Since 2020, Chilivis Grubman attorneys have monitored and written about indictments, guilty verdicts, and prison sentences related to COVID-19 relief programs. In September 2020, CG attorneys wrote about then Attorney General Bill Barr’s instruction to the DOJ to focus on pandemic-related fraud and the establishment of a “team dedicated to PPP fraud …” In May 2021, the U.S. Department of Justice established the COVID-19 Fraud Enforcement Task Force to investigate claims of fraud against COVID-19 relief programs. It has been nearly two years since the CARES Act was first enacted in March 2020, yet the federal government continues to aggressively pursue and prosecute COVID-19 related fraud and abuse. And it will continue its efforts.
On February 25, 2022, the U.S. Department of Justice announced another conviction related to COVID-19 relief fraud. According to the press release, Elijah Buoi submitted six fraudulent CARES Act Paycheck Protection Program (PPP) loan applications to four lenders. Evidence was presented at trial showing that Mr. Buoi operated a startup company that had no U.S.-based employees nor U.S.-based payroll. Evidence also established that Mr. Buoi made misrepresentations on the PPP loan applications he submitted. The misrepresentation included the number of employees employed and payroll expenses.
Misrepresentations on COVID-19 relief programs applications appear to be a common method to defraud relief programs and perpetrators are often sentenced to federal prison for their actions. For example, in February 2022, three men were sentenced to prison for up six years, and each was ordered to pay over $498k in restitution for misrepresentations on PPP loan applications. In December 2021, CG attorneys wrote about a Georgia man sentenced to two years in prison for misrepresentations made on applications for PPP loans. Similar to these recent cases, Mr. Buoi faces a potentially lengthy prison sentence. Although the judge will consider U.S. Sentencing Guidelines and other factors when making a sentencing decision, Mr. Buoi faces up to 20 years in prison for each of the four wire fraud counts. He also faces up to 30 years in prison for making false statements to a financial institution.
There has been no shortage of indictments, guilty pleas, prison sentences, and at least one civil settlement related to PPP loan fraud. If recent DOJ press releases are an indication of the government’s focus and willingness to pursue perpetrators of COVID-19 relief fraud, then we can expect to see more indictments, convictions, and prison sentences.
The attorneys at Chilivis Grubman represent clients of all types and sizes in connection with white-collar criminal investigations and health care fraud investigations. If you need assistance with such a matter, please contact us today.