Scroll down for GAO report and FTC testimony
Using postcards promising "free government money" and through companies with names like the "Google Money Tree," con men have exploited the government stimulus program to scam millions of dollars out of unwitting Americans.
So far, 270,000 Americans have been affected by stimulus-related scam, according to Federal Trade Commission. Government auditors are currently pursuing investigations into hundreds of allegations of fraud in the stimulus program.
As of September 2, the Government Accountability Office's FraudNet hotline has received 80 allegations "considered credible enough to warrant further review," according to a new GAO report.
The GAO's Forensic Audits and Special Investigations unit is pursuing eight allegations (while another 12 are pending further review) related to wasteful and improper spending, conflicts of interest, supplanting funds and contract fraud. Of the remaining allegations, 38 were found to not address waste, fraud or abuse or lacked specificity and 22 were referred to inspectors general at other agencies.
And the FTC, working with law enforcement, "has filed almost 400 cases or legal actions" involving stimulus scams by "opportunistic fraudsters," FTC chairman Jon Leibowitz told a Senate hearing into stimulus fraud on Thursday.
One example cited by Leibowitz included a Website featuring photos of President Obama and Vice President Biden offering "free government money," and a postcard promised cash for consumers to use to pay bills and travel expenses, reports Bloomberg News.
In another scam, a company named Google Money Tree lured consumers into divulging their financial account information "using the false promise of a lucrative work-at-home opportunity." Though the work-at-home kit only cost $1.99, victims lost hundreds of dollars each through unauthorized recurring monthly charges.
Auditors have estimated that $50 billion of the $787 billion program could eventually wind up in the hands of swindlers and thieves, MarketWatch reported in June.
Read Leibowitz's prepared remarks:
Read the GAO report: