Those who suspect PPP fraud or may have been a victim of such fraud should contact the National Center for Disaster Fraud (NCDF) hotline at 866-720-5721. Whistleblowers Said This Company Is a Fake Small Business. GOODWILL INDUSTRIES OF NORTH LOUISIANA INC. Unlike the previous round of the PPP, loan guaranty approval is now contingent on passing SBA fraud checks, Treasurys Do Not Pay database, and public records, the fact sheet states. Sah submitted falsified tax and payroll documentation in which he claimed to have numerous employees and hundreds of thousands of dollars in payroll expenses, according to a Justice Department press release, but none of the businesses he sought loans for had any employees. Barbershops were one of the most common businesses to apply. NGUYEN, 44, and VICTORIA HO, 31, both of Hicksville, New York, and DAT HO, 33, of the Bronx, New York, are each charged with one count of conspiracy to commit bank and wire fraud, which carries a maximum sentence of 30 years in prison; one count of major fraud against the United States, which carries a maximum sentence of 10 years in prison; and one count of conspiracy to make false statements, which carries a maximum sentence of five years in prison. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge. If a company is eligible for a loan and submits certifications in good faith, that company will have nothing to fear from the Civil Division. Filed under investigation But, in contrast to the False Claims Act where the reward is a minimum 10% of the recovery, FIRREAs whistleblower reward is capped at $1.6 million. (He also applied for a separate loan just days before being indicted.) At least one Small Business Administration employee allegedly took bribes last year to process fraudulent Economic Injury Disaster loans, according to criminal charges recently unveiled by the Justice Department related to the developing scandal involving Representative Matt Gaetz (R-FL). Businesses applying for a PPP loan must provide documentation to confirm that they have previously paid employees the compensation represented in the loan application. My feeling is that despite the fraud, the program helped far, far, far more of my people than it hurt, said Kennedy. More than half of that amount$246 millionactually went to accused fraudsters. Nick Schwellenbach is a Senior Investigator at POGO. You have to understand from the lenders perspective, really, theyre just looking at income. April 15, 2021. If approved, the SBA pays the lender back using federal funds. The United States Attorneys Office would also like to acknowledge the assistance of the Veterans Administration, Office of the Inspector General; United States Department of Labor, Office of the Inspector General; United States Department of Homeland Security, Homeland Security Investigations; and the United States Secret Services Cyber Fraud Task Force, consisting of the Jefferson Parish Sheriffs Office, Lafourche Parish Sheriffs Office, Thibodeaux Police Department, and the Louisiana Bureau of Investigation with this matter. In another case, a Virginia resident obtained over $2.5 million from the Paycheck Protection Program and used the funds to buy not only a luxury car but a private plane. 61000. A .gov website belongs to an official government organization in the United States. woman indicted for preparing 110 fraudulent PPP loans. But, in the Economic Injury Disaster Loan program, the Small Business Administration has not conducted robust data analysis to find instances of loans and grants that may have been fraudulently obtained, according to the Government Accountability Office. Assistant United States Attorneys Michael C. McGinnis and Sagar K. Ravi are in charge of the prosecution. Another large identity theft case led to charges against Jeremie Saintvil of Delray Beach, Florida in March. Faa sua busca no site. Act 311 of the 2020 Regular Session of the Louisiana Legislature allocated federal CARES Act funds to provide grants of up to $15,000 to eligible small businesses through a program administered by the Louisiana Department of Treasury. Investigators say those accused made false statements about things like how many people they employ, their average monthly revenue, and payroll figures. mike vernon royal household; are there snakes in gran canaria; shooting in laurel, md yesterday. When they believe they have unearthed sufficient evidence to allege the government has been defrauded, these individuals file qui tam lawsuits, Grossman said. In fraud cases where there is no apparent misuse of a loan, civil enforcement may be more likely than criminal prosecution. We have a lot of qui tam cases that have been brought forward, Grossman told POGO, generally referring to False Claims Act complaints filed by private individuals. In connection with loan applications for COVID-19 relief available from the Paycheck Protection Program (PPP) of the SBA, the defendants falsely and grossly overstated the number of employees and payroll at their nail salons and other businesses through fraudulent and doctored payroll and tax records in order to obtain larger loans. But in the year since the CARES Act became law, it has received nearly 150,000 hotline complaints, representing a 19,500% increase over prior years, according to a staff memo from the House Select Subcommittee on the Coronavirus Crisis. An internal analysis last fall by the Small Business Administration identified over 2 million