looking to exploit pandemic-related fraud abroad, they use an American mule. We had 

certain campaigns that are cyber fraud task forces communicated 

to don’t be a money mule, whether witting or unwitting, because 

what we saw was a lot of Americans being utilized to move money 

abroad because the criminals didn’t know that overwhelmingly 

what we were looking for were, you know, American bank accounts, 

American identities to issue money to. So, they use that and leverage an extensive network of money mules that preside overwhelmingly here in the United States to get that money into their hands. 

Mr. GROTHMAN. Well, there would be an example. Is the mule in 

America? Are they have contacts within the foreign nations? I 

mean, are they immigrants from the foreign nations? Are you just 

grabbing a random person off the street? I mean, could you comment on these mules? 

Mr. SMITH. So we have, you know, dozens of cases, hundreds of 

cases where, you know, we would have a person in ‘‘fill in the 

blank’’ state. One state comes to mind where there was a mule that 

had literally funneled $12 million to some criminals that resided 

abroad. And once we start following the money, once we start looking at some of the commonalities and bank accounts, and we have 

an opportunity to go interview a person—— 

Mr. GROTHMAN. Right. Could you tell me what those countries 

were abroad, and could you tell me the background of the mules 

here, where did they have connections to the country abroad? 

Mr. SMITH. So, one of the cases, as I mentioned a second ago, 

was out of South Africa, focused on some Nigerian individuals in 

a group called Black Axe. That case I just mentioned with the $12 

million was one of the cases where in a money mule sent money 

to accounts that were operated by Black Axe. And I want to impress upon the group here, money mules are not a new concept. 

Like, there is an extensive network. 

Mr. GROTHMAN. Right. You are not answering my question. 

Mr. SMITH. Sir. 

Mr. GROTHMAN. Presumably, they got these mules somewhere, 

OK? You mentioned Nigeria. You mentioned South Africa, where 

the people who did the work in America connected in those countries in any way. Were they immigrants from those countries? 

Were they just random people they find on the internet? Were the 

immigrants from those countries? 

Mr. SMITH. Not necessarily, sir. 

Mr. GROTHMAN. I know not necessarily, but does it happen, and 

how often does it happen? 
22 

Mr. SMITH. Overwhelmingly, in our experience, that does not 

happen. Criminals just take advantage of folks looking to make a 

quick buck, and the pandemic offered that opportunity with the 

amount of resources that were made available. 

Mr. GROTHMAN. OK. Now in general, Mr. Horowitz, I can think 

of flaws in these programs that the fraud would be almost predictable. But can you tell us, in the future, what things we can do in 

programs so the fraud is not committed so easily? 

Mr. HOROWITZ. So, I think one of the easiest things to do that 

wasn’t done is to prepare, as the Comptroller General said, by employing verification tools, identity verification tools. The amount of 

identity theft was extraordinary here, and it needs to be addressed 

because we are not only talking about when that occurs, theft from 

a government program, theft from the taxpayers, but for anybody 

who has been on the receiving end of having their identity stolen, 

you understand how you are victimized in that way. And just in 

the fraud alert, we indicated we now have 200,000 social security 

numbers that were used that we need to follow up on to see if those 

individuals’ identities were stolen. 

Mr. GROTHMAN. So, in other words, the money is going to, it is 

going to an account or something other than the person who is 

committing the fraud? 

Mr. HOROWITZ. Correct. So, what is happening is individuals are 

claiming that they are the person whose name is on the application, whose date of birth is on the application, and or whose social 

security number is on the application. When we checked and went 

to Social Security Administration to ask them to verify it, a check 

they can do. We entered into that. They were doing large-scale 

verification for us. They came back and said those don’t all match 

for those 212,000 numbers, which means in some instances, it 

could be a false positive. Somebody could have transposed their social security number down or their date of birth down, so there are 

going to be some of those. But presumably, for most of them, those 

are individuals who obtained, on the dark web through other 

means, social security numbers that were previously stolen from individuals and had their identity stolen. 

Mr. GROTHMAN. And then they wind up going to a bank account 

that has this person’s name on it, but this person doesn’t even 

know the bank account. 

Chairman COMER. The gentleman’s time has expired, but we will 

let you finish the question. 

Mr. HOROWITZ. Yes, certainly there is an ability to go to the 

bank, particularly if, as with the PPP Program, the Agency has 

said you don’t need to do anything other than accept the person’s 

verification that it is them. In other words, all that had to happen 

in the PPP Program at the outset was you went to the lender, you 

signed an application saying, no, I am really this person, and they 

accepted it. No one can walk into a bank today and get a loan and 

say, no, no, really, I am this person, give me the money, but that 

is what was going on. 

Chairman COMER. Chair recognizes Ms. Norton. 

Ms. NORTON. Thank you, Mr. Chairman. Mr. Horowitz, this question is for you. Democrats provided the Department of Labor inspector general $25 million in the American Rescue Plan to combat 
23 

fraud and corruption in the process. Also in the American Rescue 

Plan, Democrats made critical investments in fraud prevention and 

accountability, including providing more than $200 million in funding for watchdogs to investigate fraud, waste, and abuse as well as 

$2 billion to support states’ modernization of unemployment insurance systems to reduce fraud vulnerabilities. The Biden administration has begun using these funds to support state efforts to 

make unemployment insurance systems both more accessible to eligible recipients and less susceptible to fraud. The American Rescue 

Plan provided significant funding to the pandemic recovery accountability committee as well. Yet my Republican colleagues voted 

against these commonsense measures to reduce fraud. 

When the American Rescue Plan became law, Mr. Horowitz, you 

released the following statement, and here I am quoting you, ‘‘The 

enactment of the American Rescue Plan adds to the important 

independent oversight responsibilities of the PRAC and its member 

inspector generals. We appreciate the ongoing support from Congress and the administration of the PRAC in and its oversight mission.’’ Mr. Horowitz, how much funding did the PRAC receive in 

the American Rescue Plan to perform the vital oversight functions? 

Mr. HOROWITZ. In the ARP, in the American Rescue Plan, the 

PRAC received $40 million of funding. 

Ms. NORTON. Now, Mr. Horowitz and Mr. Dodaro, what other resources and authorities do you need to continue your work? 

Mr. HOROWITZ. So, as I mentioned in my written statement at 

the outset, I think very important to continue the data analytics 

platform that $40 million that was in the American Rescue Plan 

covered our ability to start the data analytics platform we have in 

2021. It is funded through 2025, but we sunset on September 30, 

2025. We turn the key off at that point unless it is extended. Congress invested $40 million to fund that over four-and-a-half years. That is $15 million, $16 million we are spending right now. 

Just the fraud alert alone this past week, we identified $5.4 billion 

of potential fraud. That is 360 times the amount of money that we 

spent this year, or spending this year, to run our data analytics 

platform. In other words, it would take us 360 years of spending 

at that number to add up to $5.4 billion, so that, I think, is very 

critical. 

Mr. DODARO. I would agree. I want to throw my support behind 

the establishment of this platform, a data analytics platform. Right 

now, it only applies to pandemic spending, and it is going to expire. 

This happened back after the Recovery Act, as I mentioned in my 

opening statement, and it was a very effective process then, but it 

expired in 2015. Now, if it had been in place at the beginning when 

the CARES Act was passed in 2020, I think we could have saved 

a lot of money and prevented fraud or went after it earlier. But it 

wasn’t established until the American Rescue Plan in 2021, so by 

that point, hundreds of billions of dollars have been already spent. 

So, I think this is a prudent investment on the part of the Federal 

Government to have this capability in the IG community on an ongoing basis. It will more than pay for itself many times over. 

Ms. NORTON. In addition to the funding, Democrats included 

funding to the American Rescue Plan to provide grants to states to 

engage their local community organizations that represent those el-
24 

igible for benefits. The goal is to help states learn how to more effectively reach these traditionally underrepresented and underresourced communities. So, may I ask you, Mr. Horowitz and Mr. 

Dodaro, will these types of investments in the community engagement help you separate paperwork errors, other unintentional mistakes, and actual fraud? 

Mr. DODARO. I think it is important to recognize, and we have 

ongoing work. So, we are going to be looking at that issue to see 

how effective Labor is working with the states and with those entities, so that is very important. Today, we focused a lot on the fraud 

part of the Unemployment Insurance Program, but on the benefit 

side, there was lack of timely benefits that were given to people. 

We find also some disparities in terms of how different people, different races have been treated. So, there is a lot to be done in unemployment insurance area to make sure there are timely payments made to the proper people in a balanced, equitable fashion, 

whilst stopping fraud on the other area. 

Now, we have added the Unemployment Insurance Program, 

along with the PPP, and Economic Injury Disaster Loan Program 

to the list of high-risk areas across Federal Government. The unemployment insurance area is badly in need of transformation, not 

only in dealing with these community organizations, but the IT 

systems in the states are terribly antiquated and not capable of 

executing this type of program in the future until they are modernized. 

Chairman COMER. Thank you. The chair recognizes Mr. Palmer. 

Mr. PALMER. Thank you, Mr. Chairman, and I thank the witnesses. To date, do we know the full amount of improper payments 

of COVID funds, Mr. Dodaro? 

Mr. DODARO. There are estimates that have been made on the 

unemployment insurance area. In 2020, the estimate was improper 

payments was $78 billion, up from about $9 billion in 2020. And 

then there was another $18.9 billion of improper payments reported by unemployment insurance program for 2022, and that was 

a 22 percent error rate, and the year before was 18.9 percent error 

rate. Prior to the pandemic, it was about nine percent, and the PPP 

and EIDL areas combined is about $36 billion. 

Mr. PALMER. We are talking $135 billion. I have done math in 

my head. 

Mr. DODARO. Yes. 

Mr. PALMER. As you know I like to do. 

Mr. DODARO. Yes, I do. 

Mr. PALMER. It appears to me that some Federal agencies might 

not have been as forthcoming with information as both you and Mr. 

Horowitz would have needed. The Small Business Administration 

potentially violated Federal law by failing to respond to the GAO’s 

requests. Has that been the case that they have not responded to 

your request? 

Mr. DODARO. It was early on in the start of the programs. It has 

gotten much better and I actually had to go back in 2020 and 2021. 

I testified before the Coronavirus Select Committee, and I had 

called the chair and ranking members of this Small Business Committees, both the authorizers and the appropriators, to get help. I 

mean, we couldn’t get any information on SBA at all, and it wasn’t 
25 

until later, there was a lawsuit where they had to then disclose the 

amounts of loans. Now it has gotten better. 

Mr. PALMER. One of the problems is that the unemployment insurance programs authorized under the CARES Act were excluded 

from the program’s total reported improper payments because they 

were not in existence for more than 12 months, and these programs 

represented about 70 percent of the unemployment payments in 

2020. Should Congress consider legislation reform, the improper 

payments reporting periods in order to more accurately track the 

COVID relief funds in the future if we have to have this again? 

Mr. DODARO. Yes, absolutely, and that is one of my legislative 

recommendations. 

Mr. PALMER. I would appreciate, and I have enjoyed working 

with both you and Mr. Horowitz over the years on things like this, 

if you would provide to me in writing your recommendations for 

legislative fixes. 

Mr. PALMER. I want to move to something else. It has been discussed about what actions Republicans took, and I just want to ask 

you, if we had required two-factor identification for online applications or provided state unemployment agencies by fax/email or 

other means, or transmission, a copy of the claimant’s state ID, if 

we had utilized protocols to prohibit applications from foreign IP 

addresses, if we denied claimants using virtual private network 

identification, require individuals—I could go down this whole list 

of things—would that have helped reduce the amount of fraud? 

Mr. DODARO. Yes. 

Mr. PALMER. Well, I just want to point out, Mr. Chairman, that 

these are recommendations that were made by Republicans in the 

House and Senate, including myself. I introduced a bill to do this 

that were largely ignored. When we began to see the massive 

amount of fraud as early as, I think, April/May 2020, Mr. Horowitz, 

I think, and working with the Department of Labor, the Office of 

Inspector General there, that billions of dollars had already gone 

out, and we couldn’t get these guardrails back in, would that have 

helped, Mr. Horowitz? 

Mr. HOROWITZ. Absolutely, and the fraud did start right off the bat. I mean, for the PPP Program sent out $400 billion in two 

weeks. 

Mr. PALMER. Let me ask one other question. What we have seen 

toward in the last few months here is states using their COVID relief funds for things like New Jersey, $50 million in state and local 

fiscal recovery funds to bolster the state’s bid to host the 2026 

World Cup. We saw the state of Washington sent out $128 million 

in 1,000 payments to 120,000 illegal immigrants. We saw Colorado 

Springs use $6.6 million to put an irrigation system at two local 

golf courses, $5 million dollar state of Massachusetts pay off debts 

incurred by Edward M. Kennedy Institute for the U.S. Senate in 

Boston. Are any of those improper uses of funds? I mean, I know 

we wanted to give them flexibility, but isn’t that a little bit out of 

the box? 

Mr. DODARO. Yes. Well, there are broad uses authorized in the 

legislation for that money. We are looking at it right now, and so 

we will try to identify those areas that may be out of bounds legally. But it reminds me that the Recovery Act, when there was a 
26 

lot of questions about the use of the money, whether that was appropriate or not, when it was really, you know, legally authorized 

because the government gave great flexibility to the state and local 

community to make decisions. The other issue you had to deal with 

always at the state and local level was fungibility of the money. 

Mr. PALMER. Well, they didn’t have that early on, and Mr. Chairman, I think this might be something we want to look into because 

it is not just the fraud. It is the improper use of some of the funds. 

And my time has expired. I always enjoy hearing from you guys. 

I yield back. 

Chairman COMER. Absolutely. The chair recognizes Ms. OcasioCortez. 

Ms. OCASIO-CORTEZ. Thank you so much, Mr. Chairman. This 

hearing is called Federal Pandemic Spending: A Prescription for 

Waste, Fraud and Abuse, UI, unemployment assistance, the Paycheck Protection Program, all of it. And in the wind-up to this 

hearing, on January 13, I see that the chair sent several letters to 

three states—Pennsylvania, California, and my home state of New 

York—with serious allegations of widespread fraud and abuse. But 

I am curious a little bit about how we got to these three states. Mr. 

Dodaro, if you were auditing or investigating what went wrong in 

states in the distribution of pandemic-related unemployment insurance, how would you go about choosing which states to examine? 

Mr. DODARO. Well, we would look at a number of factors. One 

would be the amount of money that would go there. We would look 

for geographic distribution of the programs. We would look for 

other characteristics of state programs, a number of claims, for example, that have been there. And so, we would take a nationwide 

sample. 

Ms. OCASIO-CORTEZ. And even, you know, in your experience, 

looking at perhaps even something like a per capita approach, or 

you know, in your expertise, if you had to estimate some of the top 

candidate states, what do you think some of those states would be 

and why, and, again, more on like a per capita level? 

Mr. DODARO. Yes, I don’t have the per capita numbers in my 

head, so I don’t want to venture a guess at this point. I would be 

happy to provide something for the record. 

Ms. OCASIO-CORTEZ. Overall, let’s say not from per capita. What 

would be some of the top states that you would look at in terms 

of your experience and oversight of these programs? 

Mr. DODARO. Well, certainly California and New York are always 

candidates to look at in those cases, but you have Michigan, you 

have Florida, you have states in the South and the West. And so, 

we would have a geographic distribution in order to make sure that 

we covered the money. What we try to do in these cases is cover, 

like right now we are looking at the State and Local Coronavirus 

Relief Fund, and we have selected 18 states, and they account for 

about 60 percent of the total amount of money. 

Ms. OCASIO-CORTEZ. Thank you, Mr. Dodaro. I would like to submit to the record this report from the Pandemic Response Accountability Committee, ‘‘State-Entitled Key Insights in State Pandemic 

Unemployment Insurance Programs.’’ 

Ms. OCASIO-CORTEZ. Now, Mr. Horowitz and Mr. Dodaro, can you 

think of any methodology that would have brought the committee 
27 

to send those three letters specifically to just those three states? Is 

there any methodology you can think of that would just result in 

Pennsylvania, New York, and California being under investigation 

by this committee? 

Mr. DODARO. Well, I would defer to the committee. I don’t really 

know what their objectives were in that case, and I don’t think—— 

Ms. OCASIO-CORTEZ. I understand. Now, I wanted to get into this 

report, and according to this report to PRAC, for example, Arizona 

paid $1.6 billion to individuals to—stolen identities to get unemployment insurance benefits. Louisiana dispersed more than $1 

million to individuals after the date of their death. And in Kentucky, state employees applied for unemployment benefits while 

still employed by the state, and were able to hack the state’s information management system and remove holds on their own accounts, and none of these states have been put under investigation 

by this committee. 

I find it very interesting because as was stated at the beginning, 

the bipartisan nature of oversight is what gives it its power. And 

what we are seeing are investigations into, and I believe that the 

methodology for these three states is highly questionable. And I 

ask for this committee, if we are going to perform oversight, then 

let’s perform oversight. Congressional Democrats are ready to perform that oversight and help our constituents get the benefits they 

need to pay their bills. And I think that there is no shortage of 

members of this committee who are willing to stand up to their 

own party when it is necessary, but I cannot for the life of me understand why the majority would send these three letters just to 

these three states that leave us with no other conclusion that there 

needs to be some rank partisanship in this investigation. 

Committee Republicans, I ask you now, if we are going to start 

off, let’s do it right. And with that, I yield my time. 

Chairman COMER. Before I yield back, if Ms. Ocasio-Cortez is 

willing, I would love to join in a joint investigation of the Kentucky 

unemployment system and New York unemployment system if you 

wanted to do that, a joint probe or whatever. I would love to work 

with you on that or any of the 50 states because I believe it is a 

problem in all 50 states, especially Kentucky. You are exactly right. 

The chair recognizes Mr. Higgins for five minutes. 

Mr. HIGGINS. Thank you, Mr. Chairman. We knew there would 

be fraud because fraud is always connected to money. I supported 

the CARES Act as a Nation’s initial response to the new virus. We 

didn’t know what it was. The CARES Act was our effort to respond 

and to help American families and American employees remain financially stable while we endured the impact of this unknown 

virus. So, here we are into year 4 of 2 weeks to flatten the curve, 

and it very well falls upon this committee under Republican majority to begin conducting meaningful oversight into the massive fraud 

that was no doubt staged to take place when you start rolling out 

programs with trillions of dollars. Some estimates as high as $7 trillion, the total economic commitment from the United States of America, American treasures, $7 

trillion. That is $7,000 billion. It is $140 billion per sovereign state 

is an average of 62 counties per state tested. That is over $2 billion 

per county. I would argue that Americans across the country and 
28 

in local and state government would say they would have done 

much better if every county could have received $2.2 billion in the 

form of a block grant. Of course there was going to be massive 

fraud with programs like this, but what we expected was not the 

absence of fraud. What Americans expected is a presence of accountability and criminal prosecution, and that accountability is 

what this Republican-controlled Oversight Committee is going to 

deliver. 

We know that fraud is not born in the mechanisms of man. 

Fraud is born in the heart of man. It is to be anticipated. The gentleman referred to certain tradeoffs between urgency and processes 

that were put in place as these trillions of dollars was set to be dispersed. Well, may I say that we anticipated this, but some of us, 

in order for the most conservative of us to support a $2 trillion response to this unknown virus, we insisted that this money be made 

available through local banks and credit unions. And we pushed 

the SBA product out through, my recollection is about 4,500 lending institutions that had never handled an SBA product before. 

We wanted, and we insisted that regular Americans would be 

able to communicate directly with the bankers they knew to access 

this assistance. So, we knew it was ripe for fraud, but we expected 

criminal investigations to take place, and we expected people to be 

put in jail. Accountability for criminal acts generally begins with 

a suspicion and a report at the local level of fraud, theft, forgery, 

identity theft, et cetera. That leads to an investigation, should lead 

to an arrest, should lead to prosecution, should lead to conviction 

and incarceration. May I say America will be just fine had we witnessed that kind of accountability, but it has to be pushed out of 

congressional investigations. That hasn’t happened for the last 

three years. It will happen now. 

Director Smith, so specifically regarding investigations, that it is 

understandable that the most massive cases will be prioritized, 

millions and millions of dollars. But according to my research, the 

vast amount of fraud that we have witnessed is primarily from 

smaller cases, and I have been advised that they have gone ignored. Can you speak to that, sir? What are we doing at the Federal level to assist local and state investigators to go after these 

smaller cases? 

Mr. SMITH. Sir, as I mentioned before, we follow money. We follow evidence. And one of the things that I talked about in my opening was the Secret Service training state and local law enforcement 

professionals at our National Computer Forensics Institute. It is 

the ultimate teach a man to fish, if you will. We train thousands 

of state and local law enforcement professionals every year to be 

able to investigate cases locally. 

I was just down in the chairman’s home state last week in Kentucky talking to some of our cyber fraud taskforce partners. And 

they were actually briefing me on cases they were working at a 

local level that were focused on elder abuse and some pandemicrelated fraud. So, we are a Federal law enforcement entity, but we 

do have a responsibility to help train, equip, and resource our local 

partners who help us in every aspect of our mission to be able to 

build their capacity locally. 
29 

Mr. HIGGINS. Thank you for your response, Director. Mr. Chairman, I yield. 

Chairman COMER. The chair now recognizes Ms. Porter for five 

minutes. 

Ms. PORTER. Good morning. I have questions about unemployment insurance. Mr. Dodaro, could you read this headline for the 

room? Yes, could you turn your microphone on, sir? 

Mr. DODARO. Sorry. I am sorry. ‘‘California’s EDD Unemployment System Disaster: Predictable Fiasco.’’ 

Ms. PORTER. Thank you. We are going to get everyone in on the 

fun. Mr. Horowitz, could you please read this headline? 

Mr. HOROWITZ. There is no way I can read this headline because 

I didn’t bring my glasses with me. 

Ms. PORTER. OK. I will read it for you: ‘‘EDD’s New Software 

Has Thousands of Defects, Some Critical.’’ Mr. Smith, we will see, 

is also an eye test in case you need to get a checkup. Can you read 

that for me, Mr. Smith? 

Mr. SMITH. It says, ‘‘The North Carolina Unemployment Agency 

is a Broken System.’’ 

Ms. PORTER. A broken system. North Carolina Unemployment 

Agency, a broken system. Mr. Horowitz, do these headlines seem 

familiar? Do they seem representative of the problems with the unemployment system during the pandemic? 

Mr. HOROWITZ. They do. 

Ms. PORTER. They do. Would it surprise you to know that all of 

these new stories are from 2013 and 2014, long before COVID–19 

was a problem? 

Mr. HOROWITZ. Not at all. This has been an issue that GAO has 

spoken about for decades maybe. I am not sure if it is that long, 

but certainly we have as IGs as well. The unemployment insurance 

system needs to be fixed. 

Ms. PORTER. I could not agree more. So, let’s talk about that and 

how we can fix it. What these headlines show, of course, is that, 

as you said, state unemployment agencies have long had problems 

getting help to people who need it and preventing our tax dollars 

from ending up in the wrong hands. When the pandemic first 

began, we needed to deliver relief quickly. But due to chronic 

underinvestment in technology and systems at states that administer programs, we saw the same problems with waste, fraud, and 

abuse that we have seen for decades under Democratic and Republican Presidents, in blue states and red states. Mr. Dodaro, I want 

to talk about the GAO’s High Risk List. What is that? 

Mr. DODARO. The High Risk List was originally created to identify, for the Congress and the Administration, areas across Federal 

Government that we believe were highly susceptible to fraud, 

waste, abuse, and mismanagement, or in need of broad-based 

transformation as it evolved. 

Ms. PORTER. Did GAO identify unemployment system, UI, as a 

high-risk program? 

Mr. DODARO. Yes. 

Ms. PORTER. When? 

Mr. DODARO. In 2022. 
30 

Ms. PORTER. June 2022. In June 2022, the year before unemployment was added to the high-risk list, do you know what the rate 

was of overpayment for unemployment insurance? 

