Feds say Raleigh businessmen ‘pocketed over $1 million’ in fraudulent COVID relief
Two Raleigh men have pleaded guilty to bilking the federal government out of over $1 million of COVID relief money in separate schemes, the U.S. Department of Justice announced.
Earl Lamont Taylor pleaded guilty Monday to charges of bank and wire fraud tied to his life coaching and basketball scouting businesses, according to a DOJ news release. Working with two other men, Taylor received $291,665.50 in fraudulent Paycheck Protection Program loans, the release said.
Taylor’s recruiting company was in business in 2019 and 2020, but the employees he listed on his loan application made about $2,000 a year, far from the hundreds of thousands of dollars he claimed they received, according to the release. His purported life coaching business appeared to never have been in operation; its associated bank account was only open to receive the loan payment, the release said.
“Lamont Taylor ran a business scouting players who hustled on the court, but ran his own hustle off the court, fraudulently securing over $300,000 in PPP relief funds,” U.S. Attorney Michael Easley Jr. said in the release. “While most of us were trying to help our neighbors navigate a global pandemic, this talent scout and ‘life coach’ was helping himself to relief funds.”
Fabricated tax returns
Similarly, Wilson Alfredo Olivera Borda pleaded guilty last week to multiple charges after receiving nine PPP loans for five companies in 2020 and 2021, according to a DOJ release. He falsely claimed each business had substantial employees and operations and submitted fabricated tax returns supporting his applications.
▪ Two companies, The Insurance Centers.Com and The Insurance Centers LLC, were not separate businesses, but trade names used by a different company for which Olivera Borda had already received COVID relief funding, the release stated.
▪ The other three, Realty Vestors LLC, US-Kaizen LLC, and Ecobuild LLC, had little or no operations and no employees.
After getting the loans, Olivera Borda made additional false claims to obtain forgiveness. Ultimately, all nine loans were fully forgiven and paid off by the U.S. Small Business Administration.
“This businessman pocketed over $1 million in PPP relief funds by submitting bogus tax returns suggesting his business had legitimate operations and employees,” Easley said in the release. “When the FBI dug in, the house of cards came tumbling down.”
Both men face up to 30 years in prison and fines of up to $1 million.
Billions in COVID fraud nationwide
In late March, the Internal Revenue Service announced it had investigated 1,644 tax and money laundering cases related to COVID fraud potentially totaling $8.9 billion, with well over half of the cases opened in the past year.
As of Feb. 29, 795 people have been indicted for alleged COVID-related crimes and 373 people have been sentenced to an average of 2 years and 10 months in prison. During the last four years, Criminal Investigation, the agency that investigates IRS code violations, had a 98.5% conviction rate in prosecuted COVID fraud cases, according to the IRS.
“In the last year alone, we have opened nearly 700 new COVID fraud investigations that collectively add up to $5 billion in potential fraud,” Criminal Investigation Chief Guy Ficco said in an IRS news release.
“While COVID may no longer be top of mind to the average American when they wake up, the fraud committed through these different programs is very much top of mind to CI,” he said. “Our special agents continue to seek out fraudsters who stole money from government loan programs for their personal gain.”
This story was originally published November 26, 2024 at 8:32 AM.