Investigation Briefing: Justice Department Continues Aggressively Prosecuting COVID-19 Fraud | Arent Renard


In addition to the ever-increasing number of fraud charges brought under the SBA’s PPP program, recent indictments issued across the country in connection with Covid-19 unemployment benefits and loans in case of economic catastrophe further testify to the DOJ’s continued priority to prosecute Covid-19 related fraud.

Covid-19 unemployment benefit fraud charges

The Justice Department has charged a Texan woman with wire fraud over her alleged involvement in a fraudulent scheme to obtain Covid-19 unemployment assistance. The CARES law, previously described here, created a federal temporary unemployment insurance program, in this case administered by the Massachusetts Department of Unemployment Assistance, called Pandemic Unemployment Assistance (PUA). The PUA provides unemployment insurance benefits to people who are not eligible for other types of employment benefits. According to the Department of Justice press release, the defendant, a resident of Texas, wrongly claimed Massachusetts unemployment benefits, which she received through the Texas Workplace Commission, and she allegedly granted other claims unemployment by using stolen identities to obtain benefits to which she was not entitled. get.

Another woman in California recently pleaded guilty to conspiracy and aggravated identity theft for submitting fraudulent unemployment insurance claims to the California Employment Development Department using the identities of current inmates at the Central California Women’s Facility (CCWF) . The defendant, who was on parole, received personal identification information of CCWF inmates from a current CCWF inmate (who was also indicted) and then submitted unemployment insurance claims that falsely represented that detainees held various jobs, although detainees were incarcerated and not eligible for unemployment benefits.

Read DOJ press releases here and here

SBA Economic Disaster Loan Guilty Plea

A North Carolina woman recently pleaded guilty to wire fraud for fraudulently obtaining an Economic Disaster Loan (EIDL) – intended for existing businesses affected by the Covid-19 pandemic – based on false information. Specifically, the defendant submitted a fraudulent loan application to the SBA for a disbanded online clothing retail business that contained false income information and included a fraudulent tax document. As a result, the defendant obtained a disaster relief loan of $ 149,900 which it then used in retail stores and several diamond stores.

Read the DOJ press release here.

Pharmacy owner sentenced to 36 months for healthcare fraud

The owner of a pharmacy in Queens, New York was sentenced to 36 months in prison for participating in a healthcare fraud conspiracy, distributing oxycodone and engaging in financial transactions illegal after pleading guilty to these charges in September 2020.

According to the DOJ press release, for more than three years, the pharmacy owner falsely claimed to be a pharmacist and dispensed drugs, including controlled substances and over 10,000 Oxycodone pills, without medical supervision. , and billed Medicare and Medicaid for these drugs. His pharmacy was reimbursed about $ 3 million by Medicare and Medicaid. In addition, he paid a licensed pharmacist to introduce herself as the full-time pharmacist at the pharmacy, even though she only visited the pharmacy sporadically. The licensed pharmacist also pleaded guilty, in September 2020, to her role in the scheme, specifically conspiring to defraud Medicare and Medicaid and making a false income statement.

Read the DOJ press release here.

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