Mr. DODARO. In 2021, it was 18.9 percent. 

Ms. PORTER. Great. And according to the Department of Labor, 

before that, before you put it on the high-risk list, it was about 15 

percent. In 2019, it was about 9.5 percent. In 2018, it was 12.1 percent. In fact, the overpayment rate has been over 10 percent for 14 

of the last 18 years according to the Department of Labor’s OIG. 

When GAO announced that the unemployment system had been 

designated as high risk, you said, ‘‘GAO is concerned that many 

longstanding problems may go unaddressed.’’ Do you remember 

saying that? 

Mr. DODARO. I believe so, yes. 

Ms. PORTER. Is that a little bit of an understatement at this 

point? 

Mr. DODARO. Well, you know, for many of those years, it was 

mostly state money that was collected. There really wasn’t big Federal investment in this until the pandemic broke, or perhaps earlier in some other emergency situation, but I thought the time obviously was right. 

Ms. PORTER. Yes. What the OIG has said is the UI program has 

experienced some of the highest improper payment rates across the 

Federal Government. So, my question is, why don’t we fix this? 

Mr. DODARO. Well, I think it requires some leadership on the 

part of the Congress and the Labor Department. You know, like a 

lot of these programs where the Federal Government has relied on 

the state and local governments, they give them a lot of discretion, 

and when times are good, unemployment is low, you know, they 

don’t get a lot of attention until these problems come up. 

Ms. PORTER. Mr. Dodaro, here is how I think about this. When 

someone has a dollar and they lose a dime of it, they think, shucks. 

But when someone has $100 and they lose 10 bucks, they are like 

little angry, and it just keeps going up, and now we are in the billions and trillions. So, I would love to have your continued pressure 

on the Department of Labor to use all of the funding that Congress 

provided in the American Rescue Plan to actually modernize UI because I am trying to add up where that $2 billion from the American Rescue Plan has gone, and it does not seem to have all been 

deployed and spent to improve these programs. 

Mr. DODARO. Yes. No, I agree. We are going to follow that $2 billion. Also, I was in the Senate testifying last March with Michael 

Horowitz and the IG from the Labor Department. He mentioned 

the money that was given to states after the Great Recession to reform the programs, and he mentioned some of that money went unused. 

Ms. PORTER. No, it absolutely did. Mr. Chair, if you will indulge 

me for just one minute. In California, after the American Recovery 

Act, they were given a $2 million grant to EDD to prevent fraud, 

and guess what? It worked. At the end of the grant program, California quit using the Fraud Detection Program, penny wise and 

pound-foolish because that exact Fraud Detection Program would 

have prevented and saved tens of billions of dollars for Federal tax-
31 

payers during this pandemic. So, I appreciate the chairman’s indulgence, and I yield back. 

Chairman COMER. Mr. Palmer, you want to be recognized? 

Mr. PALMER. Thank you, Mr. Chairman. I just want to affirm the 

gentlelady from California. Mr. Dodaro and I have worked on this 

for quite a while, and over half of the problems with improper payments are antiquated data systems at the state and Federal level, 

administrative error, and failure to verify eligibility. So, I just want 

to affirm what you just said, and I yield back. 

Chairman COMER. The chair now recognizes Mr. Sessions for five 

minutes. 

Mr. SESSIONS. Mr. Chairman, thank you very much. Mr. Dodaro, 

welcome. Mr. Horowitz, good to see you again. I would like to focus 

my question to you while it is this general subject. We have had 

conversations about ideas that went back and forth with the administration. Is there anybody at work? Are they there? Are you 

working with them? They are answering questions. Give me an 

idea about people at work, at least for the last two years. What has 

that been like? 

Mr. HOROWITZ. Yes. You know, we are engaged with folks. The 

Labor IG has been engaged with the Labor Department to try and 

address longstanding problems. As the Congresswoman said, this is 

not new. We have been engaged with OMB leadership and White 

House leadership to try, along with the labor IG, to try and push 

these issues forwards and get them addressed because the numbers 

are staggering. 

Mr. SESSIONS. Well, they are staggering. Then what is the 

progress—have they have come back to you? You have had meetings? What have they said? 

Mr. HOROWITZ. We have made some progress. Just to give you 

a sense of some of the basic issues, the Labor IG, because these 

programs are managed by 54 entities, the 50 states and other territories, the Labor IG needed to send regularly subpoenas to the 50 

states to get the data because that data isn’t housed at the Labor 

Department. 

Mr. SESSIONS. So, all 50 states denied information? 

Mr. HOROWITZ. No, no, they didn’t, but to get it, you needed to 

go to them and ask for it, and they needed legal process to be able 

to send it. So, we now have it at the PRAC. We are looking at it. 

Just to give you an example, you know, it was found because it is 

this locally based system. One social security number we have 

identified today, so far, was used in 29 states because the systems 

don’t talk to each other. They are not managed at the Labor Department, at the Federal level. They are managed at the state 

level, and, frankly, it is not fair to blame the states for that. They 

are not resourced to be able to fix and modernize their various systems. Some states have done more than others, but they are all, 

I think, it is fair to say, if not all, most are struggling with this. 

Mr. SESSIONS. But not a new issue. 

Mr. HOROWITZ. Not a new issue at all, and GAO has probably 

been at the forefront of that with the Labor IG speaking of this. 

Mr. DODARO. Yes, I think, you know, part of the problem Congressman Sessions is there is not sustained attention to these 

issues over time. And these issues require multi-year efforts. And, 
32 

you know, we have been working with the agencies, but quite 

frankly, where there are state-administered programs, Medicaid is 

another one, for example, which has huge improper payments, 

where it is administered at the state level. The Federal agencies 

give a lot of discretion to the states, and, quite frankly, there is not 

enough oversight on the part of the states. 

Now, this is a particular issue in the unemployment insurance 

program because in normal times, it is state money that is leveled 

on employers that pay, and there are no Federal funds involved 

until there is an issue where they need the money. And so, there 

is not a good sense of direction as to how involved our country 

wants the Federal Government to be involved in state-administered 

systems. And so, you run into a federalism issue a bit with these 

programs, and, quite frankly, I think it would benefit from congressional oversight and direction as to what signals that you want to 

send these—— 

Mr. SESSIONS. OK. Well, we agree with that. Mr. Dodaro, is there 

still such a thing that we invented with you years ago, 1997, the 

high risk series. 

Mr. DODARO. It is still there. 

Mr. SESSIONS. It is still there. 

Mr. DODARO. And SBA, two programs are on emergency loans 

are on the high-risk list along with the Unemployment Insurance 

Program, and there are 37 areas. We are getting ready for our normal update at the beginning of each new Congress. So, we are 

ready to unveil the update on the list soon. 

Mr. SESSIONS. That would be great. One question. Is this information on your website for the agency, or where do we find this 

information? 

Mr. DODARO. It is on our website. We have a whole special section, a medallion. It is GAO.gov, on our homepage, there is a medallion that says, ‘‘High Risk List.’’ 

Mr. SESSIONS. Great. I want to thank all three of you. The gentleman, Mr. Smith, please know that the Secret Service is a valuable organization to us, but you should know that you have got employee problems that we have been trying to work on for years, and 

I encourage your management to look at that about how they treat 

their employees and how quickly they respond back to the needs 

of those people. And I appreciate each of your time. Mr. Chairman, 

I yield back. 

Chairman COMER. Thank you. The chair now recognizes Mr. 

Gomez for five minutes. 

Mr. GOMEZ. Thank you, Mr. Chairman. This is the first hearing 

of a two-year session, and I want to be very clear to the American 

people what I believe that the majority, the Republicans in this 

committee and in Congress will do over the next two years. They 

will attempt to rewrite history. They will attempt to absolve themselves of any of the decisions they made over the last two years in 

order to fit their own political narrative, everything from the pandemic response to January 6, to holding President Trump accountable himself. We even had colleagues here that believe that some 

of the January 6 insurrectionists were patriots and heroes. They 

are not. They are traitors. That is what those are. Those insurrectionists were traitors. 
33 

So, let’s focus on unemployment insurance. The chairman and 

the majority of the Republicans voted 3 times in 2020 for UI benefit extension. Three times, and that is a good thing because it put 

money in the pockets of Americans who were struggling to make 

rent, to pay food, just to get by. But after a month of voting to extend those benefits, one month later, they voted to slash and to 

stop those unemployment benefits. What changed? Did they not 

know about some of the concerns of that program at that time? No. 

What changed is we had President Biden. My hunch is if it was 

President Trump, they probably would have voted to extend those 

benefits once again, but it wasn’t. And why are they cherry-picking 

this program and not focusing on other programs? 

So, now let’s talk about the Paycheck Protection Program. You 

know, as members, we voted to put the money in the pockets of 

constituents who needed it the most to keep their small businesses 

afloat. We voted to put money in their pockets, not Members of 

Congress. We have colleagues from Georgia who had $183,504 forgiven. Other Republican members had up to $4.3 million forgiven. 

Why not focus on this program? That is because if they did, they 

would have to answer these questions regarding their own businesses, their own loans, their own—and why were those forgiven 

and not others. 

So, if we want to talk about handouts, we want to talk about 

fraud, you know, let’s talk about it. Let’s not cherry-pick programs. 

Let’s pick all the programs that were in place during the pandemic, 

and let’s talk about if we want to do oversight, let’s do it, but this 

isn’t about oversight. It is about passing the buck and making one, 

too, so don’t be fooled. The American people shouldn’t be fooled by 

them trying to rewrite history and the role, and responsibility, and 

the implementation of those programs. I believe they were a good 

thing. You know, yes, no program is perfect, but it really did keep 

afloat the American economy, the American worker, and made sure 

that we didn’t fall into a deep, deep recession. 

So with that, let’s focus on, Inspector General, on the PRAC estimates. The PRAC estimates on the website say that we spent 

roughly $653 billion in pandemic expanded unemployment. However, your website also points out less than a quarter of that could 

potentially be improper, and less than that was fraud. Can you 

speak to the fact that a substantial majority of funds did what they 

were intended to do and keep Americans out of poverty and save 

lives? 

Mr. HOROWITZ. Certainly, Congressman. In all of the work we 

have done in the oversight work, no one has suggested or in any 

way sought to undermine the importance of these programs. We all 

can recall what was going on in March 2020, April 2020, and the 

need to assist and help people. The problem has been not that the 

programs were well intentioned or valuable. The problem is we 

have seen substantial amounts of that money not going to the people who is intended to help because of the fraud. 

We have also had hearings, and panels, and programs about the 

scope of the identity fraud, such that, for example, we heard how 

in the Unemployment Insurance Program, individuals who were intended beneficiaries, sometimes when they went to get benefits 

were denied because the state agency thought they were the 
34 

fraudster, not the person who came first who was the actual 

fraudster. And so, they struggled to just get the benefits they were 

entitled to. That is why these programs need to be fixed and addressed because Congress meant the money to go to the people who 

really needed it, and that is where we should be putting our efforts. 

Mr. GOMEZ. Thank you. With that, I yield back. 

Chairman COMER. The chair now recognizes Mr. Biggs for five 

minutes. 

Mr. BIGGS. Thank you, Mr. Chairman. Thanks for all of you. I 

am sorry, I have been in and out doing multiple hearings as we do. 

It is good to see you again, Mr. Horowitz. Mr. Dodaro, it is good 

to see you, and welcome, Mr. Smith. So I guess, I am going to try 

to broad shoot this thing here. Is there any money not expended 

in any of the COVID Relief packages that you are aware of? 

Mr. DODARO. Yes, there is about, as of November 2022, there is 

about $157 billion in unobligated funds. 

Mr. BIGGS. OK. Unencumbered, unobligated, unspent? 

Mr. DODARO. Right. 

Mr. BIGGS. OK. Great. Thank you. And what is the total amount 

that you estimate was spent through either fraud, improper payments, or waste in any of those programs? Go ahead, Mr. Horowitz. 

Mr. HOROWITZ. So, Congressman, it is even at this point too 

early to give any estimate that is reasonable. What I have said before and I will say again, it is clearly in the tens of billions of dollars, but it wouldn’t surprise me if it exceeds ultimately more than 

$100 billion, but we have so much work to do. It is why Congress 

extended the statute of limitations last year to 10 years. We are 

in year three, and that is why we need that extension on the unemployment insurance side as well, so we are going to be counting 

and figuring this out for years to come. We are going to go after 

every penny we can. We are going to use every tool you give us, 

but it is going to take time, and we are not there yet. 

Mr. BIGGS. Yes, sure. And, Mr. Smith, I read that you had returned through an analysis of, I think, 30,000 financial institutions, something about $3 billion to unemployment insurance benefits. Is that correct? 

Mr. SMITH. Yes, sir. 

Mr. BIGGS. OK. And I want to get to this because I think this 

is interesting. During the last round of questioning, the assertion 

was made that there was $653 billion overall in unemployment insurance that was disseminated through those programs, and that 

the estimate was somewhere below 25 percent was improper payments, fraud or whatever. So, if that is the case though, I mean, 

is that accurate? First of all, I want to just make sure. I don’t want 

to be misstating something. That is what I understood the testimony to be. 

Mr. DODARO. Yes. The Department of Labor estimated for 2021, 

improper payments of $78 billion, which is about 18.9 percent rate. 

Mr. BIGGS. OK. 

Mr. DODARO. And in 2022, it estimated $18.9 billion. That is a 

22 percent improper payment rate. And so, those are the estimates 

of the Department of Labor, and those estimates are for the regular 

unemployment benefits. It is not for the pandemic unemployment 
35 

insurance fund. So, those aren’t complete estimates for all the Federal spending that was made during the period of time. 

Mr. BIGGS. OK. 

Mr. DODARO. The Labor Department is now trying to figure out 

the Pandemic Unemployment Insurance Program. That is the one 

that went to people who are self-employed or working part time or, 

you know, that was the new program that was created. The other 

Federal programs extended the benefits, were added to the benefit 

during a period of time. Those programs are covered by the estimates, but not the other one, the new one. 

Mr. BIGGS. Doggone, I am more confused now than ever. 

Mr. DODARO. Yes, but I just want to be clear on exactly what has 

happened. 

Mr. BIGGS. No, I appreciate that. 

Mr. DODARO. Yes. Right. 

Mr. BIGGS. And as we go forward, maybe we could get together 

and just kind of suss out a little bit, you know, what that range 

might look like in totality versus—— 

Mr. DODARO. Yes. You know, what we have done is we have estimated on the unemployment insurance area. If you take the fraud 

rate and extrapolated that at the low end, the low end of the estimate is greater than $60 billion. 

Mr. BIGGS. Sixty billion dollars. Yes, I saw that. 

Mr. DODARO. Right, and now we are working to try to figure out 

an estimate. Again, no one will know—I agree with Michael—until 

all these investigations are underway. And I mentioned, the Labor 

Department IG is opening up 100 new investigations every week, 

and the PPP Program has over 500 investigations underway. So, 

there will be investigations into fraud on this for a period of time, 

but we are trying to give a sense of what we think the magnitude 

would be. 

Mr. BIGGS. Well, I look forward to continued discussion with you, 

gentlemen. And I just have to, Mr. Chairman, my colleague from 

New York earlier mentioned fraud occurring within the Unemployment Insurance Program in my home state of Arizona. What she 

did not mention is that Arizona actually identified the problem, 

partnered with a private sector company, and implemented an 

identity verification system because it is kind of getting to what 

you are talking about there, that a Biden administration official, 

Treasury, called, ‘‘kind of a silver bullet,’’ and that ‘‘almost immediately the fraud ring saw the game was up,’’ once the tools were 

rolled out, and you had a 99 percent reduction in fraud once when 

we implemented those measures in my state. 

So, I would love to take a closer look at Arizona’s response, how 

it worked, why it worked, and maybe we get there, at the Federal 

level as well, Mr. Chairman. And so, I appreciate, again, you all 

being here today, and thank you, Mr. Chairman. I yield back. 

Chairman COMER. Very good. The chair recognizes the gentleman from California, Mr. Garcia, for five minutes. 

Mr. GARCIA. Thank you very much, Mr. Chairman, and I want 

to thank you and the committee for having us. We look forward to, 

of course, hearing from and having been heard from all of our witnesses, so thank you very much. 
36 

Before joining Congress, I served as mayor of Long Beach, California. It is a city of about half a million people, coastal community. I was mayor during the entire time of the pandemic and the 

emergency. I also happen to be very proud of the response that we 

had as a community to this pandemic. President Biden called our 

response locally in Long Beach a national model. The Governor of 

California said it was the best response from a city in the state of 

California. In fact, we were the first community to vaccinate 99 

percent of our seniors. We were the first community to vaccinate 

all of our public school teachers in our school system, and we were 

the first city to reopen our public schools as a school system in the 

state of California. 

So, I lived the pandemic 24 hours a day, every single day since 

it started. And I think it is important as we have this hearing and 

others on this important topic because I know that the issue 

around the pandemic, and our response will continue to be an important topic for the Congress. It is important to remember that 

this emergency was a catastrophic loss of life event. We have lost 

over a million Americans across this country. And just in Long 

Beach alone, we have lost over 1,300 residents, friends, families, 

and neighbors. Personally, I lost both my mom and my stepfather 

to the pandemic. My mom was a healthcare worker, and so the loss 

is real for a lot of us. We also saw our economy collapse. Jobs were 

lost, businesses were closed, folks became unhoused, and families 

and kids were greatly impacted, particularly around schooling and 

their ability to learn every single day. 

Now, there has been a lot of attacks by the Republicans on this 

committee and across the House on the Biden administration and 

our response on the work that is happening in our agencies. I think 

it is really important to also note that we had a catastrophic emergency and that the President, the Vice President, and all the folks 

in our agencies did and are doing the best job that they can to 

manage this emergency, so I want to thank the President for his 

response. I want to thank his continuous work that is happening 

right now in our recovery. 

A lot of folks don’t realize that the CARES Act and the American 

Rescue Plan saved lives. It saved small businesses. It saved cities. 

It saved nonprofits. The money that was sent to us by the Federal 

Government kept cities like Long Beach afloat and countless others 

across the country. It allowed us to provide food for those that were 

hungry. It allowed us to keep people in their homes with tenant 

and rental assistance. It allowed us to open homeless shelters when 

people were falling into homelessness. It allowed us to provide 

small business grants to small businesses that needed to stay open, 

to restaurants that were about to close. And so, I am grateful to 

all of you that were involved in some type of oversight or implementation. I am grateful to the Federal Government for providing 

support for our cities. And most importantly, the money from the 

CARES Act and the American Rescue Plan provided opportunities 

for us to test, to vaccinate, and to keep workers employed. 

It is important to note that in any major crisis or emergency, 

there are going to be mistakes. We were all moving fast and quickly. We take them seriously and we learn from them. In California, 

for example, we have already seized and recovered over a billion 
37 

dollars in fraud and abuse. I think it is important to know that 

mistakes in emergencies are going to happen, but it is also to know 

who should be held accountable for some of these concerns being 

brought up by my Republican colleagues. And if Comptroller 

Dodaro can just remind us who was actually President when the 

pandemic started? 

Mr. DODARO. President Trump. 

Mr. GARCIA. Thank you for that because I remember as Mayor 

how difficult it was to get any sort of support from the White 

House. There was no PPE. We weren’t getting our masks on time. 

We had to go procure tests ourselves. And so, I am sympathetic 

that oftentimes in emergencies, things are going to be difficult. Us 

as a city had to spend $20 million of our own money immediately 

without knowing if we were getting reimbursed or having support 

from FEMA, just to keep people alive on the ground. And to Assistant Director Smith, which administration actually established the 

COVID–19 Fraud Enforcement Task Force? 

Mr. SMITH. Sir, we were protecting President Trump at the beginning of the pandemic. 

Mr. GARCIA. But then I believe President Biden actually put in 

place an additional committee on fraud and abuse on the pandemic. 

So, I say that because there is obviously going to be mistakes made 

across administrations, but I am grateful to the Biden-Harris administration today for actually trying to do as best they can to address some of the abuses that are happening. I also think it is important to put the entire context of what we are talking about in 

this idea that we have just experienced the single largest loss of 

life event in the modern era of our country. So, I want to thank 

the three of you for your service, and I want to thank the committee for bringing this up in this hearing. I yield back the rest of 

my time. 

Mr. PALMER.[Presiding.] Before I recognize the next member, Mr. 

Dodaro, you said there were $137 billion in unobligated COVID 

funds that—— 

Mr. DODARO. I believe it was $157 billion. 

Mr. PALMER. A hundred and fifty seven billion? 

Mr. DODARO. Yes. 

Mr. PALMER. If you have a general estimate of the total amount 

of unobligated funds in all agency accounts regardless of what they 

were there for, do you have an idea of what is out there? 

Mr. DODARO. Do you mean for all Federal spending? 

Mr. PALMER. Yes, and unobligated funds. 

Mr. DODARO. I don’t have any idea on that right now. I can find 

out and provide it for the record. 

Mr. PALMER. I would appreciate it if you would provide that. 

Mr. DODARO. It is a big government. 

Mr. PALMER. Yes. 

Mr. PALMER. The chair now recognizes gentlelady from South 

Carolina, Ms. Mace, for her questions. 

Ms. MACE. Thank you, Mr. Chairman. I also want to thank the 

ranking member for this hearing today. And the partisanship and 

the politics of this hearing is absolute and complete B.S. Our country and the entire world faced a pandemic unlike anything our generation has ever faced, and some decisions were made that were 
38 

good and some decisions were made that I am sure we are going 

to look back on 20 years from now and have a great heartburn over 

like all of the fraud that has been committed. 

You know, partisanship in politics has kept us from doing our job 

on oversight. It keeps us from doing our job in Congress. It keeps 

our Federal agencies from being able to be the best that they can 

be. And any time that the Federal Government spends trillions of 

dollars, we should ensure it is safekeeping regardless of who is in 

power. COVID–19 is not the fault of this administration or the past 

administration at all, but it is up to us. I mean, the spending and 

the fraud has been a product of Republicans and Democrats for 

generations and for decades. We have got to ensure that the safekeeping of this money is done better now than ever before. 

There was guidance from Federal agencies on how to allocate 

these funds. The guidance was vague and led to potential integrity 

concerns and opportunities for bad actors seeking to take advantage. And I know that at the time this was rushed, and there was 

an urgency because of the worldwide emergency, but even with 

these concerns, the money kept flowing. As the last two COVID Relief spending bills added to the sum total of $1.15 trillion payments 

to individuals, just over $1 trillion to unemployment, when we literally paid people to stay home. No wonder none of us should be 

surprised it was hard to get people out of their homes and back to 

work, and we had, you know, $779 billion for PPP loans. A total 

of about $5 trillion was spent roughly on COVID relief. 

As of today, there have been over 1,000 people convicted of fraud 

relating to COVID–19 problems. Over 600 are currently facing 

similar Federal charges, and it sounds like by the testimony today, 

there might be thousands more charged in the years ahead. And 

I appreciate everyone’s testimony today, coming here and being 

forthright with our committee. 

Today I am encouraged by our leadership on oversight, that we 

will leave no stone unturned to uncover waste, fraud, and abuse 

plaguing these programs. And the thing that I found, I think, most 

interesting to me in the testimony today is the data issues that we 

as a Federal Government have. You mentioned, Mr. Horowitz, 

about having to subpoena 50 states for data, and it doesn’t matter 

if we are dealing with immigration, or we are dealing with COVID 

relief fraud, or we are dealing with background checks on bad guys 

trying to buy guns. We have a real problem with data, data integrations, our systems talking to one another, or legacy technology 

that is being utilized. And if we don’t fix it soon, we are just going 

to be overrun with it. 

