Fraudsters are raiding COVID-19 relief
South Florida leads the nation in fraud involving COVID-19 relief programs, with fraudsters using the money for luxury purchases and, in one case, a bar and lounge, prosecutors say.
Prosecutors have filed 38 cases over the past year, including 18 in the past month alone, according to the U.S. Attorney’s Office in Miami.
More than $75 million has been defrauded in the $2.2 trillion economic relief bill known as the Coronavirus Aid, Relief, and Economic Security Act, or CARES.
The legislation provided emergency financial assistance to Americans suffering the economic effects of the COVID-19 pandemic. But the Department of Justice and IRS said Friday that fraudsters in South Florida have taken advantage of the program.
Many of the case were discovered, the Department of Justice said, because as soon as act was passed law enforcement began to look into where the money was going.
“Our work has just begun, and we will continue to work together with our partners to hold accountable those who try to cheat South
Floridians of much needed relief money,” said Ariana Fajardo Orshan, U.S. attorney for the Southern District of Florida.
According to the Department of Justice, the money is being stolen in three key ways.
■ Business owners inflate payroll expenses to get larger loans through the Paycheck Protection Program.
■ Serial fraudsters use dormant corporations and shell companies to apply for multiple loans.
■ Organized criminal networks submit identical loan applications under the names of different companies.
Fraudsters also are using newly created or non-existent businesses to apply for another type of small business loan that was supposed to help agricultural and non-profit companies. People also are using stolen identities to apply for big chunks of the more than $860 billion in federal aid targeted to unemployment workers.
One of the recent cases filed in federal court charged Johnesha Travis, 21 of Fort Lauderdale.
According to a criminal complaint, Travis and accomplices got a paycheck protection loan of $152,605 for their company, Luxury Yacht Rentals Plus LLC, using fake documents. Luxury Yacht Rentals Plus LLC did not have real employees, and the money was blown on restaurants and hotels, according to the complaint.
Leonel Rivero, 35 of Miami, was accused of similar scheme. Rivero owned a tax preparation business in Hialeah Gardens and submitted 118 fake loan applications for himself and his accomplices, according to court filings. Rivero and his accomplices are accused of receiving almost $1 million through the program.
Kenbrell Armod Thompkins, 32, of Miami, is accused of using stolen identities of Florida residents to get unemployment benefits from California, according to federal court filings. California paid out $300,000 in unemployment funds in the form of debit cards, which were mailed to addresses associated with Thompkins in Miami.
Thompkins, a former NFL wide receiver, is accused of using the debit cards to withdraw about $230,000 from ATMs in Miami, according to court filings.
In one of the larger cases, Yashica Sherea Bain, 38, of Miramar, is charged with being part of a scheme that netted nearly $18 million in fraudulent loans.
A criminal complaint says Bain used fake documents to get a $415,000 loan for her eyebrow studio. But instead of using the money for the business, she paid herself and bought a bar and lounge in Miami.
According to the complaint, Bain and others submitted at least $34 million worth of additional fake loan applications. Many were approved and funded, paying out at least $17.6 million.