Unemployment Fraud in CA May Top $2 Billion

Weekly Newsletter | December 11, 2020 | Subscribe

COVID-19 Related Fraud

----------------------------------------------------------------------------------- Los Angeles Times: California unemployment fraud amid COVID-19 pandemic may total $2 billion, Bank of America says Bank of America estimated that fraud in California’s unemployment benefits system could total $2 billion. Since COVID triggered a wave of unemployment since March, this amount represents the highest estimate of fraud yet in the system.

WCNC: 15 North and South Carolina businesses received maximum $10 million PPP loans Newly released federal records show that nearly a third of the Paycheck Protection Program money awarded in the Carolinas went to only 1% of the recipients, including several larger businesses that received the maximum $10 million.

National Law Review: Cheesecake Factory’s SEC Fines Are Latest D&O Liability to Stem from COVID-19 Pandemic The Cheesecake Factory agreed to pay $125,000 to resolve allegations that the company made misleading statements to investors about the impact of the COVID-19 pandemic on its business.

KATV: Former Walmart executive sentenced for COVID-19 relief fraud A former Walmart executive allegedly sought $8 million in Paycheck Protection Program loans and has been sentenced to two years in prison and five years of supervised release. He allegedly gave lenders fake payroll documentation and admitted to lying to a bank about the date that a limited liability partnership was established.

WCIA: Two men indicted on separate fraud charges related to COVID-19 Disaster Loan program Two Illinois men were indicted in separate fraud cases centered on the disaster loan program for COVID-19. One man received approximately $160,000 in loans for a business that does not exist while the other received $26,000 and $72,500 and then wired one loan to a bank in the Dominican Republic.

Dept. of Justice: San Fernando Valley Man Admits to Fraudulently Obtaining $655,000 in COVID-19 Relief PPP Loans A San Fernando Valley man allegedly obtained $655,000 in Payment Protection Program loans for his companies by submitting fake tax documents and false employee information. According to his plea statement, he knowingly submitted PPP loans that contained false statements about the number of employees and the amount of employee payroll expenses.

Case Settlements & Opinions


Dept. of Justice: Attorney General James Secures $4.7 Million After Supermarket Chain Engaged in Three Schemes to Evade Taxes Food World agreed to pay $4.7 million to resolve allegations that it allegedly engaged in three schemes to evade paying taxes. These schemes allegedly included recording cash sales of non-lottery items, generating fake return receipts, and paying employees in cash to avoid withholding taxes.

Dept. of Justice: Jewelry Importer to Pay $400,000 to Resolve False Claims Act Allegations Concerning Unpaid Customs Duties on Chinese Earrings TSI Accessories Group, Inc. (TSI) will pay $402,637 to resolve allegations it violated the False Claims Act by failing to pay customs duties on sterling silver earring imports from China. The government contends TSI improperly concealed the number and value of these imports, increasing the declared value of the imports and allowing the company to pay a lower duty than it should have.

Dept. of Justice: Chiropractor and Related Practice to Pay $175,000 As A Part of False Claims Act Liability Settlement Agreement A chiropractor and his practice, Life Health Medical Center, agreed to pay $175,000 resolve liability under the False Claims Act for allegations that he improperly billed Medicare for the use of electroacupuncture devices.

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