So, I appreciate some of the ideas that have been put forth, but 

one of the things that has intrigued me and I think it probably intrigues a lot of people, and this is in the few moments that I have 

left in the committee today, is the use of artificial intelligence in 

some of this and trying to find the fraud. And of course, now we 

all know about it, since ChatGPT, 5 million users, I mean, 1 million users in the first five days and only growing exponentially, and 

they are not the only ones. I mean, there is GitHub, and Copilot, 

and a bunch of others. 

But I would just—my questions today, and I will start with you, 

Mr. Horowitz. Can you explain the type of work, you know, how is 
39 

AI being used? Is it advantageous? Is it speeding up the process? 

How useful is it? Just some of your feedback with the use of AI and 

detecting fraud. 

Mr. HOROWITZ. Yes, and thank you, Congresswoman. It’s a very 

important question you raise, and I think at the outset, people 

need to be cautious about it. We have also read about some of the 

cautions in using AI. I know IGs are doing oversight work in that 

space. GAO is as well, but it can be very helpful. And in fact it is 

just a further advancement at some level of the analytics that we 

are using to try and find issues, and anomalies, and problems, and 

things we should be following up on. 

So, for example, we used a more primitive form of AI at the outset to try and help the SBA inspector general because they were 

getting in one day 1,000 or more complaints, which was more than 

they had gotten in the prior year in total. They needed to try and 

figure out and triage those, what were the highest level most important ones. They came to the PRAC. We helped them triage that 

by using a form of, if you will, AI, far more primitive than what 

you mentioned. But those are the kinds of things we can do. It is 

something that we have to do as governmentwide agencies need to 

use it. Inspectors General need to use it. I know GAO uses it. It 

is the future of oversight. 

Ms. MACE. Thank you. And I have run out of time, but I look forward to working with you all as the new subcommittee chairman 

on Tech, Cyber and Government Innovation. It is going to be a 

huge marker for us to determine waste, fraud, and abuse in the future and I agree. Thank you for your time today. 

Mr. PALMER. The chair now recognizes gentleman from Florida, 

Mr. Frost, for five minutes for his questions. 

Mr. FROST. Thank you, Mr. Chairman. I am glad that we are 

starting this committee talking about waste, fraud, and abuse, and 

how we can make government work better for the people. You 

know, Mr. Chairman, the previous comments, I agree with the initial comment that we need to take the politics out of the discussion, 

take the politics out of this, and the posturing and the hyperbole, 

so that way we can work together, again, to modernize our government and make it work for the people. And I hope this committee 

will continue to look into other financial abuses such as wage theft 

and corporate welfare as we continue over the next two years. 

Assistant Director Smith, you know, we have heard a lot of hyperbole and political posturing from this committee today. I think 

the way that we communicate and talk about an issue is extremely 

important in finding the solution. You know, we have heard things 

like the ‘‘greatest theft in our country’s history.’’ I am curious from 

the point of view from law enforcement, does that type of hyperbole 

when talking about crime work to exacerbate the issue? 

Mr. SMITH. Sir, thank you for the question. I think it is inconsequential to the bad guys as a law enforcement professional. Bad 

actors exploit situations, no matter what the political climate is, so 

we focus on investigating violations of identity theft, fraud, wire 

fraud and bank fraud. 

Mr. FROST. OK. Thank you. Thank you, Mr. Dodaro. Is it Dodaro, 

right? Yes, OK. All the GAO’s recommendations include increasing 

the capacity and resources of the Federal Government to help deal 
40 

with the waste, fraud, and abuse. You know, oversight isn’t just 

talking about an issue, you know. We have to solve it. And in the 

spirit of solving it, can real improvements be made without additional resources and money to the government, to these departments and agencies, so that way they are set up for success to deal 

with the issues? 

Mr. DODARO. Yes, some of them can be made without additional 

resources. Some need additional resources, such as the IG community, to continue their investigations on fraud, but also to set up 

this analytics center. And so, you know, it is really a mixture of 

both. 

Mr. FROST. Do you think that the amount of resources that were 

allocated during the previous administration was sufficient enough 

for what we are dealing with? 

Mr. DODARO. I think there was adequate money given. I think 

it was just a choice of decisions that were made. In some cases, you 

know, I talked about limitations in the legislation itself. The agencies made decisions that I think could have been different decisions. They were given money to help administer the programs. I 

think there could have been a little bit more flexibility that was 

given. 

I know Treasury has run into some problems recently because 

they couldn’t redistribute the money among some of the programs, 

particularly new programs, because until you start administering 

them, you don’t know whether it is an adequate allocation or not. 

Congress fixed that with the latest Consolidation Appropriation 

Act. But I think by and large, the resources were there, it was just 

some decisions that were unfortunate. 

Mr. FROST. Got you. Thank you. Thank you. Mr. Horowitz, on 

this committee, I have heard a lot of demonizing of Washington bureaucrats, and bureaucrats are often scapegoated. And to be clear, 

when we talk about bureaucrats, we are talking mainly about 

working class people who have decided to serve their country by 

working to power our government. Do you believe that one of the 

central issues here is that agencies and departments were not set 

up for success? And I am thinking specifically about the previous 

administration, we got into this issue. Do you believe they were set 

up for success to be able to dole out the amount of money that was 

being given out? 

Mr. HOROWITZ. You know, I think the problem at the outset of 

the pandemic was, as the comptroller general has mentioned, the 

lack of preparedness. Now, understanding this was a 100-year 

event with the pandemic, but we have emergencies all the time. We 

have earthquakes, floods, hurricanes, tornadoes, other disaster relief. It happens regularly, not at the scale perhaps as this did, but 

we don’t take the steps after an event like this or smaller emergency events to fix what is needed. That was the problem. 

Just to give you a sense of it, the SBA, Small Business Administration, which administered the PPP and EIDL Program, the largest amount of money they had ever given out in a loan program 

prior to the pandemic was $30 billion. They were giving out $50 

billion in a day when the pandemic hit. So when you say, were they 

ready for success, well, if you go to an agency that has experience 

giving out $30 billion over a year and you say, here is $800 billion, 
41 

get the money out the door, which was the initial PPP Program. 

That is a recipe for a very challenging situation, no matter who is 

running the agency. 

Mr. FROST. Yes. No, no, thank you, Mr. Horowitz. Yes, and I 

think the point here is, I agree, we need to prepare for the future 

here, whether it is a pandemic or anything else. And I am looking 

forward to working with my Republican colleagues on ensuring 

that we give the adequate resources and know how to our agencies 

and departments, so when this happens again, we are prepared for 

it. Thank you. I yield back. 

Mr. PALMER. The chair now recognizes the gentleman from Florida, Mr. Donalds, for five minutes for his questions. 

Mr. DONALDS. Thank you, Mr. Chairman, and to the witnesses, 

thank you for being here. It is actually great to have all the witnesses here in person. It is a novel thing in the 118th Congress, 

so really appreciate your attendance. 

A couple of things has been stated through the hearing that, you 

know, we want to make sure that oversight is being conducted, of 

course. But I would like to remind a lot of my colleagues and a lot 

of the freshmen who are here for the first time, there was no oversight over any of these dollars in the last Congress. I know that 

because I sat on this committee, and there were no oversight hearings about anything associated with pandemic spending, so I am 

glad that we are tackling this now. 

And it is critical because the other thing that is kind of in the 

news cycle, especially today, tomorrow, will be with us for a couple 

months, is we have hit our debt ceiling. We are out of money, folks, 

$31.5 trillion. We don’t have new money. And so, if you are going 

to take account of having to potentially raise the debt ceiling in the 

United States of America, you have to take account of how the Federal Government goes through the process of spending its money, 

whether through normal times or even through pandemic times. 

Mr. Chairman, I want to submit for the record an article by Politico. The title of the article is, ‘‘Biden Administration Reroutes 

Billions in Emergency Stockpile, COVID Funds to the Border 

Crunch.’’ That is the article. 

Mr. DONALDS. The article states that the administration went 

through a process of reappropriating, or moving around almost $2 

billion from money supposed to go to the Strategic National Stockpile, and also funds intended to help study long COVID that was 

at the National Institute of Health and rerouted to actually help 

house migrants coming across the Southern border because of the 

President’s reckless border policy. So Mr. Dodaro, are you aware of 

this reshuffling of dollars from the pandemic emergency to the 

southern border, in my view, failed strategy of the President? 

Mr. DODARO. Yes. 

Mr. DONALDS. And, Mr. Dodaro, when the President made this 

rerouting, what were some of the uses of funds that it was used 

for at the southern border? 

Mr. DODARO. I don’t have that information right now. I am 

aware the situation and what happened, but I don’t know, you 

know, the details. 
42 

Mr. DONALDS. OK. Well, one of the things that I will request 

from you and your office is could you provide the committee those 

details? 

Mr. DODARO. Sure. 

Mr. DONALDS. Because it is going to be important for the Oversight Committee to understand that when money was shuffled from 

pandemic response to border policy, which, by the way was just a 

unilateral policy shift at the beginning of the Biden administration, 

that could have put American citizens at risk during the pandemic. 

And the reason why this is illustrative is because if we go down 

the line of setting precedents on how funding is going to be used, 

we should have an idea of what administrations have done in the 

past. So, I think this is actually very critical information. 

One other point, there is money that came through the American Rescue Plan, the $1.9 trillion, ‘‘COVID bailout of the American 

economy,’’ I say, quote/unquote because it really didn’t work, but a 

bunch of that money is actually supposed to go to state and local 

governments, including to school districts through ESSER funds. 

Now, Mr. Dodaro, there is another tranche of this money that is 

slated to go out. This goes to the previous question by Mr. Palmer, 

about obligated funds, somewhere to the tune of half a trillion dollars that is slated to go out, and the President has now said that 

he is going to end the COVID emergency effective May 11. If the 

COVID emergency ends effective May 11, what is going to happen 

with these ESSER funds that are obligated, but have not yet been 

transmitted? 

Mr. DODARO. I will have our attorneys take a look at that to 

make sure because we have appropriation law attorneys that provide assistance. But I think—I am not sure the funding is tied to 

the national emergency declaration in terms of what is been appropriated already. And I know some of the funds are available for use 

up to 2026, some up to 2030, so I don’t know if the termination of 

the national emergency would trump what is already in the legislation in terms of how available those funds are made, but I will 

have our attorneys take a look at it. 

My guess would be that the appropriation would be the governing factor for the uses of those funds in the future, that they 

would still be available, but I don’t know for sure. I will have a 

double check on that. There are some funding things, particularly 

in Medicaid, for example, that would have to be changed that are 

tied to the national emergency declaration. 

Mr. DONALDS. Agreed. Medicaid is one of those things that is tied 

to the national emergency. I would just proffer for the committee 

that if we are going to go down this road of having to find a way 

to raise our debt ceiling, one of the things we should do is we 

should end letting money go out the door that was tied to the pandemic. That is now essentially over. With that I yield back. 

Mr. PALMER. The chair now recognizes the gentlelady from 

Vermont, Ms. Balint, for five minutes for her questions. 

Ms. BALINT. Thank you, Mr. Chair, and good afternoon, all. 

Thank you for being here. I am sitting here as a new Member of 

Congress, but I am also sitting here as a former leader of my state 

senate in Vermont, and was on essentially our state’s frontlines in 

dealing with the pandemic emergency much like my colleague, Mr. 
43 

Garcia. And I want to be clear that we all want to reduce improper 

payments. I think that is clear. I don’t know some of my colleagues 

on the Republican side, but I think we all can agree that that is 

a goal because it is the people’s money. 

What I want us to do, though, is bring us back to that moment 

at the beginning of the pandemic. It is a moment that I remember 

so clearly, thousands and thousands of Vermonters calling my office, calling the office of all of my colleagues, Republicans and 

Democrats, to say, we are desperate. We are desperate. We can’t 

pay our bills. We don’t have money for food. We can’t pay our rental payments. And I cannot convey to you the loss of sleep or the 

worry that we all had as state legislatures trying to protect our 

people. And what I am concerned about this morning is I feel like 

at the heart of this hearing, has been a false choice between ease 

of access to government assistance when disasters strike. And as 

Mr. Garcia said, we lost over 1.1 million Americans, and I am sure 

like many of the people in this room, I know people who succumbed 

to the pandemic. So, I believe it is a false choice between ease of 

access to help alleviate fraud, and making sure people get the help 

they need. This is about real people. It is about real families. It is 

about desperate people needing assistance. 

And so, the question I have for you this morning is, do you agree 

with that assertion that government must either choose speed or 

accuracy, because what I know is getting the money out quickly to 

people desperately in need saved lives in every community in my 

home state. 

Mr. DODARO. I think you can do both if you are prepared, and 

that is what I have said all along. I have acknowledged in all our 

reports the important assistance delivered to needy Americans, but 

there are definitely choices. I mean one of the things, the economic 

impact statements where the money went directly to individuals, 

there were some problems with that. The first round, $1.4 billion, 

went to deceased individuals. We have gotten about half of that 

back, one of which was my own mother who had passed away earlier and my sister returned the money, though, so. 

Ms. BALINT. Is that on the record, Mr. Dodaro? 

Mr. DODARO. Yes. 

Ms. BALINT. OK. Just checking. 

Mr. DODARO. Yes. No, that is. 

Ms. BALINT. I am joking. 

Mr. DODARO. I have already said it when I testified in 2020 on 

this. 

Ms. BALINT. OK. 

Mr. DODARO. But the programs that are administered through 

third parties present problems, and if the agencies are prepared 

and they are designed properly, you can get the money out quickly, 

but you can also minimize the fraud. We are not saying you can 

never eliminate it, but I think if the agencies are prepared, the programs are designed properly, people can get the aid they need as 

soon as possible. What happened with the fraud, though, is because 

some of these funds were limited—— 

Ms. BALINT. Can I, Mr. Dodaro, just because I am going to run 

out of time. I appreciate it. 

Mr. DODARO. Yes, sure. 
44 

Ms. BALINT. So, a follow-up question is, can you highlight for us 

the ways in which we can design benefit systems with the recipient 

in mind, making sure that we are combating improper use of funds, 

but making sure it is meeting the needs of the people on the other 

side, those real Americans who need the help? 

Mr. DODARO. Right. Yes. Well, I think we need better identity 

verification systems to know who the people are that are applying. 

Mr. Horowitz talked about that. I have talked about that. We have 

made recommendations about that. I think the agencies ought to 

be better prepared to know how to prevent fraud from happening 

in the first place. There are a lot of different ways that those 

things could be done and be done properly. 

Ms. BALINT. I appreciate that, and I am eager to partner with 

anyone on this committee that wants to address these two things 

simultaneously. And I just want to say, in this committee, we have 

to keep the people back home in mind every single day. I yield 

back. 

Mr. PALMER. The chair now recognizes the gentleman from North 

Dakota, Mr. Armstrong, for five minutes for his questions. 

Mr. ARMSTRONG. Thank you, Mr. Chair. At this point in time, we 

have all seen the headlines, ‘‘Paycheck Protection Program fraud,’’ 

‘‘Economic Injury Disaster Loan fraud,’’ ‘‘improper unemployment 

payments.’’ And I would like to concur with my colleague from 

Florida in that one of the common and unfortunate denominators 

to these headlines is that when they held the majority, Oversight 

Committee Democrats failed to hold a single hearing to protect 

COVID relief programs from waste, fraud, and abuse. 

But I think the most frightening result of this lack of oversight 

is that foreign hackers, including those acting on behalf of foreign 

countries, have tapped into these large funding mechanisms and 

stolen dollars meant for struggling Americans. I understand that 

the large scope and quick disbursement of COVID relief can result 

in waste, fraud, and abuse, but it is unacceptable that our strategic 

adversaries had such an easy means to infiltrate through cyber 

means. Specifically, in December of last year, it was reported that 

a hacking group which was talked about a little earlier as APT 41, 

stole at least $20 million in U.S. COVID relief funds, including 

both unemployment insurance dollars and Small Business Administration loans. 

By the time the COVID relief funds became a target of opportunity, APT 41 had been in existence for about 10 years and had 

become the workhorse of the cyber espionage activities for the Chinese Communist Party. The hackers are believed to be connected 

very closely to the government, and they allegedly act on orders directly from China’s Ministry of State Security. While there are 

many bad actors targeting government programs, this is allegedly 

the first strategic foe, a state-sponsored cyber threat of the U.S. 

COVID benefit funds. 

Assistant Director Smith, earlier you answered that the Secret 

Service is unsure if APT 41 was directly ordered by the Chinese 

government to target U.S. COVID relief funds. When do you think 

the Secret Service expects to have resolution on if the hackers 

acted on their own accord or by government direction? 
45 

Mr. SMITH. Sir, sometimes in the context of a criminal investigation, those answers never get reconciled. As I said before to your 

colleague who asked me the question originally, we focus on financial crimes, and sometimes financial crimes leads you and the evidence leads you to entities that may have other interests in mind. 

Again, if that happens, we employ our partners at the Department 

of Justice, who may also have some additional angles into how they 

are looking at particular groups. 

Mr. ARMSTRONG. And just generally speaking, whether they were 

working directly for them or not, I mean, the Chinese Communist 

Party knows of their existence, right? 

Mr. SMITH. I cannot attest to what their knowledge is or not. 

Mr. ARMSTRONG. Reports have stated that Secret Service recovered nearly half of the $20 million stolen by the APT 41 hackers. 

I am assuming you are continuing that investigation. 

Mr. SMITH. Yes, sir. 

Mr. ARMSTRONG. These are kind of unfair in that. Do you have 

any timelines and like do you have anything you could share with 

us, either publicly or sometime privately? 

Mr. SMITH. That case is a large, very broad case out of our Denver Field Office, and it will be unpacking that for some time, sir. 

Mr. ARMSTRONG. Comptroller Dodaro, as I mentioned, hackers 

have targeted the unemployment insurance funds of several states, 

the extent of which is still unknown. What can we do outside of 

tearing down those entire systems in all 50 states to provide states 

with whatever safeguards the Federal Government can on unemployment insurance programs, even without enhanced COVID benefits from foreign actors? 

Mr. DODARO. Well, I think the Labor Department, with some of 

the funds that have been given available, has begun to set up identity verification methods, means to also check addresses, so those 

efforts need to be continued to go down the road. But cybersecurity 

is an issue that the Federal Government, governments at all levels 

haven’t heeded. I put that on the high-risk list across the Federal 

Government in 1997 and added critical infrastructure protection in 

2003. This problem has been known for a while, and I think we 

need to make sure we have more modern systems that can check. 

The other problem is allowing data sharing. It took me years to get 

Congress to allow the Social Security Administration or to require 

them to give the Death Master File to the Treasury Department so 

we could stop paying deceased individuals. That hasn’t even happened yet. It is not scheduled to happen until next year, and recommending that that be expedited. 

So, there are a lot of things that could be done, but the systems 

have to be modernized. There are too many legacy systems. Some 

of the state systems go back to the 1970’s, and some of the Federal 

Governments are decades old as well. 

Mr. ARMSTRONG. Yes, in many states, that is the last IT upgrade 

everybody does, I mean, regardless, all the way across. So, thank 

you. I yield back. 

Mr. PALMER. The chair recognizes Ms. Lee. 

Ms. LEE. Thank you, Chairman, and thank you to the witnesses 

for your testimony. It is still surreal to be in this room on the Oversight Committee. 
46 

In January 2023, our country has experienced multiple mass 

shootings and a lynching at the hands of police. And yet here we 

are, the very first hearing of the Oversight Committee, to criticize 

critical unemployment benefits from a global pandemic. This isn’t 

just politics for me. Before joining Congress, I, like many of my colleagues, served for years as a state legislator in Pennsylvania. Just 

one year later, we crashed head on into this global pandemic that, 

frankly, we were not remotely prepared to handle. 

Every single day, I heard over and over and over the desperate 

calls of folks unable to access food banks, people facing the risk of 

homelessness, folks literally contemplating suicide, unable to eat or 

work. Every call was a real Pennsylvanian, a real person whose literal lives relied on the same benefits my colleague see fit to criticize this morning. When the benefits were ended in September 

2021, there were 174,572 people receiving the pandemic emergency 

UC and 387,932 people receiving the pandemic unemployment assistance in the Pittsburgh Metro Area. The pandemic relief was literally the difference between life and death for my community and 

communities all over the country, so focus on the people impacted. I turn to you, Mr. Horowitz. Understanding $3.1 billion was secured in the Consolidated Appropriations Act of 2023 to protect and 

strengthen the federated UI system under the Department of Labor 

Inspector General, can you tell us how these investments could be 

used to improve the federated Unemployment Insurance system? 

Mr. HOROWITZ. Absolutely. Thank you, Congresswoman. And, 

you know, we held hearings about the value of the Unemployment 

Insurance Program and other programs to help communities, as 

you said, but also heard about the challenges that communities had 

to get the money in the right place. First and foremost, the money 

needs to be used to modernize IT systems. It is different state to 

state. Some states have older systems than others. But it seems to 

me that one of the first things that has to happen is the funding 

needs to be used to modernize antiquated state systems. 

Ms. LEE. Thank you. I can certainly attest to that. Ours was a 

system that was entirely ill-equipped to handle this. By March 

2020, I believe, almost a million Pennsylvanians found themselves 

suddenly unemployed. With that in mind, I have the same question 

for Mr. Dodaro. Again, how these investments could improve the 

federated Unemployment Insurance system? 

Mr. DODARO. I would echo the first comment that Mr. Horowitz 

made that the IT modernization systems need to be put in place 

in each state. Now each state has a different program. I mean, 

their eligibility requirements are different. So, it has to be tailored 

systems. Second, though, I think there ought to be more data sharing agreements made on the part of the states to work together. 

Mr. Horowitz gave an example before of a Social Security number, 

one number that was used by 29 states. That shouldn’t be able to 

happen with the use of modern technology. I also think that the 

Labor Department ought to try to have states voluntarily implement fraud reduction programs. I mean, there was fraud rate of 

about at least four percent in these unemployment programs before 

the pandemic. 

So, there has been fraud in these programs for a number of 

years. And the requirement for the Federal agencies to implement 
47 

GAO’s fraud reduction framework is for Federal agencies, but it 

doesn’t cascade down to the state level, which is something I think 

Congress ought to consider. And the Labor Department is helping 

them have fraud prevention programs. They have to make sure 

that they are adequately staffed properly as well. The problem was 

that, you know, we were at historic and low unemployment rates. 

The states had reduced their staffing systems, had old IT systems, 

not a prescription for success, and so I think they need to deal with 

those issues. 

Ms. LEE. Thank you, and thank you, Mr. Chairman. I yield back. 

Chairman COMER.[Presiding.] Thank you. The chair now recognizes Mr. Timmons for five minutes. 

Mr. TIMMONS. Thank you, Mr. Chairman. Mr. Dodaro, I want to 

begin by thanking you for your work with the Select Committee on 

the Modernization of Congress. We were able to get signed into law 

just in December the Improving Government for American Taxpayers Act. We hope that we can get the executive branch to act 

on your recommendations and probably save taxpayers billions and 

billions of dollars, so I just want to begin by thanking you for that. 

Mr. Horowitz, it seems that there is likely tens of billions of dollars in PPP loan fraud that has yet to be uncovered. Is that fair? 

Mr. HOROWITZ. There is likely tens of billions. 

Mr. TIMMONS. Some estimates are as high as $100 billion, but we 

can just agree on tens of billions? 

Mr. HOROWITZ. Yes. 

Mr. TIMMONS. That is fine. It seems to me that you have all of 

the information necessary at your disposal to identify this fairly 

rapidly. You look at the Q4. Well, you get the business tax ID number and you compare the Q4 withholdings for W2 employees versus 

the amount of the PPP loan, and then the Q2 and Q3 of 2020 

withholdings, and there should be an algorithm or some sort of a 

proportionality between those different numbers. So, that should be 

some sort of a report that you can run and then you can just start 

arresting people. Is that not how this should happen? 

Mr. HOROWITZ. There might be a little more sophistication to it, 

perhaps, but let me just say, we don’t have access to that data. 

