DOJ issued a press release regarding its efforts to combat COVID-19 related fraud schemes, specifically those related to PPP loans. Although some allegations of PPP fraud cited are extreme cases (e.g., misappropriating funds to buy cars, jewelry, etc.), DOJ also mentions instances in which PPP loan recipients inflated their payroll expenses to obtain larger loans. PPP loan recipients should ensure that their documentation and support for disbursed funds are in order in light of the regulatory focus in this area.
As of today, the Department of Justice has publicly charged 474 defendants with criminal offenses based on fraud schemes connected to the COVID-19 pandemic. These cases involve attempts to obtain over $569 million from the U.S. government and unsuspecting individuals through fraud and have been brought in 56 federal districts around the country. These cases reflect a degree of reach, coordination, and expertise that is critical for enforcement efforts against COVID-19 related fraud to have a meaningful impact and is also emblematic of the Justice Department’s response to criminal wrongdoing.