Were Liberals willing victims of fraud?

Were Liberals willing victims of fraud?

On my repeated theme Liberals can’t manage and they're hurting Canada the longer they're in office, we need to be reminded of their huge CERB fraud disaster.

The Liberals pushed an unreasonable amount of money into the Canadian financial system.  The original budget for the CERB program, which ended in 2020, was $24 billion.  But the final cost more than tripled to $81.64 billion.  This partly produced “Justinflation”.  Adding to the fiscal hurt to Canada, much of the emergency COVID aid money spent went to people who were not greatly affected financially by the pandemic.  There was also outright fraud.

CERB was created to aid unemployed citizens from evictions and foreclosures amid the coronavirus pandemic.  Many suffered from the economic lockdowns and needed help, but the government had to admit programs were not properly targeted.

The program was meant to help families who lost income or saw their work hours dramatically cut back when Trudeau took the questionable decision to lock down the Canadian economy.  However, the CERB Act also allowed children to apply, which included Grade 9 students.  The Canada Revenue Agency paid 317,990 different claims for the $2,000 cheques to high school students.  Of those claims, 40,630 were made by Grade 9 students, 92,784 were made by Grade 10 students, and 184,576 claims by those in Grade 11.

There were concerns expressed immediately about likely fraudulent applications, but the government decided the speed and getting the money into people’s hands was a higher priority than any concern over fraud.  Moreover, the government directed the public service to ignore red flags of fraudulent claims, which early on were already numbering thousands.

Banks suspected fraud within weeks of the program launch.  The large financial institutions were reporting on several Canadian emergency response benefits that were coming in with unusual circumstances.  They would see accounts receiving benefits under varied names.  Some accounts would receive multiple CERB cheques going into the same account, and then the money would be quickly dispersed to another institution or quickly withdrawn at an ATM.  Some money apparently went to criminals and scammers with false identities, or people not living in Canada, and some received multiple payments in the same week.

The government was flooded with tips by informants naming suspected cheaters, but the government wasn’t interested.  There were instructions to various institutions and the Canada Revenue Agency, not to follow up.  We hear likely fraud amounts are in the range of $5.3 billion (yes, billion not million) and rising, as reviews continue.

Question:  Why did the department not build more integrity measures upfront into the program?

The answer, in part, was: CERB was launched to address the historically high number of Canadians in financial need due to the COVID-19 pandemic.  The impact translated into a dramatic surge in the number of citizens applying for EI benefits.  It was obvious existing measures to adjudicate claims, with many upfront controls, could not sustain these volumes.

Simplification measures included moving to a benefit flat rate and the interim use of applicant attestations pre-benefit payment over the requirement for receipt of upfront documentary evidence.

A decision was made to shift up-front controls to the post-payment period. Service Canada knew in times of crisis, the risk of fraud is heightened.  However, to ensure Canadians in need received the benefit as quickly as possible, a decision was made to reduce upfront controls and focus on post-payment measures to address cases of fraud.

Then there is the question:  Why will the post-payment verification plan take four years?  The answer, in part, was: The government announced $260 million over four years for ESDC and the CRA to increase the capacity to detect, investigate and address cases of fraud or misrepresentation related to the Canada Emergency Response Benefit.  We have a detailed plan in place for post-payment verification. The priority has been to identify and take measures against those who may have knowingly engaged in fraud/abused the system.  These types of investigations can take time.

The follow-up question: What is the plan for recouping overpayments?  Answer, in part: Service Canada takes the integrity of its programs very seriously and remains committed to the financial stewardship of its programs.  We will use data analytics to identify areas of error or fraud, focusing on areas of greatest risk.  We know errors can happen and we have been made aware of individuals successfully applying for and receiving CERB.  We will work closely with recipients to make arrangements to repay any amounts owing and flexible payment arrangements may be made based on individual financial situations.  Applicants found to have intentionally made fraudulent claims will be required to repay the benefit amounts they received, and may face additional consequences, such as referral to law enforcement.  We continue to strengthen our system to validate and authenticate our clients and prevent personal identification thieves from accessing our programs.

Finally, written questions were tabled in Parliament by MPs, which require a full written answer from the government.  Although there has been sufficient time, as of November 2022 the following question has gone unanswered, which reveals the ugly reality of the Trudeau administration.

Q-808 — Mr. McCauley MP (Edmonton West) — With regard to the Canada Emergency Response Benefit (CERB) and the four-year post-payment verification plan identified in the 2021 Spring Report of the Auditor General: (a) how many recipients of payments under the CERB have been identified as fraudulent or otherwise ineligible; (b) what dollar amount of payments were received by the recipients in (a); (c) what amount of money has been recovered to date in relation to the recipients in (a); and (d) of the recipients in (a), from how many have funds been (i) partially, (ii) fully, recovered?

We're still waiting for the written answer, but clearly, the administration of CERB was a disaster.