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Churches Caught in Cares Act Covid PPP Loan Fraud

Updated: Sep 19, 2022

Unfortunately, churches will get caught in Cares Act Covid PPP Fraud.

COVID PPP Loan Fraud Explained

Covid19 ravaged the entire world beginning at the end of 2019. Although there were many denials to begin with, it is generally agreed this virus came from a lab. The public does not know how it escaped but it did.

There has never been a time in recent human history when the entire world was locked down and affected by a single virus.

As is always true, money became the reason many decisions were made and not what was best for humanity. In the United States, as well as around the world, people were ordered to stay in their homes to stop the spread.

This caused economic damage into the trillions in a short span of time. If people couldn’t leave their homes, they couldn’t work. If no one was working, the economy grinds to a halt.

The United States government provided a financial package to assist in mitigating this catastrophic financial damage. Of course, this was just a drop in the bucket, but it was something.

As the US government usually does with aid packages, it went too far, and fraud occurred. This Cares Acts relief was in the form of both the Paycheck Protection Program and Economic Injury Disaster Loans.

This financial bailout was available to both individuals and businesses.

Here is the program explained:

As with everything so massive, fraud entered the picture. The US government estimates that there was between $75 billion and $100 billion in fraudulent claims. I am sure that number was multiples higher.

The church dipped their toes into this government program as well. Let me be clear, as with any other business, the church has expenses. Churches suffered from the lockdown like other businesses so participating in COVID relief was not the issue.

However, many churches received money, and didn’t do the Godly thing with it.

This program was meant to assist in payroll expenses and other normal operating costs.

Although it’s been said: “money is the root of all evil,” that is not what Scripture teaches.

The Holy Bible says: “it is the love of money that is the root of all evil which some have a lusted after having aired from the faith and pierced themselves through with many sorrows” (1st Timothy 6:10).

Church Pastors Received Money Twice

Typically, Boards of Trustees and/or Church Pastor applied for this economic relief on behalf of the church. I was on a call with a group of church Pastors and the subject of this economic relief was brought up.

The president of our convention made the statement: “you Pastors need to go and get some of this money.”

He was encouraging us to receive both parts of the loans: EIDL and PPP. Although it may not be widely known, many church leaders have ministry interests beyond the churches they lead.

First, is that of leading a congregation proper. Next, is what I refer to as “side ministries.” These are ongoing enterprises whether Ministers are currently Pastoring or not.

This practice was more pervasive than I initially understood. I found a tool which reveals the name of every recipient of Cares Act funding online. Names of a few local church leaders were on this list with the amounts received.

It seemed a Pastor could receive money as a church leader if they were considered employees of the church. They could also receive money as leaders of “side ministries." Most did to the tune of $20,000 per relief package!

That they never really paid themselves prior to COVID Cares Relief was irrelevant. The money was there, many lied to get it, so what's the harm?

Here is the search tool which allows locating recipients by name, business, and zip code: (click on image)

For clarity’s sake, our church never applied for, nor received any funds.

The reasons were numerous however, and although we are a micro church, we had just enough money to operate.

Further, Pastors (like me) are not the ones who typically sign fiduciary documents to receive such funding. It is Church Trustees which do so and are legally obligated by such signatures.

A friend of my wife was a trustee at a church in Denver, Colorado some years ago. She signed documents, at the behest of her Pastor, and ended up personally liable to the IRS. Although she never explained what happened, she lost her home as a result.

Worse, when agents showed up and confronted them, the Pastor simply stood up, walked out, left the church, and suffered no repercussions. Well, not on this side of existence anyway.

I point this out because congregants must realize their level of responsibility in these situations.

I wouldn’t ask anyone to sign such a document understanding the consequences. Although money appears easy to get, the government has requirements for receiving it.

Further, and in clarity, if it were me who could sign for these loans, which were forgivable, I certainly would have.

But that is not how churches are set-up. If Pastors ask God’s people to be involved like this, they must conduct themselves above reproach and have some accountability in the process.

Paycheck Protection Fraud Church Examples

Unfortunately, some church leaders, with more to come, forgot what Scripture teaches on these matters. Again, I understand the church has expenses.

However, if your church had money in savings or other investments, why receive government funds?

The answer is simple: greed!

This teaching is pervasive in our churches right now. An example which teaches "get money or you are not blessed" is the false prosperity gospel teaching.

God supplied but apparently, it wasn't enough and his Preachers turned to stealing in order to survive (I mock surely).

Here is an example of church fraud:

I could lecture, preach, and scold with respect to how wrong this truly is in the eyes of God. As a Pastor however, I realize how truly uninterested church leaders who do these things are in the Word of God.

