Acting Assistant Attorney General Nicole M. Argentieri Delivers Keynote Address at the 40th International Conference on the Foreign Corrupt Practices Act
Five current or former IRS employees have been charged with schemes to defraud the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) Program, federal stimulus programs authorized as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act.
“The IRS employees charged in these cases allegedly abused the trust placed in them by the public,” said Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division. “The Criminal Division is committed to safeguarding that public trust and protecting pandemic relief programs for the American people.”
“This matter demonstrates the brazenness with which bad actors have taken advantage of federal programs meant to help those who suffered most from the COVID-19 pandemic,” said Director for COVID-19 Fraud Enforcement Kevin Chambers. “The Justice Department will continue to work hard to root out PPP and EIDL Program fraud, including that committed by government employees.”
According to court documents, the defendants allegedly obtained funds under the PPP and EIDL Program by submitting false and fraudulent loan applications that collectively sought over $1 million. They then used the loan funds for purposes not authorized by the PPP or EIDL Program, but instead for cars, luxury goods, and personal travel, including trips to Las Vegas.
“These individuals – acting out of pure greed – abused their positions by taking government funds meant for citizens and businesses who desperately needed it,” said U.S. Attorney Kevin G. Ritz for the Western District of Tennessee. “I thank our law enforcement partners for rooting out this fraud. Our office will not hesitate to pursue and charge individuals who steal from our nation’s taxpayers.”
“The Treasury Inspector General for Tax Administration’s (TIGTA) mission includes investigating allegations of criminal violations committed by Internal Revenue Service employees,” said Treasury Inspector General for Tax Administration J. Russell George. “We will continue to aggressively pursue IRS employees who breach the public trust, safeguarding the integrity of the IRS.”
“It is especially egregious when individuals that hold positions of public trust engage in criminal activity,” said Inspector General Hannibal “Mike” Ware of the Small Business Administration, Office of Inspector General (SBA-OIG). “OIG is a ready partner in safeguarding the integrity of SBA’s programs and in bringing wrongdoers to justice.”
The five individuals charged are:
Each count of wire fraud carries a maximum penalty of 20 years in prison, and each count of money laundering carries a maximum penalty of 10 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The TIGTA and SBA-OIG investigated the cases.
Assistant Chief Justin Woodard and Trial Attorneys Sara Porter, Kelly Z. Walters, and Thomas D. Campbell of the Fraud Section’s Gulf Coast Strike Force and Assistant U.S. Attorney Carroll Andre for the Western District of Tennessee are prosecuting the cases.
These cases were brought as part of an interagency effort to combat and prevent CARES Act fraud by federal employees. The initiative is led by the U.S. Department of Justice’s Criminal Division, Fraud Section, U.S. Attorneys’ Offices, and agents with TIGTA and SBA-OIG.
The Fraud Section leads the Criminal Division’s prosecution of fraud schemes that exploit the PPP. Since the inception of the CARES Act, the Fraud Section has prosecuted over 150 defendants in more than 95 criminal cases and has seized over $75 million in cash proceeds derived from fraudulently obtained PPP funds, as well as numerous real estate properties and luxury items purchased with such proceeds. More information can be found at https://www.justice.gov/criminal-fraud/ppp-fraud.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) hotline via the NCDF Web Complaint Form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
An indictment or information is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.