United States Attorney Jacqueline C. Romero, together with other federal law enforcement officials announced charges against 19 people, including two men from Delaware County, for defrauding federal programs funded by the CARES Act and designed to provide a financial safety net for Americans during the pandemic Collectively these defendants sought to defraud the Paycheck Protection Program (PPP), the Economic Injury Disaster Loan (EIDL) program and the Pandemic Unemployment Assistance (PUA) program of over $ 24 million.
The Coronavirus Aid, Relief, and Economic Security Act, commonly called the CARES Act, was intended to provide emergency financial assistance to the millions of Americans suffering the economic effects of the COVID-19 pandemic.
The PPP authorized banks to provide forgivable loans to small businesses for the specific purpose of enabling the businesses to meet payroll expenses and retain employees.
Under the EIDL program, the Small Business Administration (SBA) provided low interest loans for small businesses to obtain financial relief due to any disruption or harm to their business resulting from the COVID-19 pandemic. The loan proceeds were required to be used on normal operating expenses, such as working capital and payroll.
The PUA program provided emergency unemployment compensation to workers who were unemployed as a result of the pandemic but who were not eligible for regular unemployment compensation.
Each of the 19 defendants is alleged to have defrauded one or more of these programs. As alleged in 4 indictments and 7 informations, each defendant applied or conspired with others to apply for benefits even though they knew they were not eligible for the benefits. They each succeeded in fraudulently obtaining emergency benefits or helping others to obtain emergency benefits. In some cases, the defendants are also alleged to have spent the emergency funds, not to make payroll or for other authorized business purposes, but instead spent the money on personal items.
Francis J. Battista, 37, of Aston, Pennsylvania, filed 19 fraudulent applications for PPP and EIDL loans in 2020 and 2021, seeking over $ 10 million in loans. Battista allegedly supported his fraudulent loan applications by submitting fake tax documents, bank records and payroll He succeeded in obtaining $ 8.4 million in loan funds, and he caused the funds to be spent on unauthorized purchases and debts and laundered a significant portion of the funds. He allegedly used emergency pandemic funds to purchase a Limited Edition CPO Range Rover Sport 4WD The government has located and seized $ 6.3 million of those funds through forfeiture proceedings.
Tai Brown, 19, of Collingdale, Pennsylvania, was charged with theft of public money and the government is seeking forfeiture of $ 44,238 in PUA funds that are proceeds of the offense.
“Our office has been able to bring charges against these 19 defendants, who deliberately defrauded programs of over $ 24 million that were intended to help individuals who lost their jobs because of the pandemic and small businesses that were struggling to survive during the global pandemic,” said US Attorney Jacqueline C. Romero. “Thanks to the hard work of our agency partners in the Covid Fraud Working Group of the Eastern District of Pennsylvania, we are protecting the integrity of our taxpayer funded programs from fraudsters, a priority for our office and our law enforcement partners. ”
“The Covid pandemic has caused serious hardships for so many families and businesses,” said Jacqueline Maguire, Special Agent in Charge of the FBI’s Philadelphia Division. They golden ticket. Together with our partners, the FBI continue to doggedly pursue anyone defrauding the federal government like this. You’ll be prosecuted to the fullest extent of the law, and that’easy money’ won’t seem so easy after all . ””
“The charges announced today show IRS-CI’s commitment to defend the integrity of the pandemic relief programs,” said Yury Kruty, Special Agent in Charge of IRS-Criminal Investigation. “IRS-CI will continue to aggressively investigate those who schemed to defraud these programs that were intended to help struggling individuals and businesses. ”
“An important part of the mission of the Office of Inspector General is to investigate allegations of fraud related to unemployment insurance programs. We will continue to work with the Pennsylvania Department of Labor and Industry and our law enforcement partners to investigate these types of allegations, ”Stated Syreeta Scott, Special Agent-in-Charge of the Philadelphia Region, US Department of Labor, Office of Inspector General.
“Instead of using these government funds to help keep small businesses afloat and provide financial relief to those suffering from the COVID-19 pandemic, these individuals are alleged to have stolen the money for their own personal use and enrichment, taking it out of the hands “HSI is proud to join our partners in the Covid Fraud Working Group as we continue to focus our efforts on uncovering fraud schemes” of those who truly needed it, ”said William S. Walker, Special Agent in Charge for Homeland Security Investigations, Philadelphia. perpetrated during the pandemic. ”
“Attempts to defraud the government, and ultimately our nation’s community members with legitimate businesses within our financial infrastructure, will not go unanswered for,” said US Secret Service Philadelphia Field Office Special Agent in Charge Michael Centerlla. relief funds continue, so will Secret Service investigators and our partners ceaseless investigative work to ensure our national financial environment remains safe and secure. ”
“This indictment demonstrates the commitment of the Treasury Inspector General for Tax Administration to investigate and bring to justice those who would corruptly manipulate and use IRS resources in order to exploit Federal programs for unlawful personal gain,” said J. Russell George, the Treasury Inspector General for Tax Administration. “We appreciate the efforts of the US Department Justice and our law enforcement partners in this effort.
“Fraudsters that conspired to falsify information in order to access funds vital to the nation’s small businesses for personal gain will be brought to justice,” said SBA OIG’s Eastern Region Special Agent in Charge Amaleka McCall-Brathwaite. fraud and protect the integrity of SBA’s programs. I want to thank the US Attorney’s Office and our law enforcement partners for their dedication and pursuit of justice. ”
These cases were investigated by special agents of seven different federal agencies – FBI, Department of Labor Office of Inspector General, Homeland Security Investigations, IRS-Criminal Investigations, United States Secret Service, Small Business Administration Office of Inspector General, and US Treasury Inspector General The Working Group, begun in March 2020 and led by the US Attorney’s Office, combines resources and expertise of nineteen federal intervention and the Pennsylvania. Office of Attorney General to fight pandemic-related fraud. These cases are being prosecuted by AUSA Judy Smith; AUSA Nancy Potts, AUSA David Metcalf, AUSA Nancy Rue, AUSA Tim Lanni and Trial Attorneys David A. Stier and Patrick B. Gushue of the Criminal Division’s Money Laundering and Asset Recovery Section.
A defendant is presumed innocent unless and until proven guilty. An indictment, information, or criminal complaint is an accusation.