Mr. TIMMONS. What do you need from Congress because it is literally a report. You should be able to run a report on those four 

data points, and then you are going to get tens of thousands of 

businesses that got PPP loans fraudulently, because if the metrics 

don’t match up, then they lied, and they stole, and they need to go 

to jail. So, what do you need? 

Mr. HOROWITZ. A clear congressional action in legislation that 

says that. It took the fraud alert we issued this week matching our 

information, and all we did was send name, date of birth, and social to the Social Security Administration and said don’t send us 

back your data. Just give us yes/no answers. Are these the real 

names? It took us 10 months to do that. 

Mr. TIMMONS. Again, we agree—— 

Mr. HOROWITZ. Yes. 

Mr. TIMMONS [continuing]. That the Q4 withholdings of 2019 and 

the Q2 and the Q3 withholdings of 2020, plus the amount of the 

PPP loan, those numbers should have a proportional correlation 

that we can all agree is fairly straightforward. It is going to be up 
48 

and down a little bit depending on how much your rent is, what 

your utilities are, but those numbers should all match up. And if 

there is a huge discrepancy, and whatever that correlation is, then 

they probably stole, and it was fraudulent. Do you just need us to 

force everybody to create that report? 

Mr. HOROWITZ. What we need is access to data. It is what the 

comptroller said about just the Death Master File Index. 

Mr. TIMMONS. I don’t even think you need access to that. You 

need that report run, and you need to have the list, and the discrepancy, and the correlation of those four metrics, and then you 

need to go and start putting people in jail. 

Mr. HOROWITZ. We need the data analytics platform to continue, 

and we need access to all of this data, and Congress has to legislate 

that. 

Mr. TIMMONS. Do you need access to the data, or do you just 

need Treasury to run a report? 

Mr. HOROWITZ. They won’t run the report unless it is clear. We 

have access—— 

Mr. TIMMONS. We can make them run the report. 

Mr. HOROWITZ. That is what we would need as well then. That’s 

correct. 

Mr. TIMMONS. I am sure that this is not a partisan issue. If people stole tens of billions of dollars in COVID relief, possibly denying 

benefits to people that actually needed it, those people need to be 

held accountable. And the fact that here we are years later and we 

still have not done something, that should literally be as simple as 

running a report in a computer at the Treasury Department. I 

mean, you need us to pass a law making them do that. 

Mr. HOROWITZ. We need a law. We would love to get employer 

identification number information to see if some of it actually exists. 

Mr. TIMMONS. Why would Treasury not do this? 

Mr. HOROWITZ. Because there are Federal laws, like Section 6103 

of the Tax Code, that restricts sharing of tax information. And we 

are not talking just for the public’s benefit, not individual income 

tax returns that we are talking about, but 6103 is written broadly 

for a variety of very good reasons to limit where that—that tax information. 

Mr. TIMMONS. All right. Well, look, there are four pieces of data 

that are attached to every business tax ID number, and this should 

be easy. I will work on legislation with everyone that is willing, 

and we will try to get you that information as quickly as possible. 

Thank you. With that, I yield back. 

Chairman COMER. The chair recognizes Mr. Casar for five minutes. 

Mr. CASAR. Thank you, Chairman, and thank you, Ranking 

Member. I am so glad that we are having this hearing. After years 

in local government working 24/7 during the pandemic to save lives 

and jobs in Texas, I have this opportunity to thank the Congress 

for their work, bipartisan work on the CARES Act. And thank you 

to congressional Democrats for the American Rescue Plan. 

Congress should be proud of the way that those bills helped save 

people’s homes, kept people in their jobs and kept people alive. I 

want to be clear. No one in the country is more strongly against 
49 

fraud than my working-class constituents who needed those COVID 

dollars to make sure their small businesses kept running, to make 

sure they got PPE at work, to make sure they got vaccines, to 

make sure their house wasn’t foreclosed on. Any dollar taken from 

those programs by fraudsters is a dollar taken away from people 

who needed support. 

And similarly, we must be against fraudulent 

mischaracterizations of COVID relief programs that ultimately aim 

to reduce aid to people in need through these programs and other 

programs. We can talk all day in D.C. about COVID programs 

theoretically, but as a former city leader who put these programs 

in place, I can tell you that thanks to the work of the Congress and 

President Biden, local leaders in my community, one, saved people’s homes; two, saved local economies; and three, saved lives. 

So, before I ask my question, I just want to share some facts that 

you may not have heard from Texas. One, we kept people from losing their homes through protections against evictions and foreclosures plus Federal housing relief dollars. The city of Austin reduced evictions in 2021 by 75 percent, keeping thousands of people 

in their homes. Conservative estimates are that COVID housing 

programs kept over a million Americans from losing their homes. 

Two, we saved local economies. Because these programs and this 

kind of funding, the city of San Antonio in my district was able to 

support over 1,200 small family businesses, keeping them from 

closing, provided 160,000 meals to residents in need, trained over 

5,000 struggling workers, putting thousands of people to work. The 

ARP kept 12 million people out of poverty, and pandemic relief programs according to CBO, kept GDP up eight percentage points. 

And third, we saved lives. Thanks to the funding for vaccinations 

and public health programs plus our COVID rules, the city of Austin had the lowest, along with Travis County, had the lowest 

COVID–19 death rate amongst our major Texas cities. Every death 

in our community was a tragedy, and if we had been able to 

achieve that same rate across Texas, we would have 45,000 more 

Texans who would have survived the pandemic. President Biden’s 

vaccination strategy, along with local leaders’ efforts, have kept 

nearly half a million people from being hospitalized. 

I just want to be clear. You cannot fraud your way to these lower 

COVID death numbers. You cannot cook the books and save this 

number of people from losing their homes, or their jobs, or their 

businesses. The hospital beds, the food lines, the morgues do not 

lie. These COVID relief programs did powerful work, even while we 

continue to work to root out any instance of fraud. 

So, what I want to ask our panel here today is that we, of course, 

need to focus on getting rid of fraud, but without telling these stories of success, we could weaponize accountability efforts to undermine these programs that you have said have helped struggling 

Americans. So, in your time targeting fraud, can you give us examples of programs you have looked into that functioned well, served 

the American people with urgency, and ensured that dollars actually got to the people that needed them the most? 

Mr. HOROWITZ. I would say, Congressman, we haven’t heard stories from people that said these programs were a complete waste. 

That is not what we have heard. We have heard success stories in 
50 

many of the programs. We have talked about PPP, and EIDL, and 

the unemployment insurance. Restaurant revitalization program 

helped restaurants. The various state and local funding vehicles 

had a substantial impact. We actually visited six communities as 

part of our oversight work and are working on a report on it to see 

how they used COVID-related funds, what impact it had on those 

communities. And so, we have gone to communities around the 

country to get that information. 

The challenge has been making sure that large percentages of 

that money went to the people it was intended for and went to the 

communities it was intended to help. So, I wouldn’t come here and 

say we heard testimony that these programs were bad. What we 

heard was these programs were helpful, and how do you fix the 

fraud to make sure the money goes to the right place. 

Mr. CASAR. Thank you for that. Yes, of course, you know, helping 

folks out in a mile-long food line, those folks aren’t there committing fraud. But what we are trying to do here is make sure that 

we are recovering dollars that weren’t getting to those folks. 

Mr. DODARO. Yes. No, I agree with what Michael has said. But 

I would also add, you know, Operation Warp Speed, I thought, was 

a very effective program. We were able, working with the private 

sector and government, to develop the vaccines in a record time. 

Normally, it would take 10 to 15 years to develop a vaccine, but 

Operation Warp Speed worked, I think, extraordinarily well. The 

programs have provided funding to help support healthcare workers, providers was very effective as well. But all of these programs 

had some level of effectiveness, but it could have been even more 

effective, is what we are saying. If all the money that was allocated 

was used properly, we could have maybe saved more people, helped 

more people out, and that is our goal. 

Mr. CASAR. Thank you. I think it is our goal as well. I yield back. 

Chairman COMER. The gentleman’s time has expired. The chair 

recognizes Mrs. McClain for five minutes. 

Mrs. MCCLAIN. Thank you, Mr. Chairman, and thank you all for 

being here today. I appreciate it. A little bit of background is, I 

come from the financial services background, and I really want to 

focus on the waste, the fraud and abuse and really to represent the 

American people. 

In my background, if I were to defraud a client, probably two 

things would happen. One, I would have to pay the money back, 

and two, I probably do a little time for that, and rightly so. So, I 

want to really focus on what are the consequences and what are 

the penalties, and then what is the relationship, because if I understand it correctly, it is your job, Mr. Smith, to kind of make a preliminary case and then hand it over to the DOJ. Am I directionally 

correct on my understanding? 

Mr. SMITH. Yes, sir. Yes, ma’am. Yes, ma’am. 

Mrs. MCCLAIN. So, in your testimony, you mentioned that the 

Department has recovered over a billion dollars, which I think is 

a good start. However, we still have $500 billion in potential fraud 

out there that we have just identified, and who knows, there might 

be more. So, I am curious as to how many pandemic fraud cases 

your office has actually referred to the DOJ. Do you know that? 
51 

Mr. SMITH. So, to give you some background, we have opened 

over 5,000 cases since March 2020. We obviously follow the evidence, and once we feel like there is investigative merit, we take 

those cases to the Department of Justice, U.S. attorney’s offices. 

And those U.S. attorney’s offices look at those cases and the prosecutorial merit of those, along with other Federal law enforcement 

entities because it is not just the Secret Service—— 

Mrs. MCCLAIN. Sure. 

Mr. SMITH [continuing]. But other Federal law enforcement entities who are bringing pandemic-related cases as well. They have to 

de-conflict and prioritize. 

Mrs. MCCLAIN. So, let’s stick with that theme because I am trying to get some answers. So, you have over 5,000 cases. How many 

of those have you referred to the DOJ, give or take? 

Mr. SMITH. When we open the case, once we feel like there is 

enough evidence to move forward from a prosecutorial judicial 

standpoint, we present that case to the U.S. attorney’s office. I 

don’t have the breakdown of how many were presented yet. I can 

get that number back to you though. 

Mrs. MCCLAIN. If you could, directionally, do you have an idea? 

Mr. SMITH. When we open the case, the—— 

Mrs. MCCLAIN. Is it a 90 percent accept rate? Is it a 20 percent? 

Mr. SMITH. Well, accept rate is actually different than presentation rate because when we open a case, the intent is to eventually present it to the U.S. attorney’s office. 

Mrs. MCCLAIN. Right. So, I am trying to make the correlation to 

you commit a crime, there is a consequence. And what I am trying 

to do for the American people to help justify for them their tax dollars being misused on fraudulent basis, and I appreciate and applaud your efforts. I am trying to connect the dots on what is the 

number. Directionally, you have no idea. Does the DOJ accept most 

of the cases? Are most of the cases that you find accepted? 

Mr. SMITH. I mentioned in a previous response, so as a Federal 

law enforcement entity, we are, you know, by nature, trying to go 

after the most egregious actors. 

Mrs. MCCLAIN. Sure. 

Mr. SMITH. That is why we train state and locals—— 

Mrs. MCCLAIN. Yes. 

Mr. SMITH [continuing]. In our Computer Forensics Institute 

down in Alabama to focus on a local level, but we are confident in 

our colleagues at the DOJ. They take as many cases as they can, 

and they work—— 

Mrs. MCCLAIN. So, with all due respect, you may be confident, 

but I don’t know if the American people are confident with their 

tax dollars. And I don’t mean any disrespect, but that is why I am 

trying to ask these numbers is to get some answers for the American people. Let me rephrase it. How many of these cases are currently being prosecuted by the DOJ? Do you know that? 

Mr. SMITH. I don’t know that overall number for the Department 

of Justice. I do know that we have made nearly 500 arrests since 

the beginning of the pandemic. 

Mrs. MCCLAIN. OK. So, you have made 500 arrests. What has 

the result of that been? So, I know you have recovered over a billion dollars, right? Any jail time? 
52 

Mr. SMITH. Yes, ma’am. 

Mrs. MCCLAIN. Can you talk to that effect? 

Mr. SMITH. I haven’t compiled the number of years or months 

total from the 500 arrests. I haven’t done that, ma’am. 

Mrs. MCCLAIN. OK, because I do think at the end of the day, just 

like we treat our children, if there is a consequence to your action. 

Mr. Dodaro, you talked earlier about deterrence. Well, part of the 

deterrence process may be actually if we publicly show the American people that we are going after these criminals, these people 

that are stealing American’s hard-earned moneys, and not only are 

we recovering the money, but they are doing time and hard time, 

that might help on the deterrence. So, when can I expect some results or a report? 

Mr. SMITH. Ma’am, I will give you a timeframe on that when I 

get back to the team, but we have been pursuing results since the 

beginning of the pandemic and—— 

Mrs. MCCLAIN. But I would like an accurate accounting of the results, if at all possible, and just to help on a positive note saying, 

listen, we are good stewards of your money. We are trying to get 

your money back. So, with that, I know I am over time. 

Chairman COMER. Right. The gentlelady’s time has expired, but 

feel free to answer the question. 

Mr. DODARO. Thank you very much, Mr. Chairman. So far, according to the data that we have analyzed from the Department of 

Justice, there have been over a thousand people who have pled 

guilty or been convicted. There are over 600 charges pending 

against another 600 people. There have been at least 779 people 

who have been sentenced so far. This is on page 6 of my written 

testimony. The number of people, it has gone from one year probation to 17 years in prison, so the sentences are significant. We have 

a number of individual examples sprinkled throughout our testimony. So, that is a broad accounting at this point. Michael probably has even a more precise accounting. 

Mr. HOROWITZ. Yes, I was going to just build on that. You know, 

there are the numbers. I agree with Mr. Dodaro. Everything is on 

our public website. We post all of the cases that we are as an inspector general community involved in. I couldn’t agree with you 

more. The public needs to know there are consequences. Crime 

doesn’t pay. And what we are going to do as inspectors general, as 

long as that clock is running, and Congress last year extended it 

from 5 to 10 years in one group of cases—hopefully, we will do it 

in others—we are going to keep going. It is going to go for seven 

more years or more, but are going to hold everybody who we can 

hold accountable, accountable. And as inspectors general, we don’t 

care about dollar thresholds. We are going to go after the smallest 

dollar to the biggest. Obviously, you prioritize. We have multiyear 

sentences to date for some people. No one should think they got to 

get-out-of-jail free card, but one of the things that can help, because we are not only talking about fraud, we are talking about improper payments, right, and recovering money. 

And so, that is where one of the things I mentioned earlier—the 

Program Fraud Civil Remedies Act, it is an administrative way we 

can get money back. It is not criminal, but the taxpayers know we 

are getting the money back. Right now the threshold to use, it is 
53 

$150,000. We want to raise it to a million dollars so that we can 

go after that. 

Chairman COMER. Thank you. The chair recognizes Ms. Crockett. 

Ms. CROCKETT. Thank you, Mr. Chair. I have changed my question a little bit, so I am going to go to my roots. As a criminal defense attorney, a lot of times I would voir dire a jury. And one of 

the questions that I would ask is, is it better to convict an innocent 

person or to let a guilty one go free? And oftentimes, the look that 

I am seeing on Mr. Smith’s face is the look that I would get from 

potential jurors because for them, it was an impossible question because neither one of them sounded like a good resolution. And I 

bring this up because what we are talking about is government, 

which happens to be less than perfect. We are also talking about 

a once-in-a-lifetime pandemic. 

And so, what I want to better understand is, I want us to be real. 

I feel like in this hearing we have talked a lot as if we can erode 

all bad guys, make criminals disappear. I believe in the opening remarks from Mr. Dodaro, he talked about the fact that, basically, 

there are those that were sitting and ready to pounce, not necessarily that the pandemic was producing some super criminal all 

of a sudden, but these are fraudsters, many of them who had a 

record. 

When you talk about these sentences, one can presume that the 

higher sentences went with people that most likely had been in 

trouble at some point in time before in their lives, and so I want 

to talk about realistically. Let me first begin by saying, I applaud 

the efforts that all of you have made in your respective areas, to 

make sure that we are doing our part. But I think that what we 

are losing sight of is the fact that we save lives, and there were 

people that were in desperate need. And when we talk about our 

economy and the fact that we are still struggling to recover from 

the pandemic, we minimized some of that. This was a mitigation 

exercise that Congress had. And so, while it may not have been 

perfect, because there wasn’t a playbook for the previous pandemic, 

because I am guessing most of you all weren’t here a 100 years ago. 

I am trying to find out, when you look at it overall, if we wanted 

to be realistic about this imperfect system, if we were to throw out 

percentages of fraud because I know that right now you don’t have 

a crystal ball to know exactly how much fraud has occurred. But 

when we look at, say, other programs that have been rolled out, 

what is a good threshold for what we should anticipate as kind of 

part of the business that we unfortunately may endure when we 

are talking about such a large—government is big. And so, it is 

definitely not perfect. There is a lot of people in it. What are we 

talking about realistically, and how far off of that mark were we 

when we look at these types of circumstances? And it doesn’t matter who answers. 

Mr. HOROWITZ. Yes. Congresswoman, it is an excellent question, 

and I don’t have any precise number I can tell you. I think for all 

of us who have done this for a while, the lack of preparedness and 

the management of the programs at the outset created a much 

larger opportunity for fraud than should have happened. Whether 

that should have been—as you noted, there is always going to be 

fraud in programs where there are some bad people out there who 
54 

will, no matter how much you try, find their way to get the money 

illegally. But I think most of us think that percentage of fraud 

could have been much smaller. 

Ms. CROCKETT. OK. 

Mr. HOROWITZ. And whatever we are going to end up here, had 

there been preparedness and action taken in advance. 

Ms. CROCKETT. OK. 

Mr. DODARO. Part of the framework that we work with Congress 

to put in law back in 2016 requires a fraud risk assessment, a profile, but also a tolerance level for risk. That would be said for every 

individual program. So, you would make a conscious decision up 

front of what you are willing to tolerate in order to have that tradeoff for speed, and getting delivery of services out there as fast as 

possible to save lives, to help deal with economic consequences. 

Right now, it is just whatever happens to us, as a government 

happens to us, and we deal with the consequences. And I have 

been in GAO over 49 years, so we have been a lot of disasters during that period of time: Katrina, and the American Rescue Act, 

during the Great Recession, the $700 billion to unfreeze the credit 

markets during the global financial crisis. In this situation, there 

is more fraud than we have seen in equivalent type of things over 

the years, recognizing that this was the biggest American rescue in 

our history. But had we been better prepared and actually implemented requirements for managing fraud consciously up front, we 

would reduce the amount of fraud and made better use of that 

money to help really achieve the objectives of the legislation. 

Ms. CROCKETT. Thank you. 

Mr. SMITH. As I said in my opening remarks, I always think that 

collaborating and sharing information on the front end will lead to 

some mitigation of criminal behavior. But obviously, my experience 

as a law enforcement professional says, you know, there is always 

going to be some element of criminal activity afoot. 

Ms. CROCKETT. Thank you so much. 

Chairman COMER. The chair now recognizes Mrs. Boebert for five 

minutes. 

Mrs. BOEBERT. Thank you, Mr. Chairman, and thank you so 

much to our witnesses who are here today. I appreciate your time 

and your willingness to be here and speak with us, and answer 

these very important questions. Now, I am going to get right to it. 

Members of Congress have been told that American taxpayers were defrauded a possible $560 billion as a result of the Federal 

Government’s negligence in carrying out these Federal COVID relief funding programs. And I am going to start with a rhetorical 

question here, but does anyone know of an organization in America, or around the world, public or private, that has been scammed 

out of $560 billion, and simply, is that OK? I certainly can’t think 

of one, and I don’t think that it is OK either. So, after what was 

the largest fleecing in American history, possibly world history, can 

any one of the witnesses today give me the name of one administrator, one director, a supervisor that was fired, demoted, or put on 

leave because they failed to keep hundreds of billions of dollars 

from being stolen from the American taxpayers? And I will yield 

very quickly to each of our witnesses for simple ‘‘yes’’ or ‘‘no,’’ and 

I will start with you, Director Smith. 
55 

Mr. SMITH. No, ma’am. That is not my focus. 

Mrs. BOEBERT. Thank you. 

Mr. HOROWITZ. I don’t know that as I sit here. I could ask the 

fellow IGs to see if they know of any actions that have been taken 

from an administrative side. 

Mrs. BOEBERT. Thank you. 

Mr. DODARO. Yes, offhand, I do not. 

Mrs. BOEBERT. Thank you. I didn’t think so, and that is pretty 

insane. Five hundred and sixty billion dollars we are projecting, 

and we have hundreds of billions of dollars lost, causing massive 

inflation. Seventy percent of the money, according to the CEO of 

LexisNexis Risk Solutions, ended up lining the pockets of crime in 

countries like China, Nigeria, Russia, and not a single person in 

charge of distributing that money has been held accountable. 

So, here is how badly the American taxpayer was conned. The 

United States Federal Government has reportedly been defrauded 

of more money in the last two years than the entire 2022 tax revenue of England, Italy, Mexico, Ireland, Greece, Israel, Canada, Poland, and Brazil combined. The American taxpayers have one question: how the heck were these bureaucrats so dang incompetent, 

that they were being scammed out of $35 million every hour for 

nearly two years? Absolutely insane. 

And what is equally concerning is the fact that, for years, Congress has known the size and scope with which the American taxpayer was defrauded, yet this committee refused to act until now. 

Now, the Republicans hold the gavel and in a desperate attempt 

to protect the Bidens, the Big Tech industry, the Democrat Party, 

the mainstream media has tried to discredit this committee before 

our work has even begun. There should be nothing more bipartisan 

than ensuring American tax dollars aren’t stolen by fraudsters, but 

sadly, it has taken a Republic-controlled Oversight and Accountability Committee to be willing to get to work on it. 

So, here we are. The American people had their businesses shut 

down. They lost their jobs, their livelihoods, their life’s work because of government mandates and shutdowns, and that same government spent trillions of dollars, lost hundreds of billions, and the 

result is skyrocketing inflation and interest rates for the American 

people. And our role is to ensure that we find out how this happened and make sure that it never happens again, and hold those 

that stole money from the American people accountable. 

And, Chair Horowitz, I would like to ask you, under the Biden 

administration, we have seen the DOJ wage a full out attack 

against the American people from accusing parents concerned 

about their children’s education of being domestic terrorists, to 

raiding the homes of pro-life activists, to pressuring private companies to censor conservatives. As Republicans have continued to 

mention throughout this hearing, there is a clear difference between people who were issued improper payments versus 

fraudsters who have stolen hundreds of billions of dollars collectively from the American taxpayer with malicious intent. Now, 

Chair Horowitz, what is the Department of Justice doing to ensure 

that the Federal Government is targeting criminals and those who 

knowingly took millions of dollars from the Federal Government to 

fund criminal gangs in Russia, China, and Nigeria? 
56 

Mr. HOROWITZ. So, we have worked with the Department, inspectors general, and the PRAC have worked with the Justice Department on these investigative matters. They have set up a fraud task 

force. We are a member of it with the Secret Service. We have 

worked closely with law enforcement partners across the Federal 

Government. It is going to take a substantial amount of time, effort, and resources because there are so many cases. We have that 

partnership working right now. We are going to continue to refer 

cases to them, and they are going to have to make assessments on 

which cases to bring criminally. We are also working with them on 

the prepayment signed on with the civil lawyers as well because, 

again, we want to get the money back for the taxpayers. 

Mrs. BOEBERT. Yes. Thank you, Mr. Chair. I yield back. 

Chairman COMER. Thank you. The chair recognizes Mr. Goldman 

for five minutes. 

Mr. GOLDMAN. Thank you, Mr. Chairman, and thank you to our 

witnesses for your service and being here today. After that effort 

to blame the victim for fraud by bad actors, let’s first go back to 

the undisputed premise that the money appropriated by Congress, 

including by nearly all of my Republican colleagues on the other 

side during the past 2 Congresses, was both life-saving and economic saving, as we faced the worst pandemic in our history. 

