Scammers have stolen $70 million from a program supporting US businesses hurt by the coronavirus downturn, leading to charges against dozens of people including an NFL player, the Justice Department said on Thursday.
Brian C. Rabbitt, an acting assistant attorney general for the criminal division, told reporters that 57 people had been charged with attempting — successfully in many cases — to get hold of more than $175 million from the Paycheck Protection Program (PPP).
Only some of that amount was actually taken, however, and the government has recovered about $30 million.
In the latest fraud, the Justice Department later Thursday announced the arrest of Josh Bellamy, a player for the New York Jets professional football team, for allegedly being part of a group of 12 people involved in that scheme to file numerous fraudulent loan applications in what Rabbit said was the single largest PPP scam involving the attempted theft of $24 million.
“The amount of fraud that we’ve uncovered to date and that we’ve prosecuted to date is significant,” Rabbitt said.
“Given what we’ve seen so far, we believe that there is an additional set of fraudulent activity out there that we intend to continue pursuing.”
The PPP was part of the $2.2 trillion CARES Act rescue package Congress passed in March to blunt the economic fallout from the Covid-19 pandemic.
Business shutdowns to stop the spread of the virus have led to tens of millions of layoffs since, although the PPP and other provisions have been credited with spurring some rehiring, keeping businesses afloat and helping sectors of the economy recover more quickly.
Rabbitt said the scams took place across the United States and fell into two categories: those perpetrated by individuals or small groups who create fraudulent businesses, and those done by organized criminal rings.
Other indictments announced on Thursday included seven people in Georgia and South Carolina who were charged with attempting to launder about $750,000 in fraudulently obtained money, more than half of which was from the PPP, as well as two New York brothers arrested for allegedly trying to steal $7 million from the program.
The PPP finished in early August after making more than 5.2 million loans totaling upwards of $525 billion, according to the Small Business Administration.
Controversy arose after the program’s rollout amid claims that large businesses had inappropriately applied for funds, while prosecutors have announced several fraud indictments.
A Taiwanese national charged in August with spending nearly $3 million obtained from the program on a Rolex watch, Mercedes and other luxury items after claiming numerous celebrities, professional athletes and television figures as employees.
Also jailed that month was a Texas man who allegedly made off with $1.6 million and spent it on strip clubs, real estate, a pickup truck and a Lamborghini Urus sports car.
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