The US Department of Justice has charged 57 people with trying to steal more than $175m from the Paycheck Protection Program (PPP) of emergency loans intended to help small businesses during the Covid-19 crisis.

The charges were brought by the Criminal Division, fraud section, said Brian Rabbitt, acting head of the department’s Criminal Division. Charges have been brought in no fewer than 19 separate judicial districts across the United States.

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Spanning the country, “the cases are diverse in size and scope involving fraud ranging from requests for Just $30,000 to approximately $24m,” Rabbitt said at news conference yesterday.

The charges involve, in addition to attempts to steal over $175m from the PPP, actual losses for the Federal government of over $70m, he said.

Recovery: Seizing funds and liquidating assets

The government has so far been able to recover or freeze over $30m.

The DOJ expects to add to that total in the future as it seizes additional funds and liquidates assets the defendants have purchased using the illegally obtained funds.

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The PPP is a loan designed to provide a direct incentive for small businesses to keep their workers on the payroll. The loans are backed by the Small Business Administration (SBA), a government agency that provides support to entrepreneurs and small businesses.

The SBA will forgive loans if all employee retention criteria are met, and the funds are used for eligible expenses.

The usual suspects: con artists and criminal gangs

The alleged criminals include “individuals or small groups, acting on their own, who lied about having legitimate businesses or who claimed that they needed PPP money for things like paying workers or paying bills, but instead used it to buy splashy luxury items for themselves,” Rabbitt said.

Another group includes coordinated criminal rings stealing large sums of money from the loan program, he added.

Businesses get the loans through any existing SBA lender or through any federally insured depository institution, federally insured credit union, and Farm Credit System institution that is participating.