Now, as a prosecutor, I prosecuted rampant mortgage fraud that 

resulted from the subprime mortgage crisis, and we know there 

was significant fraud arising out of the TARP program following 

the 2008 financial crash. But I was shocked to learn in preparing 

for this hearing that many of the COVID benefits or at least some 

of them were available based on a self-certification process. Am I 

correct, Mr. Horowitz, that that means that individuals could receive COVID relief funds simply by certifying their eligibility without any independent review? 

Mr. HOROWITZ. That is correct. 

Mr. GOLDMAN. Now, would you agree—Mr. Horowitz as also a 

former Federal prosecutor and current IG of DOJ—that is self-certification process is a recipe for fraud? 

Mr. HOROWITZ. Absolutely. 

Mr. GOLDMAN. I read your opening statement closely, and I appreciate very much your call for more resources for data and data 

analysis, which, in my experience, is the most effective way of rooting out identity theft, unquestionably the biggest cause of COVID 

fraud, as well as most other frauds. Mr. Horowitz, in your view, 

has the Department of Justice received enough money to prosecute 

fraud related to COVID relief funds to the very fullest extent? 

Mr. HOROWITZ. I think that is going to be a question over time 

because they are ramping up dramatically as we are, and as Secret 

Service is, and others. They will need additional resources, particularly this year and in the coming years, to deal with what I think 

will be a continued, you know, a substantial number of cases. 

Mr. GOLDMAN. So, you would certainly agree that the Department would benefit from more funds for COVID relief fraud? 

Mr. HOROWITZ. I believe they will need that this year and in the 

years to come. 

Mr. GOLDMAN. I want to ask you to switch your hats now back 

to the inspector general for the Department of Justice, and I am 
57 

going to direct your attention to a recent New York Times article 

entitled, ‘‘How Barr’s Quest to Find Flaws in the Russia Inquiry 

Unraveled,’’ which is dated January 26, 2023. Did you read this 

lengthy article last week, Mr. Horowitz? 

Mr. HOROWITZ. I did read it. 

Mr. GOLDMAN. OK. Mr. Chairman, I ask for unanimous consent 

to introduce this article into the record. 

Chairman COMER. Without objection, so ordered. 

Mr. GOLDMAN. Now, this article is based on a month-long investigation by the Times exposing a tremendous amount of waste and 

abuse, but no fraud by Special Counsel John Durham, who was assigned by former AG Bill Barr to investigate the origins of the Russia investigation under a false conspiracy theory. Mr. Horowitz, you 

released a report on that exact topic, didn’t you? 

Mr. HOROWITZ. We released our report about the handling of 

Crossfire Hurricane and the FISA matter in December 2019. 

Mr. GOLDMAN. And Crossfire Hurricane, just to be clear, became 

the Special Counsel Mueller’s investigation, right? 

Mr. HOROWITZ. What has been referred to colloquially as the 

‘‘Russia investigation.’’ 

Mr. GOLDMAN. Right, and you concluded that the initiation of a 

full Russia investigation by the FBI was legitimate and supported 

by the evidence. Is that correct? 

Mr. HOROWITZ. I would want to go back and find the exact words 

I used in that report, but we did not find evidence of inappropriate 

decision-making in that regard. But again, I would want to use the 

precise language I used in that report. It is public. It is on our 

website. 

Mr. GOLDMAN. OK. And you referred one case to Special Counsel 

Durham, correct? 

Mr. HOROWITZ. That is correct, and attorney, Mr. Clinesmith, 

who we found had altered a document. 

Mr. GOLDMAN. And he pled guilty, and other than that case, do 

you know how many cases Mr. Durham charged? 

Mr. HOROWITZ. As to what is public, I have no idea if there is 

anything under seal. I am assuming not, but I don’t know the answer to that. There are two public cases beyond that. 

Mr. GOLDMAN. And how many convictions did he get? 

Mr. HOROWITZ. Other than the Clinesmith case, the other cases 

were—the juries has found the individuals not guilty. 

Mr. GOLDMAN. Mr. Horowitz, last night, Congressman Ted Lieu 

and I sent you a letter requesting that you conduct an investigation 

into Special Counsel Durham’s investigation to see if Mr. Barr or 

Mr. Durham violated any department policies, regulations, or law. 

Have you reviewed this letter yet? 

Mr. HOROWITZ. I was not aware that you had sent that until you 

just showed it to me, but I certainly will read it and review it. 

Mr. GOLDMAN. Mr. Chair, I would ask for unanimous consent to 

offer into the record, and could I just add—— 

Chairman COMER. Without objection. The gentleman’s time has 

expired. 

Mr. GOLDMAN. Mr. Horowitz, can you just commit to right 

now—— 
58 

Chairman COMER. Gentleman’s time has expired. We appreciate 

the questions on COVID and appreciate the passion for investigations. We will get to that in the next few weeks, but thank you for 

the questions. The chair now recognizes Mr. Fry for five minutes. 

Mr. FRY. First, Mr. Chairman, thank you for holding this hearing 

today. Thank you to the witnesses for being here. I am going to 

highlight an example of COVID fraud in my very own district. Just 

last year, two members of a Myrtle Beach family were sentenced 

in Federal prison and a third to probation for their roles in a 

scheme to defraud the government out of more than $500,000 

through a series of fake tax returns and stealing stimulus checks 

sent to other Americans under the CARES Act. While many people 

are struggling to make ends meet during the pandemic, these 

criminals went on a shopping spree with money stolen from the 

American people. You know, while I am a Member of Congress, I 

am also a resident of that district. This is in my very own community, so I want to thank you, Chairman for holding this because 

this also touches home as it does for many Americans. 

I would imagine, Mr. Smith, that this is by no means the only 

place that this is happening. Can you talk about or touch on similar instances that are occurring around the country from a factual 

standpoint? 

Mr. SMITH. Yes, sir. While we talk somewhat about transnational 

criminal organized groups, our experience in the 5,000-plus criminal investigations that we have opened is overwhelmingly, you 

know, homegrown actors. You talked about your home district, 

Myrtle Beach. Our Columbia, South Carolina Field Office is one of 

our most active field offices, especially when it comes to employing 

taskforce partners. They actually won the cyber games that were 

hosted by the National Computer Forensics Institute last year. So, 

we do have a lot of capacity, a lot of law enforcement passion in 

your district. 

But as you mentioned in your question, that is a similar footprint 

that exists in our other cyber fraud task forces, the 41 other ones 

around the country. And what we do is employ not just agents with 

guns, but analysts and other professionals that collaborate together 

with those financial institutions, with those local banking communities and local law enforcement professionals to, you know, detect 

and arrest bad people. 

Mr. FRY. Thank you, and I know you touched on how you are investigating some of these actions, but can you touch on how you 

are identifying new cases of fraud or abuse moving forward? 

Mr. SMITH. So, early in the pandemic, as I mentioned in my 

opening, we partnered with the Department of Labor, OIG, and 

SBA OIG, and we assigned MOU, Memorandum of Understanding, 

where we shared information, shared anomalies, shared indicators 

of compromise that lead us to bad actors. I mentioned earlier how 

we talked to a lot of money mules. We follow money, and once you 

follow money and what accounts that those resources went into, 

generally speaking, you are going to get to the bottom of a crime 

because overwhelmingly, our investigations focus on folks that are 

looking to enrich themselves through illicit activity. So, once you 

start knocking on doors, asking questions, and looking into bank 
59 

accounts, you usually got to get some answers from a law enforcement perspective. 

Mr. FRY. Thank you. Mr. Dodaro, once an improper payment has 

been made, how difficult is it to recoup that money? 

Mr. DODARO. Well, it is important to recognize that the improper 

payment estimates are estimates and projected, but when they are 

found, it is always difficult to recover the money. I think in the last 

two years, there have been improper payments of over $200 billion. 

Recoveries have been about $20, $23 billion. 

Mr. FRY. So 10, 12 percent-ish? 

Mr. DODARO. Yes. 

Mr. FRY. I mean, in this instance, would you agree that improper 

payments are not always recoverable? I mean, you are going to run 

into a brick wall? 

Mr. DODARO. Absolutely, and you are going to have the same 

issue with fraud. 

Mr. FRY. Out of all the improper payments that had been made, 

and I know you have collected $23 billion back, how much can we 

realistically expect to recover? 

Mr. DODARO. That has been about the consistent number that I 

have seen over time. The main thing I have been trying to do and 

convince Congress to have some legislation to do this and oversight, is the stop the improper payments in the first place. The 

same with fraud. Unless you prevent this from happening, the 

prospects of recovering this money over a period of time are pretty 

slim, based on historical evidence. 

Mr. FRY. And I am going to ask this to you and direct to my final 

question. Is it possible from a strategy standpoint to enlist the help 

of states either incentivizing it or whatever to broaden that perspective? Is that a decent policy initiative to look into? 

Mr. DODARO. Absolutely. I have been trying to convince each administration I have worked with the use the state auditors more 

effectively in that area, Medicaid program in particular. The Medicaid program alone in the last two years has had $98 billion and 

$80 billion in improper payments. State auditors could help greatly. State auditors could help in the unemployment insurance area, 

and auditing the Federal Government, they ought to support state 

auditors, and they can use them to hold people more accountable 

for third party deliveries. 

Mr. FRY. Thank you. I yield back. 

Chairman COMER. The chair recognizes Mr. Moskowitz for five 

minutes. 

Mr. MOSKOWITZ. Mr. Chairman, thank you, and thank you for 

holding this hearing today on Pandemic Response, Waste, Fraud, 

and Abuse. I think we can agree on a bipartisan basis that, of 

course, we want to find out about waste, fraud, and abuse because 

in the emergency management business, one of the things we do 

after a disaster is we do after action reviews, and we look at what 

went right and what went wrong to not repeat those same mistakes. 

And so, when the country began—you know, we are facing an unprecedented whole-of-country crisis, the first 50-state disaster in 

American history. Every state had a disaster declaration. At the 

same time, the Trump administration was ill prepared and, in fact, 
60 

several times wanted the states to take the lead instead of the Federal Government, specifically when it came to PPE. And so, we 

have heard a lot about fraud and abuse today. 

I want to focus on the waste. It is not as sexy as fraud and 

abuse, but the amount of waste that happened during the pandemic, especially in the PPE space, is something that I want to discuss. You know, that void that was created when the states had to 

step up and procure all these resources. The states had to compete 

against everybody but Antarctica, but, most importantly, the Federal Government. And while the Federal Government was raising 

prices, companies were price gouging the Federal Government, 

while the Federal Government was not following their own procurement. In fact, $18 billion was spent by the Trump administration 

procuring these goods. Ten billion dollars of that did not go through 

procurement. It was sole-sourced contracts. 

And so, one of the things I want to talk about as the former director of emergency management for the state of Florida for Governor DeSantis is, and this question is for you, Mr. Horowitz. Did 

the Inspector General’s Office ever look at anyone within the inner 

circle at the White House on whether they were involved in specifically selecting vendors and negotiating pricing for PPE? 

Mr. HOROWITZ. So, each inspector general has authority by law 

in the IG Act over the employees in their building, in their agency. 

We do not have authority to investigate individuals outside, and 

there is no inspector general for the Executive Office of the President or the White House. 

Mr. MOSKOWITZ. OK. I appreciate that. So, let’s switch over to 

the GAO then. Has the GAO examined whether anyone within 

Trump’s inner circle, including family members, were involved in 

decisions on who should get what contracts and the $10 billion that 

didn’t go through procurement, and the pricing that was paid for 

all sorts of different PPE, whether that be masks or ventilators? I 

mean, trust me, I have read all of the stuff, but I just want to 

know, did you guys specifically look at any of that? 

Mr. DODARO. No, we did not. 

Mr. MOSKOWITZ. OK. So, what if I proffered for you that when 

states could not get this PPE out of FEMA or out of HHS, that we 

had to call the White House to get this stuff released directly from 

his inner circle? What if I proffered for you? Would that sound like 

normal procurement process during an emergency? 

Mr. DODARO. Probably not. 

Mr. MOSKOWITZ. Right. So, you know, one of the questions that 

I think we should focus on, Mr. Chairman, in this hearing is that 

COVID was not a two-year event. It was a three-year event. And 

I am more than happy to join with the majority and look at the 

fraud and abuse that went on in the last two years in COVID-related programs, but I think it is only fair for us to also look at the 

beginning of the disaster and the amount of government waste that 

existed by the Federal Government sole sourcing contracts and negotiating pricing within the White House subverting the process 

from Federal agencies, because not only did that drive up cost and 

waste. That filtered down to the other 50 states because if the Federal Government was paying more money, and if I wanted to buy 

those supplies, I had to pay more money. So, it isn’t just the $18 
61 

billion that was spent here. It is the money now that FEMA has 

to reimburse those states for goods that were too expensive because 

the Federal Government drove up those prices. I yield back. 

Chairman COMER. The chair recognizes Mrs. Luna for five minutes. 

Mrs. LUNA. I just want to thank the chairman and all of the witnesses for participating, and I know it has been a long day, so I 

will try to keep this short. 

COVID improper payments continue to be an area of concern in 

the Federal Government due to lack of oversight from the Biden 

administration, as Representative Boebert had stated. Estimates 

range as high as $560 billion of government COVID spending was 

subject to fraud, waste, and abuse. That is our hard-earned taxpayer dollars that could have been used to feed families, heat 

homes, and fill up the pump during the Biden-caused inflation crisis. 

President Biden continued to approve COVID spending with no 

guardrails in place to make sure that money was going where it 

was intended to go. We have seen the Federal Government spending and distributing to illegal immigrants, the same illegal immigrants, mind you, that did not take or pass the health screening 

process for legal immigrants to come here. And in addition to that, 

they did not pay into our taxpayer system. I would like to submit 

the graphic into record. 

[Chart] 

Mrs. LUNA. We can see that the city of Chicago is sending $71 

million for financial assistance for underserved communities, such 

as undocumented residents. The state of Washington is handing 

out $340 million in grant payments for immigrants or illegal immigrants who are not otherwise eligible for Federal stimulus. And the 

city of Boston is sending $1 million in direct cash transfers to legal 

immigrants, who are unable to receive Federal COVID benefits. 

This rewards a dangerous process incentivizing people to come here 

illegally where some estimated that a shocking 60 percent of LatinAmerican children, who crossed the border largely because they are 

seeking the American Dream and understand some of the benefits 

people offer in this country are caught by cartels, exploited for 

child pornography, and drug trafficking. These are not cherrypicked facts or distorted figures. This is actually happening. 

My question is for Mr. Horowitz. If illegal immigrants are prohibited from Federal public benefits, then why are they allowed to receive Federal COVID dollars from programs like the American Rescue Plan? 

Mr. HOROWITZ. So, I would have to go back and look at, you 

know, each program and what eligibility determinations were 

made, and who was eligible, and I am happy to follow up with you 

and provide information to you. We are looking at anybody who is 

ineligible. Frankly, we don’t break it down between the categories 

of as to why, so we are looking for people who are ineligible. We 

are working with our law enforcement partners on that, whether 

you are here legally, not here legally, you really own the business, 

or you never owned a business. You know, we are going to follow 

up and pursue that. 
62 

Mrs. LUNA. Before I yield back my time, real quick, I just want 

to put out there that obviously being a part of Oversight, we want 

to ensure that our taxpayer dollars are being safeguarded, right? 

But also, that government funds are not being used to largely 

incentivize and hurt people in the process. And so, just to finalize 

and maybe just your personal opinion, do you believe that because 

of this type of inappropriate spending, that it is putting people in 

harm’s way that would potentially not be subject to this victimization? 

Mr. HOROWITZ. So, you know, as I said earlier, I don’t think we 

have heard testimony that these programs weren’t helpful to individuals. In fact, for many of them, like the PPP Program, we have 

heard from small businesses that it saved them. For restaurants in 

the restaurant revitalization program, for unemployment insurance, we heard testimony about how it kept people afloat during 

this period. So, we haven’t heard testimony that the programs were 

a waste and useless. 

What we heard was there was a lack of preparation to issue the 

benefits. It resulted in fraud, a lot of identity fraud, and what we 

have heard is how it victimized not just the public who lost the 

benefit of these programs to wrongdoers, it harmed the person 

whose identity was stolen. That individual has to deal with that, 

and it often harms the individual who is intended to benefit because they often struggle to get the benefits because the fraudster 

got there first—— 

Mrs. LUNA. Thank you. 

Mr. HOROWITZ [continuing]. And the program said they were the 

fraudster. 

Mrs. LUNA. Thank you. And now before I leave, Chairman, would 

you please submit the graphic for record? Thank you. 

Chairman COMER. Without objection. 

Chairman COMER. And thank you for your questions. Just to 

note, they just called floor vote. We are going to get two more questioners in, then we will recess and reconvene 10 minutes after 

votes. There are only two votes, and we move a lot quicker than 

Pelosi did, so the recess won’t take long. But now, the chair recognizes Mr. Connolly for five minutes. 

Mr. CONNOLLY. I thank the Chair, and I welcome Mr. Dodaro. 

Mr. Horowitz, welcome back. Mr. Smith, welcome to the committee. 

My questions are going to be to you, Mr. Dodaro, and you, Mr. 

Horowitz. On Monday, the Pandemic Response Accountability Committee, led by you, Mr. Horowitz, released a fraud alert that found 

fraudsters used nearly 70,000 questionable Social Security numbers to obtain as much as $5.4 billion from SBA’s paycheck protection program. Is that correct? 

Mr. HOROWITZ. That is correct. 

Mr. CONNOLLY. And the fraud could have been stopped if the 

Federal Government invested in appropriate data analytics capacity and focused on sharing that data across agency silos and among 

various levels of government. Is that fair assessment? 

Mr. HOROWITZ. That is correct. 

Mr. CONNOLLY. Would you agree with that, Mr. Dodaro? 

Mr. DODARO. Absolutely. 
63 

Mr. CONNOLLY. So, based on previous conversations, we have 

about improper payments and trying to curb that, which this committee has been talking about for a long time, and has been a highrisk category for GAO for a long time as well. I introduced the Stop 

Fraud Act, that in fact, would, by statute, do just that. It would 

have used data analytics and would have propagated that data 

analytics information sharing across Federal agencies, a desirable 

goal that could very well have curbed or prevented the fraud we 

are concerned about. And the bill would also create a center of excellence to look at best practices and to try to assist other agencies 

in achieving those goals. Unfortunately, not a single Republican cosponsored that bill, today’s hearing concern notwithstanding. 

So, I would invite the Chairman, Mr. Comer, maybe to take a 

second look at the Stop Fraud Act, and maybe we can, as he indicated yesterday his desire and the desirability of cooperating on a 

bipartisan basis. I do think Stop Fraud Act has real bipartisan potential, and I would welcome Mr. Comer joining me in that effort, 

but I do think that there are steps we can take, and could have 

and should have taken that might have made a difference. Mr. 

Dodaro, would you like to comment on that? 

Mr. DODARO. I have since 2015 recommended the permanent creation of a data analytics capacity to support the IG community. It 

has proven value, and I was very disappointed that the Treasury 

Department did not pick up that option that Congress gave them 

to take over the Recovery Operations Center’s existing capacity, 

and I was also disappointed that Congress didn’t act on my recommendation back in 2015. 

Mr. CONNOLLY. Right. 

Mr. DODARO. But better late than ever, and so, I hope that Congress does pass that. I think it will have tremendous proven value 

and return many more dollars than the investment, but it has to 

be made permanent so it is ready to go any time. 

Mr. CONNOLLY. Yes, absolutely. Mr. Horowitz, would you like to 

comment on that? 

Mr. HOROWITZ. I would just say ditto at some level, but I would 

remind, as you know, and remind Congress, the law was created 

with tens of millions of dollars in taxpayer money. It was very effective. It went away in 2015. We had to start from scratch in 2021 

with a new appropriation from Congress and more money. We not 

only wouldn’t have had to do that, but I bet we would have found 

some wrongdoing, fraud, and other recoveries in that intervening 

five years between the two disasters because there were other disaster relief programs. 

Mr. CONNOLLY. And I guess the final point I would pick up on, 

and you testified to this earlier Mr. Dodaro, it is the culture too. 

What is rewarded. You know, what is rewarded is pushing money 

out the door, and funding programs, and having metrics that show 

many people you have helped to reach all worthwhile goals. But 

what is not really rewarded comparably is, and when I say $4 billion, I avoided fraud, I took measures to make sure it couldn’t happen. And we have to change that culture, and I am hoping this 

piece of legislation is a big step in that direction, but I think your 

point is very well taken. And I yield back. 
64 

Mr. DODARO. Yes. And actually, the other culture that has to be 

corrected, if I may, Mr. Chairman? 

Chairman COMER. Go ahead. 

Mr. DODARO. Is to make it clear to agencies’ management for the 

programs, that prevention of fraud is their responsibility. It is not 

just the auditors coming in later, the investigators, Secret Service, 

or whoever, because unless it is prevented up front, it is not really 

going to be totally successful. We will always need to have investigations afterwards, but unless that culture shifts to the agencies’ 

management and Congress holds them accountable, you are not 

going to really be as successful as we all want to be. 

Chairman COMER. Thank you. And before we yield back, I would 

like to comment. We are going to hold these agencies accountable. 

That day starts today. I ask unanimous consent to enter into the 

record a letter from the inspector general of the Social Security Administration, dated January 31, 2023. This letter describes various 

activities that that office has undertaken with respect to COVID 

fraud, notably in relation to the misuse of social security numbers, 

which is an issue at the heart of what you all have discussed today 

in many COVID fraud schemes. This letter also points out that the 

Social Security IG has never dedicated funds for oversight. He has 

never received dedicated funds for oversight. This is another step 

Democrats could have taken in the American Rescue Plan, but 

chose not to. 

So, without objection, I will enter this into the record. 

Chairman COMER. Our last question before recess, Mr. Fallon 

from Texas. 

Mr. FALLON. Oh, thank you, Mr. Chairman. Mr. Horowitz, we are 

hearing a lot of testimony, and would it be fair to say that we are 

talking about billions of dollars in fraud? 

Mr. HOROWITZ. Correct. 

Mr. FALLON. It could be tens, it could be hundreds of billions of 

dollars. The facts matter. I think we are discussing the largest case 

of fraud in the history of the United States, and, frankly, this 

might be the largest case of fraud in human history. As we have 

known about these extremes since early 2021, and it is absolutely 

an embarrassment to this institution, to the executive branch, to 

all the Federal Agencies involved. 

The U.S. Government has been swindled by not only our own 

people, but criminals in Russia, in China, Romania, and Nigeria, 

to name a few. It is estimated that 40 percent of pandemic unemployment assistance funds, about $4 billion of taxpayer money 

went to criminal organizations and authoritarian regimes, like Russia and China. Just put this into perspective, according to the 

World Bank, there are 194 recognized countries on earth, and 171 

of them don’t even have annual GDPs that rise to that level of 

$560 billion. To add insult to injury, Democrats did not hold one, 

not one full committee hearing on oversight last Congress on 

COVID–19 fraud, which begs the question, what is this committee 

even for? Quite frankly, it is for a hearing just like this when a potential amount of $0.5 trillion has been stolen. And what did the 

Democrats do instead of investigating rampant COVID fraud? They 

used the reconciliation process to ram through $1.9 trillion of 

spending in the form of the American Rescue Plan Act that contin-
65 

ued to fund broken programs we knew were systemically fraudulent. 

So I ask again, what did the Democrats do for two years in oversight instead of investigating the largest fraud in history? Well, 

they held hearings on the dangers of flea and tick collars for pets, 

whether or not the Postal Service could handle packages during the 

holidays, the developments in state cannabis laws, and potential bipartisan reefer reform. They made villains out of CEOs of the critical and essential American energy sector, who are the most effective and most efficient in the world at extracting natural resources. 

In fact, they help guarantee our national security. 