They would never be in the situation had they listened to the Holy Spirit to begin with.

Here is another example of church fraud:

This only scratches the surface of things to come.

My concern, as a Preacher of the Word of God, is the damage this does to the witness of Jesus. Unlike almost every other kind of business, the church gives people hope and depends on that being enough to keep our doors open.

Sometimes it is but at other times it simply is not. The damage COVID 19 Loan fraud will do to the cause of the cross is incalculable.

President Joe Biden Prosecutes Cares Act Fraud

Although unnoticed by most in houses of worship, President Joe Biden recently signed a new Covid fraud bill into law.

Part of this bill extended the statute of limitations for Cares Act/COVID Relief fraud from five (5) years to ten (10).

It is worth noting that this was at the same time 87,000 more IRS agents were funded. So, 87,000 more agents were hired to supposedly go after “wealthy Americans” and the President extends COVID 19 Fraud prosecution simultaneously?

Let us not forget that President Barack Obama said his tax hike was ONLY for wealthy Americans as well! A few months after the bill was passed and signed, the IRS came knocking at our doors for 2% more in taxes.

I am far from wealthy and represent the average American earner I assure you.

Nevertheless, in business there is a concept called “low hanging fruit.”

This means you pick the fruit that is easier to reach before reaching for the more difficult. For instance, if you've picked apples, there are branches with fruit low enough to reach up and pick.

For apples higher up, being more difficult to get to, you need a ladder.

A previous church example of Covid Relief fraud was in the millions. Those cases are more extensive and although not terribly difficult to prosecute, the expense and effort is far greater than lower amounts.

Judging by someone I personally know who is guilty of this, most amounts to be discovered will be much lower. They will range from $20,000 up to $500,000. These are “low hanging,” easy to pick fruit.

These churches don’t have the money to hire expensive lawyers and will simply pay the money back if they receive a payment demand.

Truly, it wouldn’t matter if the amounts were only $500 to $1000 - the damage is still done. Many church leaders and trustees will lose property, homes, and other items when the government comes.

Although I would never celebrate this, I think they should! This fraud was not necessary and unacceptable greed from those who preach against such things. Worse, many who were considering faith in Jesus will turn away when this is exposed.

I realize people are looking for excuses to stay away from the church, but we should never provide them cause.

As I sit here imagining the humiliation when Houses of Worship are raided, I am deeply saddened. To even think that the United States government is going to raid a church for stealing is too much to bear.

How Churches Run the Scam

Yes, I understand that title is shocking! However, earlier in this article I described the statement of a Pastoral leader. He said: “you better get some of that money for your ministries.”

Again, there is no harm with that statement if needed and used in the way intended.

When I used the federal tool to search who received funds (above), I noticed a few patterns.

First, and whether a religious institution or not, many incorporated businesses or ministries after the Cares Act became available.

This means they had no registered business prior and would have been ineligible. Banks were so busy processing loans; they simply didn’t have time to validate whether a business was legitimate or not.

One church leader received thousands by listing three employees at his church. Yet it is doubtful that at two of them were brought back and paid. This fraud receives money by listing laid off employees or nonexistent ones.

I understand COVID relief was meant to avoid layoffs. However, what if those employees were laid off long before Covid? I have no doubt this leader put the money in his own pocket.


The Bible says: “God gets no pleasure in the death of the wicked.” This stretches further than just physical death into the places of the death of one’s Christian witness as well.

When God’s witness is hurt through the actions of claimed disciples, it will cost someone their eternal soul.

I point this out because I am not celebrating nor enjoying what I know is coming. Truthfully, I am not sorry for church Pastors and will reap the rewards of their actions.

They claim to know God’s word, ignored it, and will be justly exposed.

I am truly heartbroken because it’s going to cost all of us something. Many did not even need those funds to begin with.

How could I know that?

Our church has 40 members who are mostly elderly, living on Social Security, and we survived without COVID Relief. Some church leaders claim when the virus closed churches, donations went up!

That is not at all shocking to me.

I have seen the Saints of Jesus come through more times and I can count in this way.

Finally, church trustees should be concerned. I spoke earlier about a friend of my wife’s who lost her home to the IRS because of a Pastor’s fraud.

Once your church is raided, the Internal Revenue Service is going to want to speak to you. Although your Pastor may have some culpability, the lion’s share will be yours. As has been done many times before, it will again.

That wolf trustees followed will simply pack his bags, leave, and go somewhere else while you suffer.

Header Image Courtesy of Gerd Altmann @ Pixabay

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