The Justice Department announced Tuesday that a Georgia woman who fraudulently obtained more $6 million in Covid Relief money was sentenced to more three years in prison.
This is the latest example where Americans are using the Paycheck Protection Program, part of the $2.2billion Coronavirus Aid, Relief and Economic Security Act, that Congress passed in March 2020.
Hunter VanPelt, from Georgia, pleaded guilty in August to bank fraud after she submitted six loan applications totaling more than $7.9million on behalf of companies she owned or controlled.
Prosecutors allege that Ms. VanPelt – 49, whose legal title was Ellen Corkrum from 2016 – lied about payroll expenses as well as the number of employees she had. They also claimed that she submitted fraudulent tax records and payroll reports, as well as bank statements. Her lawyer could be reached but not immediately.
The Justice Department stated Tuesday that it had recouped $2.1 million of the $6,000,000 Ms. VanPelt received via the program. It also said that $1.6 million had been returned by a bank after it seized the money.
The banks and other lenders were the main beneficiaries of the huge loan program that ran intermittently from April 2020 through May 2021. The federal government waived much the vetting that traditional lenders do for business loans to speed up the lending process.
This program is highly susceptible to fraud. Researchers at the University of Texas at Austin concluded in August that approximately $76 billion of the $800 million in loans may have been misused. They also gave a more conservative estimate of $38 trillion.
Tuesday’s statement from the Justice Department indicated that it had prosecuted over 150 defendants and seized over $75 million in cash, properties, and luxury items derived through fraudulent loans through this program.
Joshua J. Bellamy was sentenced to 37 month imprisonment last month for fraudulently obtaining more than $1.2million through the Paycheck Protection Program. He owned the company.
Prosecutors stated that Mr. Bellamy spent more than $100,00 of the funds to purchase luxury goods from Gucci, Dior, and other brands. In June, he pleaded guilty for conspiracy to commit fraud by wire.
Source: NY Times