More than 7 million Canadians have applied for the Canada Emergency Response Benefit — but CBC News has learned that some of them shouldn't actually be getting the $2,000-per-month payment.
And those receiving the money who aren't entitled to it could be putting their own financial futures at risk.
One Canada Revenue Agency (CRA) employee said she deals regularly with people who aren't qualified to receive the benefit but are getting it anyway.
She said she spoke with a senior collecting a pension who applied for CERB on behalf of herself and her two disabled adult children.
"I noticed all three of them, living in the same household, are getting two $2,000 cheques," she told CBC News. (The second cheques are retroactive payments.)
"So, $12,000 all on the same day. None of them were eligible."
CBC News is not disclosing the CRA employee's identity because she said she fears punishment for speaking publicly about what she's seen.
'Laughing in my face'
To qualify for the CERB, an applicant must be a Canadian resident over 15 years of age who has been forced to stop working because of the pandemic. The applicant also must have earned a minimum of $5,000 over the last 12 months and must expect to make less than $1,000 a month while collecting the benefit.
In many cases, people who don't qualify for CERB are being encouraged or even pressured into applying by family and friends, said the source.
"When I quiz them about it, there's a variety of answers, from laughing in my face [to] trying to establish that there's some loophole," she said.
Few realize that they'll have to pay taxes on the additional income and could see clawbacks of other benefits, such as tax credits or the Guaranteed Income Supplement, the source said.
Some inmates at a jail in Trois-Rivières, Que., have been sent CERB cheques, according to Radio-Canada. Correctional Service officers intercepted the payments when they arrived at the prison.
The federal government said it is aware of that report and maintains such errors would be caught later by CRA.
Ontario credit counsellor John Cockburn said he's also seeing people applying for the emergency benefit who are not entitled to it.
"This is kind of just in its infancy right now," said Cockburn, who works for the Sudbury Community Service Centre.
The risk of clawbacks
He said he fears that as the pandemic crisis continues, and as food and utility bills pile up, more people will apply because they feel a growing sense of urgency.
"I haven't heard any stories of people getting CERB just for the sake of getting $2,000 to buy a new entertainment system," he said.
Cockburn said he also worries about people doing themselves financial harm in the long run by accepting CERB payments to which they are not entitled.
He points to one recent case on which he was consulted — a man on a disability benefit who applied for and received CERB even though Cockburn said he shouldn't have been eligible.
The man's social services case worker found out and convinced him to return the money. If he hadn't, the additional income could have affected his access to disability benefits and subsidized housing, Cockburn said.
'The vast majority of Canadians are honest'
The federal government estimates it will spend $35 billion on the Canada Emergency Response Benefit. No one seems to know how many people may be taking advantage of the system.
One of the federal ministers in charge of the file told CBC News she'd heard anecdotally that some people have applied who should not.
"But I kind of reject that. I really think that the vast majority of Canadians are honest," said Employment and Workplace Development Minister Carla Qualtrough.
Qualtrough did acknowledge the CERB benefit comes with an elevated risk of fraud.
The CERB application process involves answering just a handful of questions — and everyone who applies for the benefit will receive it, the federal government has said.
Claimants are asked to attest that they are telling the truth in their applications, but it will be up to the CRA to verify claims later and claw back funds as necessary.
'We took the risk'
The federal government says its programs experience an overall fraud rate of less than one per cent — but Qualtrough acknowledged that making this benefit easier to access increased the risk of fraud.
"If you make something attestation-based, you are increasing the risk of fraud," she said.
"We knew the risk was there, but it was calculated and we also knew we had to get the money to Canadians. So we took the risk and we're going to work really hard at the back end to minimize what that's going to mean for the government purse."
"There's just enormous political pressure for politicians to get money out the door," said Kevin Page, president of the Institute of Fiscal Studies and Democracy at the University of Ottawa and a former parliamentary budget officer.
Page said Canada has never seen anything like the scope and cost of the programs introduced in recent weeks to limit the pandemic's economic damage.
He said that, given the size of the CERB program and the other relief packages, even a fraud rate of one per cent could cost the federal government billions of dollars.
'There's so much at stake'
"These numbers on fraud, they are going to be large, and public servants know … there's so much at stake with respect to trust of these institutions like CRA or Service Canada. They have to go after and check these things," Page said.
Qualtrough said there are various measures in place to guard against abuse of the system. Federal staff are using social insurance numbers to check for overpayments and cross-checking between programs to ensure people aren't being paid through more than one program.
"There's also just ways we can tell, based on people's T-4s when we do the taxes next year, that if you are getting income during a time for which you're also claiming you had no income, or you had less than $1,000 [in income], we can figure that all out," Qualtrough said.
National president of the Union of Taxation Employees Marc Brière said the CRA will follow up with people who don't qualify for the benefit but receive it anyway, even if they claimed it in error.
"There's a question of trust in this case … we want the money to be processed rapidly to go into people's hands and [the application] is simplified, to say the least," he said. "But that doesn't mean there are not people at work doing verification as we speak and it will continue as time goes by."
Qualtrough expressed sympathy for those low-income Canadians who could wind up making their own financial situations worse by claiming the CERB while unqualified.
"I absolutely share the concern for people who are in that dire a predicament that they [would] be prepared to take that kind of personal risk," she said.
She argued her government has taken steps to help those Canadians, such as boosting the GST credit and the Canada Child Benefit.
She said she continues to believe the design of the Canada Emergency Response Benefit program followed the best approach.
"I also just am very confident in the honesty of Canadians," she said.
Watch | CRA worker says some Canadians taking advantage of CERB: