Fraud, grift, scams, and bamboozlements are at an all-time high. It’s not just crypto, NFTs, stocks and online career gurus:
They bought Lamborghinis, Ferraris and Bentleys.
And Teslas, of course. Lots of Teslas.
Many who participated in what prosecutors are calling the largest fraud in U.S. history — the theft of hundreds of billions of dollars in taxpayer money intended to help those harmed by the coronavirus pandemic — couldn’t resist purchasing luxury automobiles. Also mansions, private jet flights and swanky vacations.
They came into their riches by participating in what experts say is the theft of as much as $80 billion — or about 10 percent — of the $800 billion handed out in a Covid relief plan known as the Paycheck Protection Program, or PPP. That’s on top of the $90 billion to $400 billion believed to have been stolen from the $900 billion Covid unemployment relief program — at least half taken by international fraudsters — as NBC News reported last year. And another $80 billion potentially pilfered from a separate Covid disaster relief program.
The prevalence of Covid relief fraud has been known for some time, but the enormous scope and its disturbing implications are only now becoming clear.
Even if the highest estimates are inflated, the total fraud in all Covid relief funds amounts to a mind-boggling sum of taxpayer money that could rival the $579 billion in federal funds included in President Joe Biden’s massive 10-year infrastructure spending plan, according to prosecutors, government watchdogs and private experts who are trying to plug the leaks.
“Nothing like this has ever happened before,” said Matthew Schneider, a former U.S. attorney from Michigan who is now with Honigman LLP. “It is the biggest fraud in a generation.”
“The Small Business Administration, in sending that money out, basically said to people, ‘Apply and sign and tell us that you’re really entitled to the money,’” said Horowitz, the chair of the Pandemic Response Accountability Committee. “And, of course, for fraudsters, that’s an invitation. … What didn’t happen was even minimal checks to make sure that the money was getting to the right people at the right time.”
The criminal methodology varied depending on the program. The epic swindle of Covid unemployment relief has been carried out by individual criminals or organized crime groups using stolen identities to claim jobless benefits from state workforce agencies disbursing federal funds. Each identity could be worth up to $30,000 in benefits, Horowitz said.
The basic scheme, Talcove said, was “really simple.” People went on state websites and took the names of existing businesses or registered new, fake ones.
“There’s absolutely no security on there. There’s no validation of any information,” Talcove said. “And voila, you have company ABC with 40 employees and a payroll of $10 million. And you go and apply for a PPP loan. It was a piece of cake.”
David Hines, 29, of Miami, for example, admitted to a fraud scheme that netted him $3.9 million, according to his guilty plea. Hines, who said in court papers that he struggled with addiction, bought a $318,000 Lamborghini Huracán. He also spent thousands on luxury hotels, jewelry, clothing and dating sites, say prosecutors, who seized the car and recovered much of the money.
Also in Miami, a man and a woman admitted to a complex scheme in which, among other things, they claimed they were operating farms — with many employees — out of small, single-family homes in the middle of the city.
“Once you looked at the paperwork and once you saw what it was, all it took was a drive to the farm to see there was no farm,” Gonzalez said.
In another Florida case, prosecutors have charged a man who they say used proceeds from a $7.2 million emergency loan to buy a 12,579-square-foot mansion, a Lincoln Navigator car, a Maserati and a Mercedes-Benz.
A California couple were convicted in June of stealing $18 million, with which they bought three houses, diamonds, gold coins, luxury watches, expensive furniture and other valuables, prosecutors said. Just as they were to be sentenced, they cut off their ankle bracelets and fled, leaving their children behind, according to the FBI.
They were captured in February in Montenegro. The man was sentenced to 17 years in prison, and his wife got six years.
Hines got six years in prison, and the fraudulent farmers got 18 and 30 months. But Gonzalez and other government officials acknowledge that for every person caught, many, many more have gotten away with it. And while prosecutors have 10 years to go after the fraud, given the enormous scope of the criminality, the Justice Department simply doesn’t have the resources to go after it all.
“I think there’s going to be a percentage that we probably will never catch,” he said. “But we’re working as hard as we can to catch as many as we can.”
Across the country, only 178 people have been convicted so far in PPP fraud cases, according to the Justice Department. Many more prosecutions are coming, but even if the numbers reach 2,000 — or 20,000 — it will be only a small fraction of the fraud.
It goes on and on. But you get the picture.
How was this allowed to happen?
Because the US government simply doesn’t care anymore. The mask is completely off.
The name of the game now is to loot this country for every last dime before the wheels fall completely off.
They’re going to bleed this country dry.
They know we’re heading for a massive crash, and so they figure why not at least try to get rich in the process–get a cut of the action while the gettin’ is good.
Here’s the thing: this NBC News article lists off a number of different cases of fraud, with several examples provided of people stealing millions and millions of dollars.
But the article itself said the total amount of money defrauded amounts to hundreds of billions.
The article is trying to make it seem like the fraud was mostly done by random people.
It wasn’t. The scale is much larger than this article lets on. I’m talking about corporate-level fraud.
And of course the government is going to go after the low-level fraudsters and con artists, they’re the easy targets.
But the wealthier and more sophisticated scammers will never be touched. They’ve got armies of lawyers at their disposal.
The PPP fraud was not incidental–the fraud was the point. This was not a bug, it was a feature.
There’s no great mystery here as to how this could have been allowed to happen–it was intended.
They’re trying to bleed the country dry before it collapses.