approved PPP loan guarantees worth some $189 billion that were potentially not in compliance with the law, though it may turn out that many of those loans were not fraudulent. The line is staffed 24/7. The offices 44 investigators have been working at least three times the caseload that theyre usually used to working. The FBI, Secret Service, Homeland Security Investigations, and other offices of inspectors general are also part of the federal law enforcement effort. As the lending programs ramped up last summer, there was a spike in suspicious activity reports from banks and other lenders flagging potential fraud. Under the False Claims Act (FCA) as well as the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA), either the government or whistleblowers with non-public information can initiate civil enforcement actions. (WAFB) - Since the Paycheck Protection Program (PPP) launched to help businesses pay their employees to prevent great losses due to the COVID-19 pandemic, some people have. Funds disseminated through this program, The Paycheck Protection Program (PPP) established by the CARES Act, provides small businesses with funding for payroll costs, mortgage interest, rent, and utilities. The Justice Department has brought criminal charges against at least 209 individuals in 119 cases related to Paycheck Protection Program (PPP) fraud since banks and other lenders began processing loan applications on behalf of the Small Business Administration on April 3, 2020. Those who suspect PPP fraud or may have been a victim of such fraud should contact the National Center for Disaster Fraud (NCDF) hotline at 866-720-5721. Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justices National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form. Grossman told POGO, we expect a lot more civil enforcement.. AGs Office announces more than 50 arrests connected to Paycheck Protection Program fraud. According to the MITRE Corporation, a mismatched zip code or insufficient award description doesnt seem particularly egregious. Complaints can also be filed online here. Public Information Director Firm estimates of fraud related to CARES Act spending, including the Paycheck Protection Program and the Economic Injury Disaster Loan program, may not be available until many more cases are brought and more analysis has been conductedpotentially years away. The Paycheck Protection Program saved millions of jobs. In connection with these loan applications, the defendants falsely and grossly overstated the number of employees at the Victoria Companies and wages paid to those employees in order to obtain larger loans. Given the focus of the PPP to support employees during the COVID-19 pandemic, the Robinson Bradshaw firm wrote last May, it is easy to imagine how a dissatisfied employee observing imperfect business conduct in securing a PPP loan or applying loan proceeds could use that insider information to bring a qui tam action under the FCA.. Each loan paid out was guaranteed using taxpayer money. Share sensitive information only on official, secure websites. Data analysis could also help the agency assess potential policy changes, and the Biden administration made some changes to make access to relief more equitable earlier this year. The cases involve attempts to steal a total of more than $175 million from the program, with actual losses to the federal government totaling more than $70 million, the DOJ reports. And if theyre not interested in prosecuting, for whatever reason, we dont further pursue it at that time., Many of the cases are moving quickly, despite their complexity. From at least in or about April 2020 through at least in or about June 2020, NGUYEN, VICTORIA HO, and DAT HO engaged in a scheme to submit online applications to at least two financial institutions for a total of over $13 million in government-guaranteed loans for the Victoria Companies through the SBAs PPP. The three Economic Injury Disaster loans Greenberg obtained should have triggered red flags galore. Summary of PPP Loans in Louisiana. The DOJ says falsified tax records were submitted and in some cases, stolen personal information was also used in these attempts to defraud the PPP. According to the Board of Barber Examiners, to legally run a barbershop, an owner must have a business license and a barber license if they are cutting hair even if that business is run out of a home. UNION VETERINARY CLINIC, INC. 65780. In 2020, applicants could not lawfully receive more than one Paycheck Protection Program loan. The DOJ says this ill-gotten money was in many cases used to buy luxury personal items like cars, homes, vacation trips, and jewelry. Help us crowdsource fraud detection in the PPP program! All rights reserved. 8851 center dr la mesa, ca 91942; chamberlain graduation 2023; fun sober things to do on a friday night. Even if the Justice Department declines to join a case, the whistleblower and their private counsel can continue to pursue it. Some of these qui tam lawsuits are traditional whistleblower cases, but others involve individuals who are slicing and dicing the data that has been made available about loans, according to Grossman. I urge anyone who believes he or she is a victim of this type of fraud to report it to the National Center for Disaster Fraud," said US Attorney Brandon Fremin. 