In mid-May, U.S. Attorney General Merrick Garland established the COVID-19 Fraud Enforcement Task Force. Attorney General Garland directed the task force to use the resources of the U.S. Department of Justice in partnership with agencies across government to enhance enforcement efforts against fraud related to the COVID-19 pandemic. Even by that time—more than one year into the pandemic—federal prosecutors, including those in the U.S. Attorneys Offices throughout New York and across the country, had been quite active in fighting COVID-19 fraud. The Justice Department had publicly charged close to 500 defendants with criminal offenses based on fraud schemes connected to the pandemic involving attempts to obtain over $569 million from the U.S. government and others.

Criminal prosecutions have continued at a seemingly accelerating pace—including throughout New York. For example, just weeks ago, the U.S. Attorney for the Southern District of New York charged four individuals with conspiracy to commit wire fraud, wire fraud, false statements, and aggravated identity theft in connection with an alleged scheme to defraud the U.S. Small Business Administration (SBA).

Prosecutors alleged that the defendants used the identities of more than 1,000 individuals to submit over 1,000 online applications to the SBA seeking over $10 million of funds through the SBA's Economic Injury Disaster Loan (EIDL) Program, which Congress expanded in response to the COVID-19 pandemic. The government asserted that, in connection with the EIDL applications, the defendants falsely represented to the SBA, among other things, that the applicants were the owners of businesses with 10 or more employees, leading the SBA to advance payments of more than $7.6 million to the applicants. See U.S. v. Carter, 21 MJ 09734, Sealed Complaint (S.D.N.Y.).