WEST PALM BEACH—The Palm Beach County State Attorney’s Office and the Palm Beach County Sheriff’s Office have joined forces to help federal investigators catch and prosecute people suspected of making false claims for federal loans meant to help businesses survive the COVID-19 pandemic.
State Attorney Dave Aronberg said Wednesday that the new task force will be made up of four investigators from the agency’s Sober Homes Task Force and two investigators whose job is to look into fraud in the Paycheck Protection Program.
The federal government is looking into a dozen local cases that will be turned over to local authorities and tried in state courts.
At a news conference, Aronberg said, “We don’t know how many cases there will be, but we will go where the evidence leads us.” He was talking about a federal program that was full of fraud.
“We think there will be a lot of cases in a short amount of time. Money was easy to get and had to be spent quickly, so it was a good time to commit fraud. The people who did it thought they could get away with it, but they were wrong.”
In White-collar Fraud Cases, Investigators Say, “We Follow the Money.”
In March 2020, Congress passed the $2.2 trillion CARES Act, which stands for Coronavirus Aid, Relief, and Economic Security. The goal of the economic stimulus bill was to help businesses that were losing money because of the COVID-19 pandemic.
Part of the bill set up the Paycheck Protection Program, which is backed by the Small Business Administration and gives small businesses money to cover up to eight weeks of payroll costs, including benefits. In May 2021, the program was over.
In the past few months, the U.S. Attorney’s Office for South Florida has charged dozens of people with stealing more than $150 million from COVID-19 loan programs. A local FBI task force got help from an investigator from the Palm Beach County State Attorney’s Office.
“Then it was clear that the fraud was so widespread that they needed more help,” Aronberg said on Wednesday. “Because of this, we set up our own task force with PBSO.”
Ted Padich, who is in charge of investigating crimes for the Sober Homes Task Force, said that his group and the Paycheck Protection Task Force work on the same type of white-collar crime.
In 2016, the Sober Homes Task Force was put together as part of a county-wide effort to stop drug treatment centers and health care providers from being dishonest. It is against the law for a health care provider or a lab to offer or give any kind of payment to a drug treatment center or a sober home in exchange for sending patients to them.
Some providers have found that people with private health insurance are especially helpful. Court records show that they ordered multiple urine tests for these patients every week and then sent their insurance companies bills for thousands of dollars. The providers then gave some of the money they got back to the person who made the referral.
Padich said, “When we look into something, we always look through a lot of bank records.” “We look at insurance records, medical records, and bank records. Like in any white-collar fraud case, we follow the money.”
Task Force Won’t Go After Businesses That Failed Despite PPP Loans
The Paycheck Protection Program task force made its first arrest this month, charging a 33-year-old man from Boynton Beach with getting more than $440,000 from the Paycheck Protection Program and other government programs made possible by the CARES Act.
An arrest affidavit says that Brandon Howard Sr. put false information on his loan applications, such as the number of employees at his company and the amount of its monthly payroll.
Authorities say Howard filled out paperwork for a limited liability company with his name on it, saying that the company had 35 workers and paid out $1.9 million in wages in 2019.
Howard has said that he is not guilty of two counts of setting up a scheme to steal money and one count of laundering money. The next time he will go to court is in April. A lawyer for Howard who was listed in court papers could not be reached right away.
Aronberg said, “It’s a good example of how a lot of these cases will look.” “The (Paycheck Protection Program) gives out a big loan, supposedly to keep the business open and pay the workers, but we find out that there are no workers and, in many cases, there is no business at all.”
Chief Assistant State Attorney Al Johnson said that the new task force will also look into fraud reports from the county’s Inspector General’s Office. Inspector General John Carey found seven cases of CARES Act fraud totaling $131,478 in his fiscal 2022 report. One of these cases involved a tenant who allegedly forged documents to get money for rent assistance.
Aronberg said that the county loans and grants are different from the money that the Small Business Administration gives out of the Paycheck Protection Fund. He said that the task force won’t go after businesses that couldn’t pay back federal loans because they were having money problems.
Aronberg said, “That’s not what this is about.” “This is about cheating on purpose. People did this to try to trick the government and steal money from taxpayers by saying they had a business that didn’t exist or that it was for something that didn’t happen. That’s blatant fraud.”