217,332 TOTAL PPP LOANS. Its up to the SBA and the Justice Department to go after anyone caught stealing PPP money. When the bank froze the funds, they froze as well, conducting Internet searches for topics related to PPP fraud. About one year after the passage of the CARES Act, $626 million in funds have already been seized or forfeited related to criminal and civil investigations of pandemic loan fraud. They often involve obtaining and then piecing together often-complex financial, payroll, and tax records for individuals and companies, and sifting through other evidence. Rabbitt noted the unparalleled speed with which these cases have been investigated and prosecuted.. As former federal prosecutor Tarek Helou told the Wall Street Journal, The scandal is whats legal, not whats illegal., Lenders may also be more likely to face civil enforcement than criminal enforcement. Copyright 2020 WAFB. That situation may arise in cases of apparent fraud involving Economic Injury Disaster loan advance grants of $10,000 or less. Louisiana has a total of 217,332 businesses that received Paycheck Protection Program (PPP) loans from the Small Business Administration. Acting U.S. Attorney Audrey Strauss said: As alleged, these defendants conspired to rip off the SBAs COVID-relief small business loan program and financial institutions by lying about how many people they employed in their family business and how much they paid those employees. We will also begin processing paper returns downloaded from the LDR website at, The federal Coronavirus Aid, Relief and Economic Security (CARES) Act provided Economic Impact Payments of $1,200 for qualifying individuals and $2,400 for qualifying married couples, with an additional $500 per dependent child. PPP Loans in Raceland, LA - Page 13. At $367 billion, the amount of disaster funds provided through the EIDL COVID program is more than three times the amount of disaster loan funds approved for all disasters combined since the SBA was created in 1953, wrote Jovita Carranza, then-head of the Small Business Administration, in December 2020. Aqeel and others in the scheme allegedly used loan funds to pay individuals they claimed were employees but were actually fake employees, according to a court filing. NGUYEN and DAT HO will be presented in United States District Court for the Eastern District of New York in connection with these and other unrelated charges. We expect to go to trial because of the serious nature of this matter.. However, industry insiders say the barbershop industry is largely cash-based, making it easy to operate under the radar. Between May and October 2020, financial institutions filed more than 21,000 and 20,000 suspicious activity reports (SAR) related to PPP and EIDL, respectively, according to the Government Accountability Office. If youre going to steal money, finite resources from people who need them, then, by God, were going to prosecute you.. All rights reserved. On June 28, 2020, the day loan applications were filed for the two companies, Greenberg reinstated the companies with Floridas state government since they had been administratively dissolved years prior to the February 2020 eligibility cutoff. They have never said they won't seek prison time for below a minimum dollar amount. If you look at the last round [of PPP] and you look at it on a time series, it almost looks like the largest businesses and businesses in high-income neighborhoods received money first and smaller businesses and businesses in low-income neighborhoods received money last, the Small Business Administrations Michael Roth told Politico in March. For instance, in one larger case, the Justice Department has charged 19 individuals to date. Seven of the approved loans were processed by Cross River Bank, a top Paycheck Protection Program lender that closely allied itself with financial technology firms. Making sure that victims of federal crimes are treated with compassion, fairness and respect. Theyre not checking licenses. In Louisiana, a federal grand jury recently indicted a Plaquemine woman named Lestreonia Rodrigue on fraud charges. Data is available, but its reliability for the purpose of assessing whether Paycheck Protection Program loans are reaching the underserved communities that Congress wanted prioritized is limited because the demographic data is incomplete. The rebates, funded by the CARES Act, are subject to Louisiana state income tax. When the government spends money, taxpayers deserve to know how it was spent, Clarion Ledger Editor Marlon A. Walker says. The loans have to be repaid with low interest. The rebates, funded by the CARES Act, Act 311 of the 2020 Regular Session of the Louisiana Legislature allocated federal CARES Act funds to provide grants of up to $15,000 to eligible small businesses through a program administered by the Louisiana Department of Treasury. They determined that a lot of the folks that they have as subjects of their investigations in HHS OIG [for Medicare and Medicaid fraud], were also committing PPP and EIDL fraud, Grossman said. Suspicious activity reports for small business loan fraud continued at levels far higher than normal through the end of 2020, according to POGOs review of federal data. Allegedly misrepresenting the number of employees on their payroll to obtain the funding, they deposited this money into accounts controlled solely by them. Complaints can also be filed online here. The auditor found that the deficiencies were caused by an inadequate entity wide control environment.. 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