Here is a press release from the IRS Criminal Investigation:
DENVER- IRS Criminal Investigation (IRS-CI) today released investigative statistics on the agency’s COVID-related fraud investigations over the past two years.
The agency investigated 660 tax and money laundering cases related to COVID fraud, with alleged fraud in those cases totaling $1.8 billion. These cases included a wide range criminal activity, including fraudulently obtained loans, credits and payments intended for American workers, families and small businesses.
“The CARES Act (Coronavirus Aid, Relief, and Economic Security Act) was enacted nearly two years ago as a safety net for Americans in the face of an unprecedented health crisis. Unfortunately, even in times of crisis, criminals stick their heads out to look for ways to take advantage of those at their most vulnerable. Through the investigative work of IRS-CI Special Agents and our law enforcement partners, we have ensured that criminals who attempt to defraud CARES Act programs face the consequences of their acts,” said IRS-CI chief Jim Lee.
“The IRS Criminal Investigation’s enforcement efforts have a direct impact on the American public’s confidence in federal tax laws and assistance programs,” said Andy Tsui, Special Agent in Charge of the IRS Field Office. the IRS Criminal Investigation in Denver. “Our special agents are committed to identifying and investigating individuals who attempt to defraud the federal government for their personal gain and to send a clear message to criminals that they will be held accountable for their actions.”
These consequences include a 100% conviction rate for cases prosecuted with prison sentences averaging 42 months.
The IRS Criminal Investigation Denver Field Office conducts investigations throughout Colorado, Wyoming, Montana, and Idaho. Case examples include:
Kasey Wilson was sentenced to a year and a day in federal prison and ordered to pay $125,000 in restitution for orchestrating a scheme to receive Paycheck Protection Program loan payments. Wilson and a co-defendant made false statements on a PPP loan application that their company paid payroll taxes and had 34 employees. The company never paid payroll taxes and had no employees other than Wilson and the co-defendant.
Douglas Wold of Meridian, Idaho was sentenced to federal prison for wire fraud, mail fraud and money laundering based on schemes to defraud his employer. Wold committed fraud in a COVID-19 testing program by issuing a fraudulent invoice to Fry Foods Inc. on behalf of his company, Hala Lallo Health. When Fry Foods paid Hala Lallo Heath for the tests, Wold deposited the money in a bank account he controlled and did not pay the health care provider who actually performed the tests.
The IRS-CI encourages the public to share information regarding known or suspected fraud attempts against any of the programs offered through the CARES Act. For report a suspected crimetaxpayers can visit IRS.gov.
The CARES Act was signed into law on March 27, 2020 to provide emergency financial assistance to millions of Americans suffering from the economic effects of the COVID-19 pandemic. One of the sources of relief provided by the CARES Act was the authorization of up to $349 billion in small business forgivable loans for job retention and certain other expenses, through the PPP. . In April 2020, Congress authorized over $300 billion in additional funding, and in December 2020 another $284 billion.
The Paycheck Protection Program allows eligible small businesses and certain other organizations to receive loans with terms of two to five years and an interest rate of 1%. Businesses must use PPP loan proceeds for payroll costs, mortgage interest, rent and utilities. The PPP allows interest and principal to be waived if businesses spend the proceeds of these expenses within a specified time frame and use at least a certain percentage of the loan for payroll expenses.
To learn more about COVID-19 scams and other financial schemes visit IRS.gov. Official IRS information on COVID-19 and Economic Impact Payments can be found at Coronavirus tax relief pagewhich is frequently updated.