Kansas’ delegation to U.S. House united behind COVID-19 anti-fraud legislation

TOPEKA — The Kansas delegation in the U.S. House voted for bipartisan bills extending the statute of limitations to 10 years for prosecution of fraud in a pair of COVID-19 relief programs providing business loans.

Democratic Rep. Sharice Davids and Republican Reps. Ron Estes, Jake LaTurner and Tracey Mann voted Wednesday for legislation designed to give law enforcement more time to investigate illegal activity in the Paycheck Protection Program and the Economic Injury Disaster Loan program.

“We need to hold fraudsters accountable for taking advantage of the pandemic for personal gain,” Davids said. “These bipartisan bills will provide federal, state and local law enforcement agencies with ample time to identify and prosecute fraud. We can’t let up on our oversight of taxpayer dollars and I’ll continue to target waste and abuse in the system where possible.”

Davids, a member of the House Small Business Committee, said the legislation forwarded to the U.S. Senate was important given the scope of estimated fraud. Nearly $1 million in Economic Injury Disaster Loan payments were claimed in the name of Johnson County residents in 2021 through identity theft, Davids said.

The EIDL measure would establish the 10-year statute of limitations for criminal charges and civil enforcement of fraud involving the disaster loans and advances.

Under the PPP legislation, the statute of limitations for individuals engaged in fraud also was set at 10 years. The U.S. Small Business Administration’s office of inspector general identified 70,000 PPP loans nationwide valued at $4.6 billion that were potentially fraudulent.

Banks and financial technology companies with lending partners were allowed by Congress to process PPP loans. The U.S. Department of Justice said financial technology companies were involved in 15% of PPP loans, but handled an estimated three-fourths of loans connected to fraud.