Justice Department Cracking Down on Coronavirus Aid Fraud as Losses Top $8 Billion

The U.S. Department of Justice is taking stringent measures to combat widespread fraud it has discovered in connection with federal aid programs adopted during the COVID-19 pandemic. The alleged fraud, which touches nearly all types of aid provided for families, workers and businesses, amounts to at least $8 billion, according to the DOJ.

In response, the DOJ is ramping up its efforts to stem the tide of fraudulent use of COVID-19 funds. It has appointed a Director for COVID-19 Fraud Enforcement, whose top priority will be to create strike teams that will employ technology and analytics tools to “connect the dots on identity theft and other complex fraud schemes” around the nation. The new director, Associate Deputy Attorney General Kevin Chambers, plans to focus on large-scale criminal enterprises that are said to have committed such forms of COVID relief fraud as these:

• Wrongfully obtaining Paycheck Protection Program (PPP) loans on behalf of nonexistent companies
• Fraudulently obtaining Economic Injury Disaster Loans (EIDL), which were designed to help small businesses recover from the impact of COVID-19
• Stealing workers’ identities to obtain enhanced unemployment benefits under someone else’s name
• Selling fake COVID tests or supposed cures and then submitting fraudulent Medicare claims for reimbursement

Prior to Chambers’ appointment, the DOJ had already charged more than 1,000 people with fraud-related crimes and seized more than $1 billion in fraudulently obtained EIDL proceeds. Additionally, more than 1,800 people have been subject to civil investigations connected to pandemic relief misconduct.

The strike teams led by Chambers will be using sophisticated analysis of transactions and combing through mountains of digital data to uncover allegedly criminal behavior. They will bring serious charges against anyone believed to have been involved in fraud, conspiracy and other crimes related to pandemic relief. Most, if not all, cases that arise from the coming wave of investigations will be prosecuted in federal court, where mandatory minimum sentences are a possibility for certain crimes. As such, anyone who is under investigation or gets arrested for a COVID-19-related offense should retain a qualified defense lawyer with experience in federal economic crime cases.

At the Law Offices of David Jay Glassman, we are ready to assist anyone in Pennsylvania who finds themselves caught up in the COVID-19 fraud dragnet. Our founding attorney has more than 40 years of experience handling cases in federal court as both a prosecutor and defense lawyer. We have successfully defended clients against allegations of fraud, embezzlement, money laundering and similar federal crimes. Call our Philadelphia office 24 hours a day at 215-563-7100 contact us online and we’ll respond to your situation as quickly as possible.