Secret Service ASAIC Roy Dotson is among those chasing down COVID relief fraud
An estimated $100 billion in federal pandemic relief funding was stolen by fraudsters who blew the cash on lavish lifestyles, and now the government is grappling with the daunting task of tracking down and prosecuting the perpetrators.
In total, the US government splashed out some $6 trillion in emergency COVID-19 relief funds to prevent economic disaster, and the firehose of cash attracted a flock of eager fraudsters.
The suspects include a former NFL player and a reality TV star, and in the scores of cases brought so far, prosecutors allege that fraudulently obtained funds were spent on everything from Lamborghinis and Rolex watches to a contract murder.
Now, federal prosecutors, teams of investigators from multiple inspector general offices, and even the Secret Service are pursuing a complex web of investigations to bring the fraudsters to justice.
In December, the Secret Service appointed Assistant Special Agent in Charge Roy Dotson of the Jacksonville field office as the National Pandemic Fraud Recovery Coordinator, tasked with coordinating efforts across multiple ongoing investigations into fraudulent relief claims.
In one of the most infamous cases, David T. Hines, 29, from Miami, obtained $4 million in PPP funds and used the money to buy a $318,000 Lamborghini Huracan
Hines pleaded guilty in February 2021 to one count of wire fraud and was sentenced to more than six years in federal prison. The court also ordered him to forfeit the Lamborghini
‘The Secret Service currently has more than 900 active criminal investigations into fraud specific to pandemic-related relief funds,’ Dotson said in a statement at the time.
‘That’s a combination of pandemic benefits and all the other benefits programs too. Every state has been hit, some harder than others,’ he said.
‘The Secret Service is hitting the ground running, trying to recover everything we can, including funds stolen from both federal and state programs.’
Much of the fraud involved bogus applications for Paycheck Protection Program (PPP) funds intended to keep small businesses afloat, but scams involving unemployment insurance were also rife, investigators say.
The sprawling fraud took place over three separate rounds of relief funding during both the Trump and Biden administrations, and the current White House is quick to paint it as an issue that President Joe Biden ‘inherited’ from his predecessor.
‘There is no question that the immense fraud that took place at the crush of the pandemic in 2020, particularly in small business loans and unemployment insurance, is the largest oversight challenge the Biden administration inherited,’ Gene Sperling, Biden’s chief coordinator for stimulus spending, told the Washington Post.
Sperling stressed that the administration is taking ‘significant steps to strengthen anti-fraud controls.’
However, some of the purloined money may now be difficult or even impossible to recover now.
Last month, the US Government Accountability Office estimated that the Small Business Administration had already fully forgiven some $550 billion in PPP loans, complicating efforts to claw back stolen funds.
The watchdog agency also said that the government had paid lenders $49 billion to forgive PPP loans, despite the fact they were ‘still being reviewed by SBA to address alerts and flags indicative of eligibility concerns.’
Scores of alleged fraud cases have made for shocking headlines over the past two years.
Jasmine Martinez, 33 (pictured) allegedly paid a hitman to kill TSA Officer La’Shonte Jones
TSA agent Jones, 24, was shot dead on May 3, 2021, in front of her daughter
Just earlier this month, a Florida woman was accused of using a $15,000 PPP loan to hire a hitman to murder the 24-year-old woman she claimed stole her boyfriend.
Jasmine Martinez, 33, was charged with first degree murder for allegedly masterminding the plot to kill Le’Shonte Jones.
Jones, a TSA agent at Miami International Airport, was fatally gunned down in front of her three-year-old daughter outside their home at Coral Bay Cove Apartments in the Miami suburb of Homestead, on May 3, 2021.
Police say Martinez took out a $15,000 pandemic relief loan, which she claimed was for her one-woman beauty salon in operation, and then used it to hire Javon Carter, 29, to kill Jones. It is not clear if Martinez ever actually owned a salon.
David T. Hines, 29, was sentenced to six years in prison for PPP fraud
Carter and Romiel Robinson, 35, who reportedly connected Martinez with the assassin, are also charged with murder, but deny their involvement. All three could face the death penalty if found guilty.
In one of the most infamous cases, David T. Hines, 29, from Miami, obtained $4 million in Covid-19 relief funds after applying for PPP loans for small businesses.
