Wayne Partlow / AP
The Justice Department’s crime department says it has so far charged 57 people with alleged fraud on a federal program designed to help small businesses during the coronavirus pandemic.
Assistant Attorney General for the Criminal Division Brian Rabbitt told reporters that the defendants attempted to steal more than $ 175 million. They actually received more than $ 70 million, he said, and the Justice Department reclaimed or frozen over $ 30 million.
The paycheck protection program, designed to help companies keep workers on their payroll, was approved by Congress in March as the coronavirus crisis loomed. Before it closed to new applications last month, around $ 525 billion in forgeable loans were granted, according to Rabbitt.
“We claim that many of these defendants have taken the aid money offered by the PPP and spent it on things that have absolutely nothing to do with relief,” Rabbitt said. For example: A man from Miami who allegedly received nearly $ 4 million in funds and used some of that money to buy a Lamborghini.
Rabbitt said the cases varied in size and scope. Some were individuals who allegedly lied about the details of their business – or its existence – and then used the funds for “illegitimate purposes” such as buying luxury goods. Others were involved in coordinated crime rings. The money the suspected fraudsters were looking for ranged from $ 30,000 to $ 24 million.
He stressed that the money fraudulently withdrawn from the program was taking away the funds available to the companies that needed it.
These aren’t the only federal cases aimed at containing PPP fraud. US law firms across the country are bringing similar cases.