So, I wonder if Democrats considered if their massive spending 

and barring Federal land leases and permits for drilling had anything to do with the 40-year high in energy prices we have seen. 

They held hearings on protecting the free speech of environmentalist activists and others that agree with them, while at the 

same time celebrating censorship of those who didn’t share their 

views. And get this: they hosted two depositions, one roundtable, 

and one full committee hearing on the Washington Redskins, or 

Commanders rather they are called nowadays, and why? Because 

somebody had a bee in their bonnet about Daniel Snyder. 

We had hearings to tell us believe it or not that pollution is racist. The weather, racist. Climate change, racist. COVID–19 by definition, an indiscriminate virus was racist. Material healthcare, you 

guessed it, racist. And America itself, the land of opportunity and 

prosperity where millions of people come to this country every year, 

both legally and illegally, to live their dream, many Democrats told 

us for two years that America is systemically and irrevocably racist, that white privilege runs amok. Fortunately, the hard data 

proves this leftist talking point to be categorically false, and the list 

of useless hearings goes on and on. Plain and simple, the last few 

years were an egregious dereliction of duty and a waste. 

So, Mr. Chairman, it is with tremendous delight and relish that 

I see this committee actually and actively tackling serious matters 

of import to our country and our citizens, like, for instance, criminal transnational organized crime, stealing $0.5 trillion from the 

American Treasury, and, by extension, the American taxpayers, 

very pockets. So Mr. Chairman, thank you very much, and I yield 

back. 

Chairman COMER. Thank you, gentleman. We are going to now, 

without objection, go into recess, and we will reconvene 10 minutes 

after the last vote. We only have two votes, which won’t be long. 

I know we have about eight or nine more questioners and then a 

second panel. So, without objection, we are in recess until 10 minutes after conclusion of the last vote. 

[Recess.] 

Mr. LATURNER.[Presiding.] The committee will come back to 

order. 

The chair recognizes the gentleman from California, Mr. Khanna. 

Mr. KHANNA. Thank you, Mr. Chair. You know, we have a tendency in this place to always run down everything Congress does or 

that Washington does. I would submit that our response as a Nation to the pandemic is one of the most extraordinary responses on 
66 

a bipartisan basis that this country has ever had. We had 22 million people out of work with the pandemic. Most other nations 

around the world followed austerity politics. They didn’t have 

enough aid. We spent, on a bipartisan basis, $5 trillion to make sure that 

millions of people got back to work, to make sure that we have a 

3.5-percent unemployment rate, not a 10-percent employment rate, 

to make sure that we didn’t have a depression in this country, to 

make sure that 6 million people didn’t go into poverty. That was 

what unemployment insurance extension was about. 

We voted not because it was going to help red states or blue 

states. We voted because it was going to help the United States of 

America. And we learned the lesson of the Great Recession that the 

stimulus then, which the Republicans opposed, was actually too 

small, that we needed to go bigger, and the person who realized 

that was not just the Republicans. It was Donald Trump. Threepoint-three trillion dollars of the spending we are talking about 

was Trump oriented spending. 

My first question to you is, what percent of fraud are we talking about on the $5 trillion? Is it less than two percent, three percent? 

I mean, what percent are we talking about? 

Mr. HOROWITZ. Congressman, at this point, I am not in a position to tell you—— 

Mr. KHANNA. Ballpark. 

Mr. HOROWITZ. I have no idea at this point. 

Mr. KHANNA. You don’t know? Is it less than 50 percent? 

Mr. HOROWITZ. It is less than 50 percent. 

Mr. KHANNA. Is it less than 10 percent? 

Mr. HOROWITZ. There are some programs. I am not sure 

where—— 

Mr. KHANNA. Overall. Are you saying there is a possibility? 

Mr. HOROWITZ. We have a lot of investigating going on, so I am 

not going to make a guesstimate when I don’t really have—— 

Mr. KHANNA. Does anyone have a sense if it is less than 10 percent, five percent? You have no idea what percent? 

Mr. DODARO. There are still hundreds of cases that are being investigated, so we—— 

Mr. KHANNA. So, let me ask this. Is there any evidence that the fraud is higher on the $1.8 trillion that was allocated under President Biden’s Rescue Plan as opposed to the $3.3 trillion that President Trump signed off on the CARES Act? There is no evidence of 

that, right? I mean, the fraud was equally applicable, potentially, 

to the $3.3 trillion as the $1.8 trillion. Is that a fair statement? 

Mr. DODARO. I would say that is a fair statement. 

Mr. KHANNA. And Mr. Horowitz? 

Mr. HOROWITZ. Yes. 

Mr. KHANNA. Mr. Smith? 

Mr. SMITH. The breakdown of our criminal investigations is 

roughly 45 percent UI based and the other 55 percent SBA, but 

that is just a Secret Service context, just to give you what we have 

opened up. 

Mr. KHANNA. Yes, but the UI was extended under the CARES 

Act when President Trump was President. And by the way, the 

Democrats objected back then to a lot of the deregulation on SBA 
67 

and a lot of the deregulation and how that was administered. But 

I just want to be clear because they are trying to imply that somehow this fraud, which, in my view is, is less than 2 to 3 percent, 

I mean, you can’t say it, but even if you think that the fraud, it 

was $100 billion, that is still less than a couple percent of the total 

spending. They are trying to imply that somehow President Biden 

is to blame for that, and that you would agree is just not factual, 

correct? I mean, you can’t blame President Biden and not blame 

President Trump with $3.3 trillion of it was under Trump. Is that 

correct? 

Mr. DODARO. I mean, we are looking at the totality of the programs from 2020 to current day, and we are finding problems 

across that whole spectrum. 

Mr. KHANNA. Mr. Horowitz? 

Mr. HOROWITZ. Yes, the fraud began in March 2020. We are looking at fraud cases throughout. Most of the money went out in the 

earlier periods of time, but there is fraud throughout. 

Mr. KHANNA. It is a great point. Most went out earlier. So, if 

anything, the Trump administration probably is more to blame for 

that three percent of the fraud. Let me ask this to Mr. Dodaro. One 

of the challenges has been the antiquated IT systems in many of 

these states prior to the pandemic, and this is actually one of the 

challenges with the unemployment claims. Could you compare Republican led state performances on these IT systems versus Democratic states or talk more generally about these IT systems? 

Mr. DODARO. Well, I can talk generally. We didn’t look at it that 

way. We don’t look at things on a partisan basis. But the IT systems, some of them date back to the 1970’s, from what we understand, and efforts were made to try to modernize them. You know, 

we keep a list of the highest risk areas. This is at the Federal level 

for the Federal Government. IT acquisitions and operations on the 

high risk list government wide for the Federal Government. 

At the state level, they were having similar problems, and that 

contributed to their inability to detect some of the fraud. They 

weren’t able to do matching on some cases in some of the larger 

states, and with the volume of claims that came through, they 

needed to have automated processes. And some states, they were 

doing it manually, you know, visually just trying to—— 

Mr. KHANNA. That was one of the big reasons for the fraud, correct? 

Mr. DODARO. That was a contributing factor, yes. And the other 

contributing factor was self-certifications, and self-certifications, I 

think was one of the biggest contributing factors were, you know, 

the people could just say, I’m eligible for this program. In some 

cases, they weren’t allowed and not required to submit supporting 

documentation, so he just said it, take people word for it, and that 

is a prescription for fraud. 

Mr. LATURNER. The gentleman’s time has expired. The chair recognizes the gentleman from North Carolina, Mr. Edwards. 

Mr. EDWARDS. Thank you, Mr. Chair. This is working now. Gentlemen, thank you so much for being with us this afternoon. And 

I have got to tell you, sitting here and watching you be still for as 

many hours as you did at our age, is a real test of stamina, so you 
68 

have my respect. You are going to have to tell me how you do that 

some time. 

I want to shift gears just a little bit. We talked about fraud, and 

waste, and abuse quite a bit. I would like to turn the conversation 

if we may, just for a couple of minutes to government efficiency. 

Through the pandemic, I have observed across all industries, because of the loss of work force, and we could get into the reasons 

for that. That is a whole series of hearings, I am sure. But every 

industry that I talked to seems to have been forced to reinvent 

itself through the pandemic and now that the pandemic is coming 

to a close. And by reinvent itself, I am talking about doing more 

or the same job with fewer people. And serving as an appropriations chair for the state of North Carolina immediately before I got 

here, it occurs to me, because every state agency that was coming 

to me asking for their appropriation for the following year was asking for more, not less. And I am just curious what you might be 

seeing, or are you in a position to comment on, has government 

been able in any way to reinvent itself. 

This Congress is on the cusp of having to make some really critical decisions to raise the debt limit to change our spending trajectory. And I would like to know that government is working as hard 

to reinvent itself and do more with less just like every other industry out there is doing. Do you have any evidence or commentary 

on that observation? 

Mr. DODARO. I don’t know if I put it in the category of reinventing itself, but for 11 years now, I issued an annual report to 

the Congress on overlap, duplication, and fragmentation in the 

Federal Government, and how to achieve cost savings and perhaps 

revenue enhancements, and we have issued almost 1,300 recommendations over that period of time. About half of those recommendations have been fully implemented, some partially implemented. To date, there have been financial benefits to the government of over half a trillion dollars, and I think $565 billion. So, 

there are efforts underway, and there are hundreds of other GAO 

recommendations we haven’t opened yet, that haven’t been implemented, that could save tens of billions of additional dollars. 

Right now, we probably have around 5,000 recommendations implemented. I will be issuing that report again this spring. And we 

also have the high risk list that I have referenced earlier in areas 

that need a transformation, and that program over the last 15 

years has saved $675 billion. So, there are improvements being 

made. They are difficult to effectuate, but there is much more that 

could be done for government to do that, and I think congressional 

oversight has been key where there has been progress. It has been 

through congressional action for the big dollars. 

Mr. EDWARDS. Thank you. I will be waiting on that report. That 

will be my favorite read this spring. One other quick question. I 

know from chairing oversight of unemployment in North Carolina, 

the Federal Government had this process where they came back 

and asked for unemployment funds that had already been appropriated through a process called sequestration. Are you familiar 

with that, and if so, can you tell me nationwide how many dollars 

were sequestered? And of that, how many were actually recollected 

from the state? 
69 

Mr. DODARO. Yes. I am not familiar specifically with the Unemployment Insurance Program. The only sequestration I am familiar 

with was due to the Budget Control Act of 2011, and by there, the 

Congress set limits on discretionary spending. And if the appropriation bills didn’t come down to those levels, there was an acrossthe-board government cut to bring them down to those levels. That 

happened in 2013 and 2014. That was like the equivalent of, if my 

memory serves me right, about seven percent cut at that time. 

Mr. LATURNER. The gentlemen’s time has expired. 

Mr. EDWARDS. Thank you very much. 

Mr. LATURNER. The chair recognizes the gentlelady from New 

Mexico, Ms. Stansbury, for five minutes. 

Ms. STANSBURY. Thank you, Mr. Chairman, and ranking member, members of the committee. And of course, gentlemen, on the 

panel, thank you for your time today. I want to take this opportunity at the start of this Congress and this committee’s first hearing to say how honored I am to serve on this committee and to join 

in the oversight of this committee’s work. As a New Mexican and 

as an American, I am deeply proud to serve our country and to 

serve our communities, and to serve under the leadership of our 

ranking member in particular, Mr. Jamie Raskin, who is a hero 

and a scholar here in the House. 

Our job on this committee is to defend our democracy and our 

basic institutions, to protect our rights as Americans, and as a 

member of the truth squad on this side of the aisle, to hold our government accountable, and counter the lies, conspiracy theories, and 

extremism that we are going to hear on this committee this Congress. In a couple of words, we are here to fight for the American 

people and for the people of New Mexico, which is where I was 

born and raised. 

And in fact, I am grateful for this discussion today, because as 

a native New Mexican and as somebody who grew up in a working 

family that struggled to make ends meet with a single mother, I 

personally know what it means to live on the edge, and why critical 

relief programs, like the programs that we are talking about here 

today in this committee, were passed by this body to help millions 

of Americans, who would have fallen through the cracks, as we saw 

in previous economic disruptions. 

In fact, the early relief programs, whether that is the insurance, 

the PPP Program, the subsequent American Recovery Plan, literally saved lives. Let me say that, again, these programs saved 

lives. In fact, in New Mexico, almost 93,000 New Mexicans received 

unemployment insurance. When the pandemic began, I was serving 

in the state legislature. We called thousands of New Mexicans in 

my district to find out how they were doing welfare checks: elders 

who were stranded in their homes without access to healthcare, 

people whose family members had died, people who were unable to 

get food and water, especially in our rural and tribal communities. 

These programs were designed to save lives and to keep individuals 

from falling into the free-fall of economic disaster during a pandemic. 

We know there was fraud and abuse. There is fraud and abuse 

wherever there are humans who take advantage of systems that do 

not have proper oversight. I know a lot about oversight. I used to 
70 

work in the Office of Management and Budget in this government. 

I was a Senate staffer, I conducted financial oversight. I know what 

that looks like. And I have never seen more financial fraud and 

abuse of this system than I saw in the previous administration 

under Donald Trump in which financial systems were abused, including by his cronies and fraudsters who were involved in his administration and his friends across the country. And our job is to 

make sure that they are held accountable and that we are looking 

out for the people and our communities. So, let’s get the story 

straight. 

I know, gentlemen, you have been here a long time today, many, 

many hours. I know you are ready probably to go take a break and 

rest, and we thank you for your time this morning for serving our 

country and the roles that you all play in doing that oversight, but 

I want to just ask a couple of few questions to clarify what is going 

on. 

So, Mr. Dodaro, I know you have talked a lot this morning and 

probably answered this question in multiple ways, but I want to be 

very specific. Can you tell us how many convictions and guilty 

pleas have come from Federal charges regarding fraud with these 

COVID relief programs? 

Mr. DODARO. Yes. So far, according to the Department of Justice 

system, there have been over 1,000 people who have either pled 

guilty or have been convicted. There are another 600 people where 

charges are pending. There are hundreds of investigations underway now—— 

Ms. STANSBURY. Thank you. 

Mr. DODARO [continuing]. And will be done of the 1,000 people 

who have been guilty or—— 

Ms. STANSBURY. Thank you, Mr. Dodaro. I want to just clarify. 

So, we are talking less than 2,000 people, and we are talking about 

millions of Americans whose lives were impacted by these programs: 93,000 New Mexicans and less than 3,000 cases of fraud 

and abuse. Now, we need to hold those who committed crimes accountable, and that is exactly what we are going to do on this committee through the oversight of our Federal programs, who are 

tasked with that role and our law enforcement and our court system. 

Mr. LATURNER. The gentlelady’s time has expired. 

Ms. STANSBURY. But our job is to make sure that the American 

people are represented and we keep this government accountable. 

And with that, Mr. Chairman, I yield back. 

Mr. LATURNER. The chair recognizes the gentleman from New 

York, Mr. Langworthy. 

Mr. LANGWORTHY. Thank you very much, Mr. Chairman, and I 

thank the witnesses for their long testimony here today and your 

patience. 

This is an interesting topic for me because I was a victim of unemployment fraud in my prior role as chairman of the New York 

state Republican Party, and a fraudster and a criminal applied for 

unemployment insurance in my name through a previous address 

that I hadn’t lived at for over 10 years. The Erie County District 

Attorney in my community also was a victim in the same fashion 

where a fraudster used his name and very public profile to apply 
71 

for unemployment insurance. So, it was a very prevalent problem 

in my state, and reports indicate that billions of taxpayer dollars 

had been wasted due to mismanagement, fraud, inefficient processes by the government throughout this entire pandemic. You 

know, when a stock brokerage loses billions of dollars of their customers’ investments, the brokerage itself is blamed. However, when 

government does this, it is swept under the rug. The government 

should not be excused for losing money on this extraordinary level. 

Mismanagement and indiscretion to this degree is unacceptable, 

and it is an absolute disservice to the hardworking taxpayers that 

have entrusted their dollars, their hard-earned money to this government. 

So, Mr. Dodaro, in my home state of New York, a report from the 

Department of Labor showed that throughout the state Fiscal Year 

of 2021, the government wasted an estimated $11 billion of taxpayer money. The primary reason for this waste is the New York 

State Department of Labor was using outdated technology that it 

was recommended to replace not once, not twice, beginning in 2010, 

and again in 2015. So, Mr. Dodaro, I would like to ask you, are 

there other agencies in the Federal Government or any state governments, to your knowledge, whose outdated technology has led to 

wasted taxpayer dollars to that extent, and if so, would you mind 

mentioning who they are? 

Mr. DODARO. The problems with the IT systems affected a number of states, and, you know, to what extent compared to New 

York, I am not able to talk about that at this time. I know there 

were similar problems in California, for example, and we are now 

looking at additional states, but it was a problem affecting a lot of 

states. 

Mr. LANGWORTHY. And it was Federal money coming down to the 

states to make these programs whole. How, in the future, would we 

hold Federal agencies and state Governments accountable for failing to put in place mechanisms to reduce this risk of improper payment or actually just being so porous a fraud is so many states like 

New York were? 

Mr. DODARO. Yes. One way would be to make sure that they implement our recommendations that we have made by the GAO, inspector generals, and state auditors. Figures that you quote on 

New York came up from state auditors’ office, state auditors, and 

other states—California, Kansas, and others—have issued reports 

as well. So, one way is to make sure all those recommendations are 

implemented. Another way is to make sure that states certify that 

their systems meet certain standards and that there is appropriate 

independent verification that those systems are now able to meet 

certain standards. The Department of Labor should also provide 

some standards to the states, but each state has its own different 

system and eligibility requirements. So, it has to be tailored to the 

individual State. 

Mr. LANGWORTHY. Are there any mechanisms or penalties available to the Federal Government to prevent this sort of thing from 

happening again with states that won’t listen to the guidance? 

Mr. DODARO. Not to my knowledge right now. They would have 

to be instituted, and I think it would be good to be able to do that. 
72 

Mr. LANGWORTHY. It seems like we put ourselves in a pretty 

feckless position as a Federal Government, if we, you know, continue to allow states to ignore guidance that has been leveled on 

them, especially large populous states, you know, that have a population that is open to that much unemployment benefit. We can all 

agree that their losses to the tune of half a trillion dollars is unacceptable. I think everybody in this room can agree to that. We can’t 

allow this to occur again. We have to be way better stewards of the 

taxpayer dollar and take that responsibility much more seriously, 

but I thank you very much for your time here, and I yield back. 

Mr. LATURNER. The gentleman yields back. 

The chair recognizes the gentleman from Maryland, Mr. 

Burlison. 

Mr. BURLISON. From Missouri. Thank you. Thank you, Mr. 

Chair. 

Mr. LATURNER. My apologies. I am sorry. The ‘‘O’’ looks like a 

‘‘D’’ on my list here. The gentleman is recognized. 

Mr. BURLISON. Thank you. I am very honored to serve on House 

Oversight Committee this Congress, and I would like to thank the 

chair for the hard work that he has been doing on this committee. 

I look forward to working with each one of my colleagues here in 

the 118th Congress. 

My question is to Mr. Horowitz. On Monday, Senator Ernst revealed that thousands of Federal employees have double dipped on 

taxpayers and applied for pandemic unemployment assistance in 

addition to receiving their Federal paycheck. You know, just as a 

personal note, business owners and working families in Southwest 

Missouri, which is not exactly the richest part of the Nation, struggled quite a bit during the pandemic and their livelihoods were 

threatened, and yet Federal employees have the comfort of a government paycheck. Yet there is evidence that thousands of these 

Federal employees may have falsely claimed that they lost their 

job. My first question is, how is this even possible? Is there nothing 

in place to cross-check these employees or do we just pay out the 

benefits to whomever it applies? 

Mr. HOROWITZ. So, one of the challenges is, in fact, the absence 

of cross-checking information, and that has been a problem across 

programs. I am aware of Senator Ernst’s letter, and we are following up on that. We have done that, for example, at DOJ. I have 

looked at some of these issues, and we can look at it. It takes a 

fair amount of time once you get the hits to figure out actually 

whether there are fraud cases or not because there are spouses 

who potentially were eligible. We have identified where there are 

addresses. It turns out there are apartment buildings, so we then 

have to figure out who else is in that building, you know, whether 

that address is a hit or not. So, there are things we need to do to 

make sure we have got the right number ultimately, but it is an 

important issue, and we are going to follow up on it. 

Mr. BURLISON. Before I forget, Mr. Chairman, I seek unanimous 

consent to enter into the record the letter from Senator Ernst to 

the Honorable Michael Horowitz. 

Mr. LATURNER. Thank you. Without objection. My apologies. 

Mr. BURLISON. Thank you. Mr. Horowitz, in your report to Congress last fall, you said that the PRAC was working to identify ac-
73 

tive Federal employees who applied for PPP, and that so far, you 

had matched tens of thousands of employees with SBA loans for 

which they were not eligible. Do you have any updates on that 

analysis? 

Mr. HOROWITZ. We have matched the numbers, and that is what 

I was mentioning to you, we are working through. For example, in 

my office, we do have cases that are moving forward as a result of 

that, but it has taken a considerable amount of time to get from 

the large number to the smaller number because of the absence of 

particularized data. The challenge has been Agency data not being 

sufficient to immediately figure this out. 

Mr. BURLISON. Do you have an estimated, like an ETA, as when 

you might have the results? 

Mr. HOROWITZ. Well, when we find the case, we start investigating it. We were working with our law enforcement partners at 

that point, and hopefully those cases will wind up being prosecuted. 

Mr. BURLISON. And then what actions have we taken, if any, or 

what actions will be taken? I guess, if you could answer both, what 

action has been taken against Federal employees who might have 

applied for unemployment benefits fraudulently, and what actions 

would be taken? 

Mr. HOROWITZ. Well, you know, we are going to pursue those 

cases to the fullest extent possible, including seeking prosecutions 

working with our law enforcement partners on it. I can give you 

an example. We have several on the PPP/EIDL side. For example, 

a relatively higher-level person at NASA Agency was sentenced to 

considerable number of years in prison. He was worked in their financial office, who engaged in, I can’t remember whether it was 

PPP or EIDL fraud, but—— 

Mr. BURLISON. That is disturbing. 

Mr. HOROWITZ. So, we are pursuing those cases. 

Mr. BURLISON. That is good to know. Thank you. Mr. Chairman, 

before I forget, earlier we heard from Congressman Donalds about 

an article from Politico that the Biden administration had re-routed billions in emergency stockpile funds for the border, and I seek 

unanimous consent to enter this into the record. 

Mr. LATURNER. Yes, Mr. Burlison, from Missouri, without objection. 

Mr. BURLISON. Thank you. I yield back. 

Mr. LATURNER. The gentleman yields back. The chair recognizes 

the gentlelady from Georgia, Ms. Greene. 

Ms. GREENE. Thank you, Mr. Chairman. I would like to bring up 

something that was brought up by one of our Democrat colleagues 

on this panel about Republican Members of Congress taking PPP 

loans. I never took one as a Member of Congress, but as a business 

owner, I did take a PPP loan in order to be able to pay my employees. And I am so thankful I was able to do that because they would 

have lost their jobs, and I think it is important to recognize. But 

the minority side of our committee here is having a witness on the 

next panel that had said that she didn’t or her or any of her affiliates take any Federal grants or contracts related to this hearing’s 

subject matter. But in fact, as executive director of the National 

Employment Law Project, they took over $825,000 in PPP loans 
74 

from the SBA, so that that does need to be pointed out about the 

next panel witnesses. 

Here we are a Nation that our government spent over $5 trillion 

in COVID relief funding, and we can’t find $560 billion, I believe, 

of that money of the Americans hard-earned taxpayer funding. We 

are also a Nation at $34 trillion in debt, and we are on the verge 

of having to handle our debt ceiling, raise it once again, and here 

we are looking at waste, fraud, and abuse. 