Hines used those funds, in part, to purchase a $318,000 Lamborghini Huracan luxury car for himself.
He had claimed that he had hundreds of employees across four companies – Unified Relocation Solutions, Promaster Movers, Cash-in Holdings LLC and We pack Moving LLC – and that he needed $13 million to keep paying them.
In reality, prosecutors say he had 12 employees and that his business ‘inflows and outflows’ were around $200,000 a month.
Hines pleaded guilty in February 2021 to one count of wire fraud and was sentenced to more than six years in federal prison. The court also ordered him to forfeit the Lamborghini.
Former New York Jets wide receiver Joshua Bellamy was charged with fraud and conspiracy for his involvement in a scheme to obtain $1.2 million in PPP funds
Bellamy, 32, pleaded guilty last June to conspiracy to commit wire fraud, and was sentenced to 37 months in federal prison
In another shocking case, former New York Jets wide receiver Joshua Bellamy was charged with fraud and conspiracy for his involvement in a scheme to obtain $1.2 million in PPP funds.
After obtaining the loan for his company, Drip Entertainment LLC, Bellamy admitted to using the funds on personal items, such as jewelry and a stay at the Seminole Hard Rock Hotel and Casino.
Bellamy, 32, pleaded guilty last June to conspiracy to commit wire fraud, and was sentenced to 37 months in federal prison.
As well, reality TV star Maurice Fayne, who starred in Love & Hip Hop: Atlanta, was sentenced to more than 17 years in federal prison for charges stemming from a Ponzi scheme and PPP fraud.
Acting U.S. Attorney Kurt R. Erskine said last year that Fayne ‘planned to use the PPP program as a cover for his long-running Ponzi scheme.’
Reality TV star Maurice Fayne, who starred in Love & Hip Hop: Atlanta, was sentenced to more than 17 years in federal prison for charges stemming from a Ponzi scheme and PPP fraud
Pictured: A 2018 file photo of a vintage gold luxury day date watch. Fayne spent over $1.5million on jewelry, investigators said
In April 2020, Fayne submitted a $3.7 million PPP loan application to United Community Bank, falsely claiming that his trucking business had 107 employees and an average monthly payroll of $1,490,200.
Instead of using the funds to keep his business afloat, Fayne spent the money on a Rolls-Royce lease, custom jewelry, past-due child support, restitution owed in a previous fraud case, and other personal expenses, prosecutors say.
In yet another case, a Michigan couple were busted for filing bogus COVID unemployment claims worth $2.5 million after posting pictures of their designer clothes, cars and jewelry online.
Johnny Richardson, 25, and Micahia Taylor, 27, have both pleaded guilty in the case and are due to be sentenced on April 13. They face up to 20 years in prison.
Images of an unemployed Richardson and Taylor online showed the pair enjoying a luxury lifestyle, buying brand new Mercedes-Benz cars worth $130,000, vacations and jewelry.
Johnny Richardson, 25, and Micahia Taylor, 27, (above) have both pleaded guilty in an fraud case and are due to be sentenced on April 13. They face up to 20 years in prison
Images of an unemployed Richardson, pictured, and Taylor online shows the pair enjoying a luxury lifestyle, buying brand new Mercedes-Benz cars worth $130,000, vacations and jewelry.
U.S. Postal Inspection Service Inspector Erin Leipold said: ‘In general, posts to Richardson’s account routinely depict him wearing designer clothing and custom diamond-encrusted jewelry and watches, driving luxury vehicles, and in possession of large sums of money’
Sharing an image of the car Richardson bought for Taylor in Instagram, he wrote: ‘BABY YOU DESERVE EVERYTHING I GOT THE BIG HOUSE YOU WANTED AND THE CAR AND THE JEWELRY.
‘BTW I LOVE YOU SO MUCH AND I’M NOT DONE NEXT WEEK I GOT SOMETHING BETTER.’
The couple is said to have filed the fraudulent unemployment claims online, either themselves or through others.
They then a friend in the the State of Michigan Unemployment Insurance Agency about the claims; who used her government role to fraudulently release payment, authorities said.
When the friend’s home was raided, police found $238,000 in cash and Louis Vuitton items.
Her cellphone is said to have contained messages from Taylor and communication about Richardson, who officials say is ‘not gainfully employed and has no other known legitimate source of income.’
