Five current and former officers were charged in a massive COVID-19 emergency fund fraud scheme that eventually included hundreds of people, according to law enforcement.
According to the U.S. Attorney’s Office for the Northern District of Georgia, the five officers used the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan Program to attempt to defraud the federal government out of $6 million.
One officer, former Fulton County, Georgia Sheriff’s Deputy Katrina Lawson was recently found guilty on multiple charges in federal court, including conspiracy to commit wire fraud and money laundering.
According to prosecutors, the former deputy created a conspiracy to submit fraudulent loan applications to the Small Business Administration and eventually netted more than 200 people, including four other current or former members of law enforcement.
The group stole more than $3 million of the total, and used it to spend on a Mercedes-Benz, a motorcycle and liposuction.
The information related to the theft was found during a separate investigation into narcotics trafficking. While searching the home of a suspect, authorities found a notebook and phone that outlined the scheme.
The officers were charged as a result of an investigation into the use of such funds.
The current case is not the only high-profile example of fraudulent use of COVID-19 funds. During the pandemic, the federal government as well as many states opened up emergency funding for a variety of purposes.
One of the most significant programs and one that has been targeted for fraud was PPP. The program was originally intended to prevent layoffs by covering the payroll cost of workers that would otherwise be laid off due to the pandemic.
The fraud was so bad that former U.S. Attorney Matthew Schneider called it the “biggest fraud in a generation.”
Accusations regarding the program included organized crime using stolen identities to claim the COVID relief money. Experts estimate that there may have been up to a half trillion dollars in potential fraud.
Carnegie man sentenced to 6½ years for $3.8 million paycheck protection program fraud. #IRS #PPPfraud @WDPAnews @FBIPittsburgh https://t.co/ldfdhT4taw pic.twitter.com/gU5MV6pFph
— IRS Criminal Investigation (@IRS_CI) April 7, 2023
Some of the applicants who received loan forgiveness used the funds provided by the federal government to buy luxury automobiles and mansions. In one high-profile case, a Washington D.C. man attempted to steal $17 million from PPP and another program.
Law enforcement seized a Tesla Model 3 during the investigation.
In another case, a Florida man allegedly purchased a mansion, Lincoln Navigator, a Maserati and a Mercedes-Benz with his $7.2 million COVID emergency loan.
Another case found a man and woman claiming funds for farms they ran that did not exist.