And gentlemen, I thank you for coming and speaking to our committee on this issue. I know it has been a long day for you, but I 

would like to ask some questions about the type of funding that 

has been used with COVID relief funds, and it is pretty shocking 

to me. You know, I read some examples. For example, Washington, 

DC.’s Mayor Muriel Bowser plans to use $31.5 million in American 

Rescue Plan Funds to transition homes to green energy over the 

next five years. 

As many small businesses were shut down, children lost two 

years in education, child suicide rates went up, and it is hard to 

even imagine a child committing suicide. Many people died from 

COVID. Healthcare workers were fired from vaccine mandates, 

many other people were fired because of vaccine mandates, and all 

the issues that have come out of COVID. I want to ask about how 

this money has been spent because clearly, there is a tremendous 

amount of waste, fraud, and abuse. And a lot of our hard-earned 

taxpayers’ dollars spent on things that don’t even make sense that 

they have been spent on. 

So, Mr. Dodaro, if you don’t mind answering a few of my questions, can you tell me as our comptroller of the United States, how 

much COVID cash was given to abortion? 

Mr. DODARO. I do not know that answer. I don’t have that answer. 

Ms. GREENE. Oh, OK. So, I can tell you Planned Parenthood 

Clinics received $80 billion in COVID relief loans, which is hard to 

understand how that happened. Mr. Dodaro, can you tell me how 

much money COVID cash went toward diversity, equity, and inclusion, or racism issues? 

Mr. DODARO. Again, we have not looked at that issue, so I don’t 

know. 

Ms. GREENE. Oh, geez. Well, I can tell you the Pennsylvania Humanities Council did receive $1.4 million in relief and used it for 

equity and geographic diversity. I am not sure how that helped in 

a pandemic time. Mr. Dodaro, can you tell me how much COVID 

cash went to CRT? 

Mr. DODARO. CRT? 

Ms. GREENE. Critical race theory in education. It is a racist curriculum used to teach children that somehow their white skin is 

not equal to black skin and other things at education. 

Mr. DODARO. Yes. No, I do not know that, but I do know that 

there are provisions that the Federal funds, generally, they are not 

used—supposed to be used for curriculum. That is a state—— 

Ms. GREENE. Oh, Mr. Dodaro, I have to tell you in Illinois, they 

received $5.1 billion at an elementary school there that used it for 

equity and diversity, so it is being used for these things. Mr. 
75 

Dodaro, can you tell me how much money was given at Drag Queen 

Story Hour? 

Mr. DODARO. I am sorry. Can you repeat that? 

Ms. GREENE. Drag Queen Story Time where men dressed up as 

women and read confusing books to children. 

Mr. DODARO. At first, I thought you said, ‘‘dry clean,’’ so I am 

sorry. 

Ms. GREENE. It is OK. 

Mr. DODARO. No, I don’t know the answer to either one of those 

two. 

Ms. GREENE. We need to look into this, and I urge you to do that. 

Bradbury-Sullivan LGBT Community Center in Pennsylvania received $16,000 for Drag Queen Story Time from COVID cash. I 

think this is an issue that needs to be looked into. A lot of this 

money went to things that should have never gone to. 

Mr. LATURNER. The gentlelady’s time has expired. 

Ms. GREENE. And I thank you so much, and I yield back the remainder of my time. 

Mr. LATURNER. The gentlelady’s time has expired. 

The chair recognizes the gentleman from Pennsylvania, Mr. 

Perry. 

Mr. PERRY. I thank the chairman. Gentlemen, thanks for hanging in there. I know it has been a long day. Listen, I think it is 

important a couple of things to acknowledge. A lot of these folks 

that are involved in this, the government took them out of their 

jobs, told them they couldn’t go to work, Federal or state government couldn’t run their businesses, and so there are a lot of people 

that this did a lot of good things for, and we all want to acknowledge that. There was a lot that was unknown. 

I don’t agree with taking people out of their jobs or not allowing 

them to run their businesses, but that is another story for another 

day. The other thing that I just want to make a point is a personal 

sticking point for me. I don’t see unemployment insurance. I see 

unemployment compensation. There is no insurance about this. 

There is no actual aerials, there is no risk assessment to any of 

this, but that is a sticking point, but it becomes an entitlement for 

some folks. 

But in the interest of unemployment compensation, what I wonder, what I find interesting, among other things, is that according 

to a combination of estimates, $560 billion of that Federal COVID 

relief funding may have been either lost to fraud or paid improperly. And while some of my colleagues on the other side of the aisle 

condensed that to a percentage of the overall and would kind of 

have us believe that it is acceptable because it is a small percentage of trillions of dollars, I don’t know: $560 billion. I am from a 

little town in Pennsylvania. That seems like a lot of money to folks 

like me. I imagine you feel the same way. This is pursuant to ID 

ME, 40 percent, that is nearly half of pandemic unemployment assistance funds. That is $400 billion that did not go to Americans 

and instead went to criminal gangs in Russia, China, and Nigeria. 

Now I am from Pennsylvania, and we have got our own particular problems there, and we can get into that, but a Nigerian 

crime ring named Scattered Canary was involved in submitting 

more than 2 million claims. Two million claims from Nigeria. There 
76 

is this other one, APT 41, and I know that you have all—mentioned 

here before—talked about that $20 million stolen unemployment 

comp scheme began in mid–2020 and spammed 2000 accounts with 

more than $40,000 financial transactions. What in the Sam Hill is 

going on in our states? But the Federal Government gives the 

money to the states. They have an unemployment compensation 

system, so it is already up and running. So, we are just adding 

some more fuel to them so that they can take care of these people 

that have been put out of work by their government. 

How are foreigners? Like, do these states not see Nigeria, China, 

or some IP address that be associated with a foreign country and 

say, huh, I wonder why foreign countries are getting unemployment compensation, or, you know, do they fly back to work in 

America every day from Nigeria or from China or from Russia? 

Well, I don’t know. Can you make sense of this to, like, a small 

country boy like me? 

Mr. HOROWITZ. I don’t think I can make sense of it, but I can 

tell you that it is one of the problems we have identified along the 

way, not just in the Unemployment Insurance Program and others 

that agencies aren’t picking up the IP addresses for these applicants because the country was largely shut down. Most of these applications came in electronically, and that is clearly one of the red 

flags. And something by the way, as we get this data, we are going 

to be looking at is how many IP addresses were there associated 

with these various programs that were IP addresses from overseas. 

Mr. PERRY. I mean, some of the most egregious ones Washington 

State, California, New York. I come from Pennsylvania. I have got 

a whole list here of infractions from the state that I am proud to 

represent. These unemployment compensation systems have been 

around for a long time, so this is kind of in the past now or maybe 

it is still ongoing, maybe it is not at the same level. What assurance can you give me or anybody else here that the states have addressed any of this so that it, like, maybe it is not happening at 

the same scale, but if it has happened here, it probably continues 

to happen? What assurance can you give any of us that this has 

been solved at this point, and why should the Federal Government 

give one more dime to any of these states that are allowing that? 

Look, we are looking at a debt ceiling increase. They want $2.6 trillion. We just talked about $500 billion just handed out to foreign 

criminals. What assurance can you give us moving forward that 

any of this is solved right now? 

Mr. HOROWITZ. I am not going to give you any assurance that it 

is all—— 

Mr. PERRY. Is zero the right answer? 

Mr. HOROWITZ. That is why this hearing is actually important 

because, among other reasons, but there are fixes that need to happen. GAO has been talking about this for decades, and the Congress has to get involved. The administration has to get involved. 

The states have to get involved. We have to fix the problem. 

Mr. LATURNER. The gentleman’s time has expired. 

Mr. PERRY. Thank you, gentlemen. I appreciate you. 

Mr. LATURNER. The chair recognizes the gentlelady from Ohio, 

Ms. Brown. 
77 

Ms. BROWN. Thank you, Mr. Chair. I would just like to point out 

that my Republican colleagues are once again demonstrating the 

extreme lengths they will go to villainize reproductive freedom. 

Contrary to their allegations, Planned Parenthood health centers 

that received PPP loans were eligible non-profit recipients consistent with the SBA’s rules governing affiliation, status, and size. 

The Small Business Office of the Inspector General affirmed this 

conclusion in a September 2022 report that specifically determined 

Planned Parenthood health centers met PPP loan eligibility requirements. So, I would ask unanimous consent that the SBA OIG 

report be made part of the record, and I urge my Republican colleagues to cease their baseless draconian attacks against the reproductive freedoms of people once and for all. 

And finally, the last point I want to make is just because you disagree with the spending doesn’t mean that it is fraudulent, wasteful, or abusive. And with that, I yield back. 

Mr. LATURNER. Without objection, it will be entered into the 

record. 

Mr. LATURNER. The gentlelady yields back. The chair recognizes 

the gentleman from Tennessee, Mr. Burchett. 

Mr. BURCHETT. Thank you, Mr. Chairman, and I am not an attorney, and I am not trying to do any ‘‘got you,’’ so if you all want 

to give me just a ‘‘yes’’ or ‘‘no,’’ it would be great. All right. Assistant Director Smith, in 2021, NBC reported that between $90 and 

$400 billion pandemic-related unemployment U.S. taxpayers’ dollars had been stolen, and half of that was taken by foreign criminals. Is this consistent with what your investigation revealed? 

Mr. SMITH. Sir, I can’t validate that particular news piece. Which 

outlet did you say it was from? 

Mr. BURCHETT. NBC News. It has been widely reported in other 

areas, but they were the biggest dog that wagged its tail on that, 

I guess. 

Mr. SMITH. I am not the—— 

Mr. BURCHETT. OK. Well, the former assistant director of investigation of the Secret Service, Jeremy Sheridan, called this theft, 

‘‘the largest fraud scheme that I have ever encountered.’’ And I 

guess what I am getting at is, is that it seems to be it is clear that 

foreign and maybe some localized organized crime syndicates and 

other bad actors have perpetrated some crimes against the American taxpayers. Assistant Director Smith, do you agree with Mr. 

Sheridan or have you ever encountered a larger fraud scheme? 

Mr. SMITH. I agree with former Assistant Director Sheridan’s 

sentiments. The magnitude of pandemic-related fraud was what 

made it unique. 

Mr. BURCHETT. Do you think that in your professional capacity 

or otherwise that maybe some of these funds could be linked to terrorism organizations, that these things would fund them? 

Mr. SMITH. Sir, I don’t have any direct evidence linking terrorist 

organizations to pandemic relief funds, but as I mentioned earlier, 

it is not beyond the realm of possibility of transnational criminal 

organizations and groups of various sorts. 

Mr. BURCHETT. And drugs and human trafficking, all those dirt 

bags that kind of run together, I guess. 
78 

Mr. SMITH. Yes, sir. The group I mentioned earlier, like Black 

Axe out of Nigeria, they involve themselves in human trafficking, 

drug trafficking, the full gambit itself. 

Mr. BURCHETT. OK. 

Mr. SMITH. They are also involved in pandemic-related—— 

Mr. BURCHETT. All right, and thank you. Comptroller Mr. 

Dodaro—did I say that name right? I get it. 

Mr. DODARO. Pretty close. 

Mr. BURCHETT. Pretty close. Well, Burchett, so we can just go to 

get massacred together. I sent a letter in April 2020 to then Treasury Secretary Mnuchin, raising concerns about economic impact 

payments going to ineligible foreign nationals. And my Republican 

colleagues have tried to warn our friends across the aisle that we 

should not go blindly throwing money at this pandemic without 

oversight. Unfortunately, I am afraid they didn’t listen. Does the 

GAO have details in the amount of payments that were incorrectly 

provided to eligible foreign nationals or deceased individuals during 

the rush to send COVID checks to all corners of the world? I am 

sure this has sort of been asked earlier, but I have been in and out, 

so if you would tell me. 

Mr. DODARO. No, no, I understand. First on deceased individuals, 

there is a tax inspector general. 

Mr. BURCHETT. Right. 

Mr. DODARO. They found $1.4 billion sent to deceased individuals 

in the first and second round of the economic incentive payments. 

Mr. BURCHETT. Right. Now, would you call that fraud or just 

mistakes, or just people have died since that had gone on? 

Mr. DODARO. It is a mistake. 

Mr. BURCHETT. OK. Wow. 

Mr. DODARO. It is a mistake. And actually, IRS interpreted it 

that Congress intended them to do that. So, it wasn’t until Treasury stepped in and said that that was inappropriate and we recommended that they try to get that money back, and they did receive about half of it back. 

Mr. BURCHETT. OK. Do you agree with the assessment that several experts and some government officials at different levels, they 

have indicated that there was so much fraud in the COVID relief 

because of the lack of clear guidance, and that was done by Congress obviously amid the rush to give away taxpayer dollars? 

Mr. DODARO. That was a contributing factor, particularly at the 

PPP level, but I think the main things were self-certification, lack 

of supporting documentation. 

Mr. BURCHETT. Right. 

Mr. DODARO. And actually, the CARES Act prohibited the Economic Injury Disaster Loan Program from using tax transcripts to 

compare against the loans. 

Mr. BURCHETT. Wow. 

Mr. DODARO. And so, now Congress fixed these things later, but 

those things affected the Unemployment Insurance Program, too. 

Mr. BURCHETT. Right. 

Mr. DODARO. Congress gave an incentive for states to waive some 

of the requirements by giving them additional money to do it. 

Mr. BURCHETT. Cow is already out of the barn. 

Mr. DODARO. The cow, the pig, the chicken, and—— 
79 

Mr. BURCHETT. Yes, the whole barnyard. So, because of that lack 

of clear guidance, have we learned anything? Do we have the proper things in place to stop that from happening again? And I am 

running out of time. Give me a quick one, Mr. Chairman. 

Mr. DODARO. We are starting to move, but it is slow, but much 

more needs to be done to be better prepared next time. 

Mr. BURCHETT. All right. Thank you. Thank you, you all. I know 

you all probably woke up this morning and thought, wow, I am 

going to go before Congress. It is going to be great, and now, you 

are still here, so—— 

Mr. LATURNER. The gentleman’s time has expired. I am going to 

recognize myself for five minutes. 

Although, I served on this committee last Congress, I am excited 

to bring much needed accountability to Washington for the first 

time in over two years. My Republican colleagues and I are committed to returning this committee to its proper role of rooting out 

waste, fraud, and abuse, and mismanagement in the Federal Government, and that commitment starts today. In the span of one year, Congress passed upwards of $4.6 trillion 

in the form of economic stimulus bills and expanded eligibility for 

Federal relief programs, like unemployment insurance. When communities across America started to recover from the pandemic, 

Congress continued to saturate states with millions of taxpayer dollars under the guise of COVID–19 relief without the means to distribute it efficiently or safely. A Kansas audit showed that my 

home state may have made hundreds of millions of dollars in 

fraudulent payments when state agency systems were overwhelmed by an unprecedented number of claimants. As recently as 

last September, the Department of Justice charged 47 people with 

using the Federal Child Nutrition Program in Minnesota to siphon 

$250 million. And it is no secret that many states have used these 

funds to alter school curriculums, give illegal immigrants stimulus 

checks, and advance green energy initiatives. 

Public trust in our government is at an all-time low, and we cannot expect that to change if we continue this poor stewardship of 

Americans’ tax dollars. I think Congress can do better, and I look 

forward to discussing with our witnesses how to avoid this level of 

fraud and waste of taxpayer dollars in the future. 

Mr. Dodaro, and I will ask the same question of the other two 

witnesses, your institution is tasked with monitoring administrative agencies and providing recommendations for improvement. Per 

GAO’s website and the testimony we have heard, fraud detection 

is a difficult task. Can GAO ascribe a monetary cost to conducting 

fraud detection and retroactive certification of payments? If not, 

can you describe the potential opportunity cost to the taxpayer of 

directing agency attention toward auditing massive COVID payments after they are distributed? 

Mr. DODARO. It is much more efficient to prevent the fraud from 

occurring in the first place. That is why we worked with Congress 

back in 2015 to 2016 to pass the Fraud Reduction and Data Analytics Act to put in place a framework that we develop for best 

practices on how to prevent fraud in the first place. Much more efficient, much more effective. 

Mr. LATURNER. Mr. Horowitz? 
80 

Mr. HOROWITZ. Yes, I would say the same thing. We talked about 

this earlier, about the recovery rate when the money is already 

gone and you have to chase it down. It is a 10–12 percent rate, I 

think Mr. Dodaro indicated. Keep in mind, money, for example, 

that goes overseas takes a long time to try and track that down, 

if you ever can, and so that is the challenge. There is no better way 

to eliminate or reduce fraud rates than to detect it and prevent it 

at the outset. 

Mr. LATURNER. Mr. Smith? The winner of the easiest name 

award on the panel today. 

Mr. SMITH. Thank you. 

Mr. LATURNER. Yes, it is. 

Mr. SMITH. I agree with my colleagues. The Secret Service, prior 

to the pandemic, is in the business of mitigating financial crimes 

and fraud. I mentioned earlier that that is in our DNA, if you will. 

We do advanced work because we know criminals are nonstop in 

their efforts in trying to defraud Americans, whether before the 

pandemic or not. 

Mr. LATURNER. Let’s stay with you. You worked with government entities like the Small Business Administration, the Department of Labor, ahead of the enactment of the pandemic relief funding to explore strategies to address what you describe as a, quote, 

‘‘a looming wave of potentially fraudulent activity.’’ Drawing from 

your experience, tracking fraud in Federal relief programs, what 

could the government have done to better support states and entities in charge of dispersing funds? 

Mr. SMITH. What could we have done to support the states? 

Mr. LATURNER. Correct. 

Mr. SMITH. So, one of the things I mentioned earlier was putting 

out alerts. So, our Cyber Fraud Task Forces and our Global Investigative Operations Center, which is the hub of all of our task 

forces, submitted alerts, GIOC alerts, if you will, to 30,000-plus financial institutions and to those partners. What we were doing was 

sharing indicators of compromise with those entities, such as if an 

individual was using an IP address that was from an overseas originating point, or if a financial institution saw, if you happen to see 

an account being opened fairly recently and that account was being 

used to move a substantial amount of money in a short period of 

time, that would be something you would flag. So, one of the things 

we did at the beginning of the pandemic and even prior was sharing information and indicators of compromise that we are seeing 

not only from other entities, but from criminals themselves, because keep in mind, as a Federal law enforcement entity, we do 

work with criminals. We have confidential informants, and we get 

information from the inside, if you will, regarding what tactics are 

afoot. 

Mr. LATURNER. Thank you, and the committee thanks all three 

of you for being here today and doing a great job answering questions. 

At this time, we are going to pause and change out the panels. 

[Recess.] 

Mr. LATURNER. The committee will come back to order. 
81 

For our second panel today, I would like to introduce Ms. Rebecca Dixon, the executive director of the National Employment 

Law Project. Welcome to the committee. 

Please stand and raise your right hand. 

Do you swear or affirm that the testimony you are about to give 

is the truth, the whole truth, and nothing but the truth, so help 

you God? 

Ms. DIXON. Aye. 

Mr. LATURNER. Let the record reflect the witness has answered 

in the affirmative. Thank you. 

Without objection, your written statement will be part of the 

record. 

You are now recognized for five minutes for your opening statement. 

STATEMENT OF REBECCA DIXON, EXECUTIVE DIRECTOR OF 

THE NATIONAL EMPLOYMENT LAW PROJECT 

Ms. DIXON. Good afternoon, Chairman Comer, Ranking Member 

Raskin, and members of the committee. Thank you for the opportunity to testify today. I am Rebecca Dixon, executive director of 

the National Employment Law Project, a nonprofit research, policy, 

and capacity-building organization that for more than 50 years has 

sought to strengthen protections and build power for workers in 

the U.S., including workers who are unemployed. 

We must never lose sight of the terrible hardship that the early 

days of the COVID–19 pandemic imposed on workers, families, and 

communities nationwide. By April 2020, 23 million U.S. workers 

were unemployed. Congress stepped up to pass six bills which created programs that literally saved lives and livelihoods and prevented what could have been a prolonged and devastating economic 

collapse. This robust policy response helped to make the COVID recession the shortest on record and contributed to an economic recovery that has brought the unemployment rate from a high of 14.7 

percent in 2020 to 3.5 percent today. Indeed, according to Moody’s 

Analytics, without these programs, the economy would have succumbed to a double-dip recession. A combination of well-designed 

social insurance programs drove poverty to the lowest level on 

record in 2021, cutting the number of poor children by nearly half 

and keeping over 25 million people out of poverty. 

One important piece of the protections enacted by Congress were 

the pandemic unemployment insurance programs that not only contributed to the historic reductions in poverty in 2020 and 2021, but 

they also broadly supported recipients’ financial stability and overall well-being, filling in the substantial gaps in the Nation’s inadequate UI system. UI is particularly effective at getting money into 

the hands of consumers who need it and who will spend it quickly, 

and this supports businesses in their communities and stabilizes 

state economies. 

Unfortunately, a decades-long failure to properly invest in the 

administration of the UI system made it an appealing target for organized crime during the pandemic. Chronically underfunded and 

understaffed state UI systems operating with antiquated technology were tasked with building and implementing a major new 

set of Federal programs with little advanced preparation. This re-
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sulted in multiple points of vulnerability for criminal enterprises, 

which have previously stolen the identities of workers during private sector data breaches. They seized upon this pandemic as a 

time to use those stolen identities to fraudulently obtain UI benefits. 

As the temporary Federal pandemic programs had to be built virtually overnight, state agencies were not able to design systems to 

protect against identity fraud in these programs. As detailed in my 

written testimony, Department of Labor has had notable recent 

successes in pioneering national fraud prevention solutions and enlisting state participation. Using funds from the American Rescue 

Plan, DOL has made substantial investments in strengthening 

state systems to detect and prevent future identity fraud. DOL 

Tiger Teams, equity grants, and IT modernization assistance all 

combine a focus on improving access to UI for eligible workers with 

resources and expertise to combat fraudulent activity. DOL also offers a wide range of technical and system support for state fraud 

prevention, detection, and recovery. 

State participation in the Integrity Data Hub and the use of its 

crossmatch systems have increased significantly since the pandemic with more states using DOL’s identity verification service, 

incarceration data exchange, and recently launched bank account 

verification service that enables states to thwart ID fraud by 

verifying that a bank account belongs to the worker claiming benefits. Moreover, states can no longer bring in contractors to help run 

their programs as they were given emergency flexibility to do so 

during the height of the pandemic. GAO noted that a major cause 

of increased identity fraud was the insufficient number of state UI 

staff and the fact that new staff were severely under-trained. Although intended to handle a historic increase in claims, inexperienced and insufficiently trained contract staff, through no fault of 

their own, both contributed to increased fraudulent activity and 

created greater obstacles for workers who were seeking benefits. 

As for the outdated IT systems used by so many state programs, 

Congress has provided much-needed increases in Federal funding 

for UI administration and worker-centered technology modernization over the past two years. Congress must continue making these 

investments because sophisticated criminal enterprises will continue to seek vulnerabilities in state systems, and state agencies 

will need to keep pace. 

In conclusion, the pandemic relief that Congress enacted combined to provide critical lifeline to workers, families, and communities in the Nation’s economy. I hope that this committee will recognize the tremendous value of COVID relief programs and work 

together to find meaningful solutions to the ever-evolving problem 

of identity fraud that has undermined their effectiveness. Thank 

you. 

Mr. LATURNER. Thank you, Ms. Dixon. The chair recognizes the 

gentlelady from Ohio, Ms. Brown. 

Ms. BROWN. Thank you, Mr. Chair. Since this is our first committee hearing of this Congress, I want to express my hope that 

this committee will, on a bipartisan basis, find ways to strengthen 

Federal programs and serve everyday working people. I truly want 
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to work with my colleagues on both sides of the aisle to make life 

better for all our constituents, including mine back home in Ohio. 

