Cares Act Fraud

Enacted on March 29, 2020, the CARES Act provided up to $349 billion in forgivable loans to small businesses through the Paycheck Protection Program (PPP). On April 21, 2020, Congress authorized an additional $310 billion through the same program. Unfortunately, where there is money (in this case government assistance), there is the opportunity for bad actors to commit fraud. Several individuals in New England and Texas have already been charged with fraudulently seeking aid by claiming fake employees in their loan applications. In some cases, the sought-after aid exceeded the $10 million limit to the relief loans guaranteed by the Small Business Administration (SBA). Authorities also arrested a Beverly Hills film producer who had allegedly used PPP funds to pay his personal credit cards. Even more egregiously, the companies for which the producer had sought loans had no actual ongoing operations!

These charges illustrate how important it is for lenders to remain scrupulous in their lending practices to ensure that financial assistance makes its way to intended recipients, in this case small businesses in need, rather than to opportunists seeking ill-gotten gains in times of national distress.

For more information on how the pandemic has brought will out the fraudsters, click on the links below.

Texas man charged with allegedly seeking $5 million in SBA coronavirus loans
Yates allegedly claimed to have 400 employees and used a random name generator on the internet to come up with a list of purported employees.

Read in CNBC: https://apple.news/A7sHaoL8nR9ePn-0imTZi8g

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The Fyre Festival Fraud: Turning Posh Cabanas and Delectable Sushi Menus into Disaster Tents and Cheese Sanwiches

The Fyre Festival fiasco was co-founded by Billy McFarland (a charismatic entrepreneur) and Ja Rule (a once chart-topping rapper).  The unlikely duo saturated the social media market with over-the-top glamorous videos and photoshoots promising to put on a once in a lifetime music festival (courtesy of an island once owned by Pablo Escobar).  The end result? The defrauding of numerous investors, an entire Bahamian community, and thousands of hopeful festival goers.

The Fyre Festival “fraud” exposes just how far consumers and investors will go to portray an alluring lifestyle similar to that of “social media influencers”. In today’s digital world, where social media status reigns supreme, consumers and investors need to be extremely vigilant when relying on celebrity endorsements to direct the spending of their hard-earned money. For more information about one of the biggest social media frauds in history, click on the link below.

Read the full story

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Hamburgled! Go Directly to Jail. Do Not Pass Go, Do Not Collect $200.

Cash skimming…check kiting…embezzlement! These are terms most often associated with allegations of fraud. But white collar criminals are only limited by their creativity, and innovative fraud schemes are cooked up every day. Indeed, from the late eighties through the early aughts, a trusted individual in a fiduciary position (a recurring theme) perpetrated a multi-million dollar fraud scheme using winning McDonald’s Monopoly pieces. For more information about this story, which is likely one of the most interesting fraud cases you’ve never heard, click on the link below.”

Read the full story

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How Business Titans, Pop Stars and Royals Hide Their Wealth

Imagine if your biggest struggle in the morning was deciding which mansion to call home tomorrow or which celebrity couple to let borrow your yacht. These are the daily conflicts faced by the ultra-well-heeled individuals who constitute one percent of the world’s population but own more than half of global wealth. Their substantial but often opaquely quantifiable fortunes, gained through means legitimate, illegitimate, and everything in-between, are often nested within trusts and charities constructed by accountants and lawyers skilled at hiding money. Similar to the revelations made last year upon the release of the so-called Panama Papers, the recent disclosure of documents obtained by a German newspaper relating to Appleby, one of the world’s top offshore law firms, shines an illuminating light on the fiscal orchestrations of more than 31,000 Appleby clients. Click the link below for the juicy details…

https://www.nytimes.com/2017/11/07/world/offshore-tax-havens.htm

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Judge pleads guilty in massive Social Security fraud case

Bribery, dishonesty, greed…what caused a judge to become involved in one of the biggest Social Security frauds in history? Disability fraud appears to be a growing trend. Indeed, Social Security officials testified that they are unable to reach a ballpark estimate for how much fraud actually exists in the disability program. Regrettably, even judges fall into or orchestrate schemes against programs that help those in need, including programs that assist the disabled. For more information about one of the biggest Social Security frauds in history, click on the link below.

http://www.washingtontimes.com/news/2017/may/14/david-b-daugherty-pleads-guilty-in-massive-social-/

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How (NOT) to Hide $400 Million

“Suspicious-minded folk (sound familiar?) may find it highly coincidental that a couple’s net worth often seems to diminish (or disappear) in proximity to a filing for divorce. In our experience, such alleged diminishment can be facilitated through the use of shell companies, offshore accounts, and other legal but often nefariously-used financial vehicles. For an extreme, but actual, example of how a wealthy businessman used shell companies and offshore accounts in his attempts to hide $400 million during his divorce, click on the link below.” 

http://www.nytimes.com/2016/11/30/magazine/how-to-hide-400-million.html?mwrsm=Email

 

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The Trusted Grown-Ups Who Steal Millions From Youth Sports

It is Anthem’s experience that fraud doesn’t limit itself to any one type of industry, organization, or individual. Unfortunately, there are individuals who will embezzle from anyone, even if that “anyone” is children. Investigators and prosecutors in several states say embezzlement investigations involving youth sports have become common, almost always committed by unpaid board members who are highly regarded in their communities. For more information about this story, click on the link below.

READ THE FULL STORY: Prosecutors in several states say embezzlement investigations involving youth sports have become common.

 

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