COVID-19 Relief Funds Tied to an Increase in Fraud Across US

Since it began, the COVID-19 pandemic has devastated millions of people across the globe. In the United States, unemployment numbers spiked to new heights when they reached 14.8% in April of 2020 during the start of lockdown. The combination of high unemployment rates and the inflated cost of living caused hundreds of thousands of families all over the United States to lose their homes and businesses. These factors led directly toward the government deciding to move forward with relief efforts for nearly every adult in the country.

However, this relief created a variety of unique complications. The alleged misuse of relief funds has been reported more than once across the United States. Details show that some individuals have attempted to use forged documents to obtain small business loans and funds from other organizations or programs, which makes it difficult to obtain for those who truly need assistance. Not all reported instances of relief fund fraud are valid, and false accusations do occur. Working with a skilled attorney can help you easily navigate a fraud accusation case in Central Florida.

Instances of Fraud During the COVID-19 Pandemic

Citizens received two stimulus checks from the government during the course of lockdown in the United States, which was a government-mandated order asking non-essential businesses and employees to remain at home while civilians avoided travel and large gatherings. These checks were distributed to help finance important costs that many families were not able to afford due to their loss of employment.

On multiple occasions during the distribution of stimulus checks, cybercriminals pursued identity theft in the interest of obtaining access to relief funds provided by the government. This became such a significant problem that the FTC (Federal Trade Commission) created a guide detailing the steps that someone would need to take if their relief check was stolen.

Other cases of fraud occurred across the country as hackers impersonated individuals and attempted to claim that they had not received their relief payment or that it had been stolen from them. While identity theft is common in the United States, there was a significant spike in reports of stolen information after the distribution of stimulus checks.

Stimulus Payments Associated with Small Business Fraud

One of the areas most impacted by the COVID-19 pandemic was small businesses. Many unique companies run by small teams were forced to close their doors or reduce their scope due to the lockdown mandate. While a variety of companies began pursuing online ordering, delivery, and other accommodations to ensure that they could remain afloat, this was not possible for every business.

In an effort to combat the rapidly declining customer base that many small businesses were experiencing at the start of the pandemic, the US government created the CARES Act in March of 2020. One aspect of the CARES Act involved the Paycheck Protection Program (PPP) for small businesses, which allowed qualified companies to apply for loans at a lower interest rate for up to two years. If these small businesses were approved for the relief payment, the financial assistance they received was designated for business expenses that included operational costs, payroll, rent, and more.

Many businesses who applied for loans came under fire by the government for suspicious activity associated with their relief funds. Employers were taken to court over applying for PPP loans that were falsified with information that would lead to larger amounts of financial assistance than they required. Other cases of small business relief fraud occurred when owners applied for loans that covered dozens of employees when they, in fact, had none.

More serious cases of business-relief fraud were related to company owners and employers who obtained large sums of stimulus funds that were used to make personal purchases, such as a business owner in Florida who was charged with “bank fraud, making a false statement to a lending institution, and two counts of money laundering.” This business owner received more than $2 million in relief funds and used the financial assistance he received to pay for a personal boat and a variety of other expenses that were not related to his company.

False Accusations of Relief Fund Fraud

Though many small businesses experienced a significant drop in their revenue toward the first quarter of 2020, there is a large portion of companies that grew and evolved during the course of the pandemic. This growth is one of many examples that has led to circumstances of false accusations associated with relief fund fraud.

If you are someone who operates or manages a small business and you have experienced a false accusation of relief fund fraud, it is important to remember that you should not take on your case alone. It is necessary to partner with an experienced legal professional that has knowledge of fraud cases and false claims that are unsubstantiated. When you are facing an issue related to accusations of small business relief fraud, you need to work with an attorney you can trust to ensure your rights are protected every step of the way.

Dedicated Fraud Defense Lawyers in Central Florida

The team at The Umansky Law Firm knows that no two cases of fraud are exactly the same, which is why we never take a one-size-fits-all approach to defending our Central Florida clients. If you are facing an accusation of fraud and you need the help of a reliable defense attorney, look no further than the legal professionals at The Umansky Law Firm in Orlando.

Our skilled attorneys are experienced in all manner of fraud cases, and we have helped thousands of clients in Central Florida obtain the best possible results for their unique situation. To get started on your case today, call us or visit us online to schedule your consultation with one of our qualified defense attorneys.