In that spirit, I want to share some real-life stories of people in 

Ohio who have benefited from some of the lifesaving pandemic relief programs we are discussing today. Here is an example. Tiffany 

from Northeast Ohio said, and I quote, ‘‘I was laid off on March 13, 

2020. Even though it took a month to begin receiving my unemployment benefits, I am so thankful for them. Without them, my 

family of four wouldn’t have anything at all coming in. The extra 

Federal money per week enabled me to pay my bills and helped me 

to provide for my children in such a traumatic situation.’’ Tiffany’s 

testimony is just one example among millions in all our districts, 

urban or rural, dense or sparse, rich or poor, for whom this Federal 

assistance made all the difference. 

Ms. Dixon, how did COVID–19 relief legislation, such as the bipartisan CARES Act and the American Rescue Plan, save American families from disaster? 

Ms. DIXON. So, one thing we know is that the economy is 70 percent consumer spending. Consumer spending drives our economy, 

and with 23 million workers out of work, there would have been 

an enormous contraction of spending, which would have then sent 

us into a double-dip recession. It also prevented hunger and homelessness and really allowed families to focus on caregiving for their 

sick family members. And it was just really a lifeline, a critical, important way that Congress came through for working families. 

Ms. BROWN. Thank you very much. So, it is clear to me that the 

Biden administration and Congress took decisive action to provide 

relief for the American people. The critical and much-needed investments in health and economic programs are helping the country recover and bounce back from the worst pandemic in recent 

memory, so let us not forget that, and we are continuing to emerge 

stronger than ever. And with that, Mr. Chairman, I yield back the 

balance of my time. 

Mr. LATURNER. The gentlelady yields back. The chair recognizes 

the gentlelady from Vermont, Ms. Balint. 

Ms. BALINT. Thank you, Mr. Chair. First of all, thank you for 

being here. I really appreciate it. As you know, Ms. Dixon, in 

March and April 2020, we experienced really an unprecedented economic shock. Twenty-two million people lost their jobs, millions of 

people suddenly found themselves without an income, and in April 

in 2020, when I was a leader in the Vermont Senate, we saw 

Vermont’s seasonally adjusted unemployment rate go up to 15.6 

percent, which was up 12 percent from the year before. So, thankfully, Congress stepped in and helped us to expand the unemployment insurance. And as you said and as others have said, it was 

an absolute lifeline for families and individuals. 

So, my question is, without unemployment insurance programs, 

how would individuals and families be able to respond to such an 

economic crisis? Like, what happens without these kinds of funds 

to allow individuals and families to stay afloat? 

Ms. DIXON. It is not necessarily well-known, but the unemployment insurance is the first line of defense against poverty and 

homelessness. It is the only universal cash program that we have 

that provides cash to working families when they lose a job. There 
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is nothing else. And what we saw in the Great Recession, when 

folks were exhausting their benefits, is the other program that they 

turned to was the SNAP program, and there really was nothing 

else. And so, it just can’t be stressed enough how critical this program is to making sure that families can maintain while they 

search for work. 

Ms. BALINT. I really appreciate that distinction, and I think we 

can’t overstress it. I know for me, having worked directly with individuals and families, thousands of Vermonters, that is exactly what 

I was hearing from my own constituents. So, when we think about 

unemployment insurance programs and how they assist workers in 

job searches, do job searches change when an individual is benefiting from an unemployment insurance benefit? 

Ms. DIXON. The benefit has many important qualities. One is 

that it allows workers to actually match with jobs that match their 

skills so they are not trying to take the first possible thing that is 

offered to them, which is not good for the economy because those 

folks’ skills are being unused. So, it does give them the breathing 

room to find a good match that is going to be close to the salary 

that they were receiving before they lost their job. 

Ms. BALINT. And I would assume that not only would those skills 

go unused, but when you have a worker who is mismatched, they 

are much less likely to stay in that job, so exacerbating this cycle 

of turnover, which we know is not good for employers, it is not good 

for employees or families. And is that the case? Do we see that 

there is a connection there with job churn? 

Ms. DIXON. There absolutely is, and we have heard employers 

loud and clear, particularly in some of the industries that were 

hardest hit in the pandemic, the service industry, the restaurant 

industry, where workers have actually left those industries entirely 

to go to other industries because better conditions and better pay. 

And so, if a worker takes a job, we want them to actually be able 

to stay in that job, advance in that job. So, it is important to them 

and their families, just as it is important to employers to have stability in the role that they are in. 

Ms. BALINT. Thank you. Just one more question. From your perspective, from your experience, and your research, and the work 

that you do in your position, why do you think we need to continue 

to invest in and modernize state unemployment insurance systems, 

because we heard in the earlier testimony how there was a breakdown there. So, we would love to hear from you, from your perspective, why that is so important. 

Ms. DIXON. So, about a decade ago, I did a report that was a 

deep dive on unemployment insurance administration and the impact on being able to pay benefits, and what I found then was that 

the average UI benefits IT system was 26 years old. That was 10 

years ago, and at the time, the oldest one was 46 years old. And 

so, it is critical for us to invest, to actually put the money in. So, 

usually when there is a crisis like this pandemic, there is investment in unemployment, there is investment in the IT systems, 

there is investment in administration, but then as soon as the 

economy recovers, we take our foot off the gas, and we really need 

to keep our foot on the gas for this program. We need to actually 

make the changes that are needed so that these systems function 
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correctly all the time, whether it is one family who is suffering unemployment or it is millions of people suffering unemployment. 

Ms. BALINT. Thank you so much. I yield back. 

Mr. LATURNER. The gentlelady’s time has expired. The chair recognizes the gentlelady from Missouri, Ms. Bush. 

Ms. BUSH. Thank you. St. Louis and I are here in support of a 

government that ensures no one lives in poverty. During March 

and April 2020, the U.S. economy lost more than 22 million jobs. 

Our unemployment rate jumped from 3.5 percent in January 2020 

to a pandemic peak unemployment rate of 14.7 percent in April 

2020. St. Louis families and families all across the country were in 

need of emergency assistance during those uncertain times. 

One such story shared by the National Employment Law Project 

comes from my constituent, Deshauna, a single mother from St. 

Louis. She said, ‘‘If it wasn’t for unemployment, I would have been 

put out of my apartment. Thank God for the help. I am still trying 

to get myself out of debt, but the pandemic unemployment gives me 

and my son a little security. I am a single parent getting no help 

from the other parent, plus losing my job, so it has definitely been 

a blessing.’’ 

The CARES Act created a temporary unemployment insurance 

program called the Pandemic Unemployment Assistance, or the 

PUA. In 2020, President Biden signed the American Rescue Plan 

into law, which extended PUA and other temporary unemployment 

insurance benefits. The PUA unlocked unemployment insurance 

benefits to workers and to families who were otherwise excluded 

from regular UI programs. This program was the difference between a full dinner table and an empty one for a number of families. Ms. Dixon, who benefited the most from these programs, and 

can you tell us why? And thank you for being here. 

Ms. DIXON. So, the unemployment insurance program was created 80-plus years ago, and it has not been substantially modernized, and it was created on a structurally racist foundation that 

was aimed at white male breadwinners. And so, if that is the foundation. That is who mostly benefits from unemployment insurance, 

and so that means women workers, folks who work part time. It 

means people who work in restaurants and service jobs where their 

wages are low, they often are just entirely left out of the program, 

and most workers who are in gig jobs are also excluded from the 

program. 

So, as the work force has changed over time, many workers have 

been left on the sidelines, and particularly, this impacts women 

and workers of color. And so, adding this program actually invited 

them into the program, some for the first time in their working 

lives. 

Ms. BUSH. Thank you. In August 2020, the Department of Labor 

announced that it would distribute up to $260 million in grants to 

states to address disparities in the service delivery and administration of state unemployment insurance systems and promote equitable access to benefits. Ms. Dixon, how have the Department of 

Labor’s equity grants impacted local communities across our country? 

Ms. DIXON. One of the most critical things to understand when 

folks are doing this work in the states, they want to pay benefits, 
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so they are not standing in the way. They are actually working 

really hard when they are understaffed and, you know, underinvested in. And one of the things that the Equity Grant Program 

has helped is for those folks to understand what the impacts are 

of the way the program is designed, so that it is not necessarily the 

individuals and the actions that they are taking, but it is the system and how they need to change what they do to help offset the 

inequities in the system. And that has been a really critical piece 

for states to take to heart as they are working to serve unemployed 

workers. 

Ms. BUSH. Thank you. Sadly, Republicans are so focused on cutting programs that benefit regular everyday people, that it is impossible to take their criticisms of these programs seriously. We 

need to ensure funds are being used properly and then expand 

these programs and expand them permanently. Democrats will continue to lead with bold legislation that tackles our Nation’s crises 

while advancing equity and equal opportunity. Thank you, and I 

yield back. 

Mr. LATURNER. The gentlelady yields back. The chair recognizes 

the gentlelady from Pennsylvania, Ms. Lee. 

Ms. LEE. Thank you, Chairman, and thank you so much, Ms. 

Dixon, for your testimony. On the last panel, I discussed and we 

discussed my time at the state legislature in Pennsylvania where 

we heard intimate struggles of Americans that they faced throughout the pandemic. They often had to choose whether to pay their 

rent or their childcare, as we know. And we also know that these 

conditions are unacceptable. Ms. Dixon, I understand all states approach unemployment differently. Based on your research, is there 

an ideal state system we could learn from here in Congress? 

Ms. DIXON. So, rather than an ideal state system, the thing that 

Congress could do is create a universal baseline that is Federal 

standards that every state has to meet. Right now, depending on 

the state that you happen to be unemployed in, you may receive 

a benefit as low as $235 a week as the maximum, or you may receive eligibility for as low as 12 weeks of payment as opposed to 

26 weeks in other states. And so, that doesn’t make any sense that 

we would have this patchwork of programs if we really want to 

make sure and we are serious about coming through for unemployed workers when they need us the most. 

And so, having a baseline of standards where there is a minimum 26 weeks that all states have to pay, where there is a minimum dollar amount that fits what the state’s economy is, that 

there is a minimum set of eligibility standards that fits all workers. 

We need that, and we need that crucially. We also need an extended benefits program that turns on automatically and just triggers on when there is a crisis so that workers are not waiting for 

congressional action, but they can rely on their programs to just 

spring into action. 

Ms. LEE. Thank you. We talked about how some of the different 

workers or different people benefited more from some of these programs. Could you elaborate on the disparate impact the pandemic 

had on communities of color that you shared in your testimony? 

Ms. DIXON. Yes. So, our labor market is very stratified, and by 

‘‘stratified,’’ I mean that women make up the largest portion of low- 
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wage workers and people of color also, and those jobs were actually 

really hit hard in this pandemic. And so, those folks lost their jobs, 

but because of history, they also don’t have wealth accumulated in 

savings. And so, the fact that Congress took action so quickly and 

was able to get the money out the door, it meant a lot to folks who 

did not have savings to rely on and for whom this program made 

the difference between being able to pay rent and stay in their 

homes. 

Ms. LEE. Thank you. Last, where would we have been without 

these programs? In other words, what would have happened to the 

millions of individuals who relied on these programs during the 

pandemic without them? 

Ms. DIXON. We would have had incredible child poverty, and a 

tsunami of evictions, and many other ills that we were able to 

avoid, and that was really great for children, for families and communities. And Congress really came through for working people in 

this program, and it is something that we will feel the positive effects of for generations. When families are in poverty, it is very 

hard on children. It is hard on the mental health of parents if they 

don’t have income. And so, there is a payoff beyond just the actual 

monetary amount that happens in families that we will be reaping 

the benefits for generations to come. 

Ms. LEE. Thank you for your testimony and for your answers. 

With that, I yield back. 

Mr. LATURNER. The gentlelady yields back. The chair recognizes 

Mr. Goldman from New York. 

Mr. GOLDMAN. Thank you very much, Mr. Chairman, and thank 

you, Ms. Dixon, for being here with us today. I am from New York. 

New York State experienced its first COVID–19 case on March 1, 

2020, and I actually got COVID myself on March 10, very early on. 

New York was at the epicenter of the pandemic at the beginning, 

and more than 78,000 New Yorkers have died as a result of 

COVID. As families in New York endured record unemployment 

throughout the pandemic, the unemployment insurance system became a lifeline to nearly 5 million New Yorkers. In my district, organizations like the Chinese-American Planning Council connected 

at least 740 households with unemployment insurance, nearly 

2,000 families with housing assistance. And more than 1,300 people who were excluded from Federal relief programs got aid 

through New York City’s innovative Immigrant Emergency Relief 

Program, and that is just one outstanding organization of many. 

When COVID surged and 22 million people lost their job, it fell 

to our unemployment insurance system to take on the immense 

volume of new claims. New York’s Department of Labor distributed 

more than $105 billion, which is the equivalent of 50 years’ worth 

of benefits in the two years from the start of the pandemic. But obviously, this new influx of benefits opened itself up to fraud, especially through identity theft online, which I know you have spoken 

about. The New York State Department of Labor has recommended 

that Congress provide sustained investments and additional resources to help states combat the ever-evolving threat of cyber 

fraud. 

And, Ms. Dixon, I am curious what you think Congress should 

do to assist states, separate from the sort of Federal baseline that 
88 

you talked about. Where would our resources be most effective in 

assisting states to modernize and upgrade its unemployment insurance systems? 

Ms. DIXON. I am echoing folks from the first panel. The information technology investments are critical. We have a decentralized 

system. There are 53 different unemployment insurance programs, 

and so there are 53 opportunities for criminal fraud rings to attack 

the system. And so, really being able to invest in those systems, to 

harden those systems, to make sure that those offices are staffed. 

And one other really critical thing that Congress could do is create 

a program like the Extended Benefit Program that actually can be 

pre-programmed and already have the fraud measures built into it 

so that when there is a crisis, it just triggers on, and states are 

ready, and they are not rushing to program a different program 

each time that there is a crisis. 

Mr. GOLDMAN. Thank you. One of the most, I think, productive 

and effective measures that Congress passed was the child tax 

credit, and I would love for you to talk a little bit about the success 

of the child tax credit and why it was so successful at reducing 

child poverty. 

Ms. DIXON. So, one piece of it was that money actually went into 

families’ bank accounts, and they did not have to wait until they 

filed their taxes to get this money. And so, when you add that 

money together with the unemployment insurance payments, you 

have families actually getting cash to meet their needs at a critical 

time. And we see that in the reduction of poverty, like what the 

huge impact that was to families and children all over the United 

States. 

Mr. GOLDMAN. And you are drawing a distinction between the 

earned income tax credit, which comes when you are paying your 

taxes, as opposed to cash direct deposited or sent to you by check 

in that moment. Is that what you are saying? 

Ms. DIXON. No. So, the child tax credit is also generally not paid 

on a monthly basis the way it was in this instance. So, it generally 

is something that either folks are changing their tax withholding 

to account for, or they are waiting until they file their taxes to get 

it. So, what was really revolutionary was actually giving the cash, 

putting the cash in families’ bank accounts. 

Mr. GOLDMAN. And in my final seconds, can you talk especially 

about how important that child tax credit was to underserved communities and people of color in particular? 

Ms. DIXON. Well, we know that those families are the ones who 

are hit the hardest in this pandemic, but they are also sort of 

chronically hit the hardest because they are in the lowest-paying 

jobs. And so, to make sure that children actually have their needs 

met, this was critical, and it was critical. It would have been critical at any time, but it was especially critical during this pandemic, 

and it would be great if Congress could figure out how to reinstate 

it because the impact was just phenomenal for families. 

Mr. GOLDMAN. Thank you, and I yield back. 

Mr. LATURNER. The gentleman’s time has expired. The chair recognizes the gentlelady from New York, Ms. Ocasio-Cortez. 

Ms. OCASIO-CORTEZ. Thank you, Mr. Chair. It can be difficult to 

remember given all that has happened in the last three years, but 
89 

I would like us to envision ourselves back in those first few months 

of the pandemic in the spring of 2020. In March and April 2020 

alone, the economy lost more than 22 million jobs, and the unemployment rate skyrocketed to 14.7 percent. Jobs in sectors that are 

absolutely essential to the American economy were threatened. But 

after the CARES Act, states were able to put in place expanded unemployment insurance programs to assist workers who had lost 

their jobs, and Census data shows that these expanded benefits 

kept approximately 5.5 million people out of poverty in 2020. 

Ms. Dixon, I am curious about, from your vantage point, how expanded unemployment insurance played out as such a vital lifeline 

for workers as well as states during the pandemic. 

Ms. DIXON. So, one of the reasons that Congress put in place 

these programs is because the unemployment insurance program in 

the states is inadequate, inadequate in who it covers, inadequate 

in how much the weekly benefit amount is. And so, when Congress 

added $600 a week and then $300, that was amazing, especially in 

states where the national average benefit is only $300 a week. And 

so, this made it possible for folks to stay in their homes. They 

didn’t have to choose between food and gas in their cars. It was 

critical, and I think that part of what we have to do is learn from 

the successes. 

So, we have talked a lot about instances where there was identity theft and fraud, but we haven’t talked about the amazing number of folks who got UI for the first time and what it meant for 

them and their ability to stay attached to the work force. And so, 

I think we really have to mine the data on the good pieces and figure out what we can carry forward and what Congress can do to 

actually carry those pieces forward as a minimum standard for 

states to implement. 

Ms. OCASIO-CORTEZ. Absolutely. Thank you for that information 

because, you know, for so much in this hearing, there is a constant 

focus not just on the notion of the pandemic response being fraudulent or wasteful, but it seems as though a particular fixation on the 

unemployment program, which, as you stated, if it weren’t for the 

Federal unemployment supplemental program, families would have 

been potentially enduring months of unemployment and having to 

just scrounge by on as little as $300 a week. And especially when 

it comes to skyrocketing costs of housing, would it be also in your 

assessment that this could have also potentially, without that Federal response, dramatically expanded the amount of housing insecurity and people who may even be struggling with homelessness 

if it weren’t for that supplemental? 

Ms. DIXON. It absolutely did because even though there were also 

things that Congress created that were housing supplements and 

assistance, it did take a while to get out, and the UI program is 

the quickest way to get money into the pockets of workers. And so, 

this really did have a critical influence on being able to stay in 

homes and for folks to be able to pay their rent. And, you know, 

there was an eviction moratorium, but it also means that they are 

not sitting there with $10,000 of back rent that they can never pay. 

So, you know, it kept them going in a way that made sure that 

they weren’t incurring debt to actually try to just do their basic living expenses. 
90 

Ms. OCASIO-CORTEZ. Absolutely, and despite the United States 

experiencing the worst job losses since the Great Depression during 

that early COVID period, the COVID–19 recession was also the 

shortest on record. But to expand on this point that you are making, how did these pandemic relief programs, particularly unemployment insurance, help stabilize the economy even from a more 

macro perspective? 

Ms. DIXON. So, because so much of our economy is based on consumer spending, that is the first thing that families cut back on, 

and so we know it is kind of like a, it is an unvirtuous cycle. So, 

there is an economic downturn, there is a contraction, and it just 

gets worse and worse. And so, the UI program actually did what 

it was designed to do, which was to stabilize the economy, to stabilize communities and state economies, and to prevent that downward spiral, and to prevent a double-dip recession, which we had 

some experience with a pretty terrible recession not that long ago. 

And so, just being able to get through this pandemic without that 

protracted recession and also without that protracted high unemployment rate. 

Ms. OCASIO-CORTEZ. So thank you, and I yield back to the chair. 

Mr. LATURNER. The gentlelady yields back. The chair recognizes 

the distinguished ranking member, Mr. Raskin. 

Mr. RASKIN. Thank you kindly, Mr. Chairman. Ms. Dixon, welcome. I have got a question that is triggered by something that you 

said, which is, well, why did our unemployment insurance system 

grow up in such a way that it is decentralized in the 50 states rather than being one national program because it seems like the problems are just legion with doing it that way. 

Ms. DIXON. So, the reason is because the Southern planter class 

in the 1930’s would not have approved a program of that nature. 

There were actually proposals to make it a universal program, to 

make it paid for out of general fund dollars, and those were not 

adopted because the Southern states did not want people of color, 

black people in particular, to have access to this program. They 

wanted the control to be able to decide who qualifies and who does 

not. 

Mr. RASKIN. I mean, to my mind, it is almost like having 50 different Social Security programs or 50 different Medicare programs, 

right? And we have just been through a period where we have seen 

the brokenness of a system that is that decentralized. So well, 

thank you for clarifying that for me. The bottom line here is that 

expanded unemployment insurance, even with these dysfunctional 

antiquated state systems, allowed millions of people to fill in financial gaps in their lives at a time of unprecedented difficulty and 

loss. Would you share a few examples with us of how expanded unemployment insurance benefited the people that you work with? 

Ms. DIXON. So, though we don’t directly represent workers, I do 

get emails from workers who don’t know that, and often I can refer 

them to legal representation. But it is very, very satisfying when 

the email that you get from a worker is about how grateful they 

are, that this program is in place, that this program got extended, 

and that they are able to focus on their family and their livelihood. 

And so, getting those kinds of emails from workers, it really does 
91 

fill my soul and makes me want to show up every day to do this 

job. 

And so, workers were really organizing around these benefits. 

They were active, they were engaged, and it has been critical and 

phenomenal that they had these benefits to cover their basic needs 

in this, like, you know, once-in-a-century crisis. 

Mr. RASKIN. Got you. Is there anything else you would like to tell 

us before you go? 

Ms. DIXON. Don’t take your foot off the gas in supporting UI administrative funding and providing support for upgrading IT systems and all of the things. On behalf of working people, really 

grateful for the way that Congress came through, and just hope 

that you all, with what you have heard today from me and from 

the other panel, will take seriously the need to invest in the infrastructure of this program so that it can function well without Congress having to step in when there is a crisis or just when there 

is a personal crisis for a family. 

Mr. RASKIN. Thank you for your wonderful testimony and for 

your commitment to the cause. And, Mr. Chairman, I will yield 

back to you. 

Mr. LATURNER. The gentleman yields back. Before we adjourn 

this hearing, I would like to introduce our five subcommittee chairs 

on behalf of Chairman Comer. Congresswoman Nancy Mace will 

chair the Subcommittee on Cybersecurity Information Technology 

and Government Innovation, Congressman Pat Fallon will chair 

the Subcommittee on Economic Growth, Energy Policy, and Regulatory Affairs, Congressman Pete Sessions will chair the Subcommittee on Government Operations and the Federal Workforce, 

Congresswoman Lisa McClain will chair the Subcommittee on 

Health Care and Financial Services, and Congressman Glenn 

Grothman will chair the Subcommittee on National Security, the 

Border, and Foreign Affairs. 

I yield to the ranking member for introduction of his subcommittee ranking members. 

Mr. RASKIN. Well, thank you very much. Mr. Connolly will be our 

ranking member on the Subcommittee on Cybersecurity, IT, and 

Government Innovation, Ms. Bush will be our ranking member on 

Subcommittee on Economic Growth, Energy Policy, and Regulatory 

Affairs, Mr. Mfume will be the ranking member on Government 

Operations and the Workforce, Mr. Krishnamoorthi will be the 

ranking member on the Subcommittee on Health Care and Financial Services, and Ms. Porter will be ranking member on National 

Security, the Border, and Foreign Affairs. 

Mr. LATURNER. I ask unanimous consent that the resolution 

naming the five subcommittee chairs and the five ranking members 

is approved. 

In closing, I want to thank our panelists once again for their important and insightful testimony today. I also want to thank my 

colleagues for participating in our first oversight hearing of the 

118th Congress, an oversight hearing that goes to the very heart 

of this committee’s jurisdiction, protecting taxpayer dollars from 

fraud, waste, and abuse. 

With that and without objection, all members will have five legislative days within which to submit extraneous materials and to 
92 

submit additional written questions for the witnesses to the chair, 

which will be forwarded to the witnesses for their response. 

Mr. LATURNER. With that, our hearing is adjourned. 

[Whereupon, at 3:52 p.m., the committee was adjourned.] 

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