Justice Department has charged 57 individuals with trying to steal $175M in coronavirus relief aid

Federal prosecutors since May have charged 57 people with trying to steal more than $175 million in federal aid designed to help small businesses weather the deadly coronavirus crisis, Justice Department officials said Thursday.

Acting Assistant Attorney General Brian Rabbitt said during a press conference the number of fraudulent loans made through the $600 billion Paycheck Protection Program was “significant” and went beyond the filed charges to date, although officials declined to estimate an exact number.

In addition to the 57 cases involving false applications, the Justice Department said they have identified 500 individuals who may have defrauded the program.

Mr. Rabbitt said the efforts to steal more than $175 million resulted in actual losses of $70 million. Of that total, the government has recovered or frozen more than $30 million.

“The money these defendants stole was taxpayer money,” Mr. Rabbitt said. “Every dollar received was a dollar drawn from the American people’s account. Even worse, every dollar they took was a dollar we had set aside to help our fellow Americans weather one of the worst national crises in recent history.”

Mr. Rabbit said defendants used the loans to purchase “splashy, luxury items.” Those items include high-end cars, homes, renovations, diamond jewelry, trips to Las Vegas and even adult entertainment, officials said.

A Houston man last month was approved for a $700,000 PPP loan by allegedly falsely claiming he had both numerous employees and significant payroll expenses. Federal prosecutors say the man, Lee Price III, had no employees and used the money to purchase a Lamborghini and spend thousands at strip clubs.

Mr. Rabbitt said “coordinated criminal rings” had worked together to steal funds from the program by engaging in “systemic, organized conduct to loot the PPP.”

“The involvement of these rings isn’t surprising, but it is particularly troubling to us here at the department, we will be focusing on these types of cases going forward,” he told reporters.

Also Thursday, NFL player Joshua Bellamy was charged with fraudulently obtaining a Paycheck Protection Program loan and spending the money on luxury items, including from Gucci and Dior, and dropping $63,000 at a Florida casino, the Justice Department said.