KANSAS CITY, Mo. — Vice President JD Vance announced Monday that the Trump administration will prohibit approximately 870,000 individuals suspected of defrauding pandemic-era small business initiatives from obtaining future federal loans. The move targets borrowers accused of siphoning taxpayer funds through schemes tied to programs established during the coronavirus crisis.
“If you screwed the American taxpayer, the federal government is now going to say you’re cut off, no more,” Vance told reporters. “You shouldn’t be applying anymore, and if you do apply, you’re no longer able to get those benefits.”
The announcement coincided with the Justice Department’s release of results from “Heartland fraud surge,” a nationwide enforcement campaign conducted from June 12 through Sept. 1. The operation resulted in legal actions involving more than 160 defendants and addressed approximately $245 million in intended losses to taxpayers. The initiative involved prosecutors from 44 U.S. Attorney’s Offices and over 20 federal and state investigative partners.
Attorney General Todd Blanche told CBS News that the department now has 500 prosecutors across all 93 U.S. attorneys’ offices dedicated to these cases. “What we’re saying now is, yes, you do. You do have the time. You do have the resources. You need to take that case and investigate it,” Blanche said, noting that funding and staffing levels have improved since the programs ended.
During the surge, federal authorities pressed felony charges against nearly 80 defendants in cases involving roughly $100 million in intended losses linked to Small Business Administration (SBA) programs, including the Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL) program. Additionally, about 43 defendants pleaded guilty in SBA-related fraud cases involving approximately $44 million in intended losses, while roughly 40 defendants were sentenced in cases involving nearly $100 million in intended losses.
The cases encompass a wide array of alleged schemes, including the creation of fictitious businesses, submission of false payroll and revenue data, and identity theft. Notable prosecutions include Jamie Gray, charged in the Western District of Missouri with wire fraud and money laundering in a scheme totaling nearly $56 million in intended losses. Prosecutors allege Gray submitted PPP and EIDL applications claiming ownership of dozens of businesses, many of which did not exist prior to the pandemic eligibility deadline.
In another case, a federal grand jury in the Northern District of Iowa indicted Adrian Rafael Pupo Perez and Helen Yaima Leyva Santiesteban on 47 counts of wire fraud, money laundering, and conspiracy. Authorities claim the pair participated in a sweeping scheme involving approximately 470 fraudulent PPP applications submitted under names of individuals across the country. The group allegedly sought more than $4.5 million in PPP funds, with about $2.4 million already disbursed. Both defendants remain at large.
The PPP was established by Congress in March 2020 to prevent business closures as pandemic-related shutdowns disrupted the economy. Backed by the SBA, lenders issued roughly 11.8 million loans totaling about $800 billion. While loans could be forgiven, borrowers were required to meet strict criteria, such as using funds for payroll. However, government safeguards were not fully implemented until January 2021, after more than $525 billion in loans had already been approved.
In 2023, the SBA inspector general estimated that more than $200 billion in PPP and EIDL funds may have been directed to potentially fraudulent actors. A March 2025 Government Accountability Office report found that about two million of nearly three million fraud referrals contained incomplete, incorrect, or duplicative information, hindering investigative efforts.
Deputy Attorney General Colin McDonald stated that the U.S. has conducted over 1,200 major fraud actions in the last 160 days. The Justice Department also established a National Fraud Detection Center last month to analyze data from various agencies. Congress previously extended the statute of limitations for investigating PPP and COVID-related fraud to 10 years, allowing prosecutors until 2030 or 2031 to bring additional cases.
Vice President Vance, Attorney General Blanche, and FBI Director Kash Patel appeared with federal and state law enforcement officials in Kansas City to highlight the operation’s results. The announcement serves as part of a broader administration effort to combat fraud in taxpayer-funded programs, including the creation of a National Fraud Enforcement Division earlier this year.
“Every one of these arrests, every one of these takedowns … we are saving money for the American people — real money, millions and millions and millions of dollars,” Blanche said. McDonald added that the fraud task force continues to expand. “They demand our best. They demand our resources. They demand that we take it personally when someone decides to steal from the United States of America, and we will not shrug our shoulders at such conduct,” he said.
Suspected fraudsters? Does that mean they get fined or go to jail? The line here feels blurry.
Finally some accountability. Taxpayer money should never be wasteable on obvious scams.