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Two Charged With Running Alleged $3.3 Million ‘Fraudulent’ COVID Scheme

   DailyWire.com
CHINA - 2020/03/18: In this photo illustration the currency of the United States dollar icon $ icon seen displayed on a smartphone with a computer model of the COVID-19 coronavirus on the background. (
Photo Illustration by Budrul Chukrut/SOPA Images/LightRocket via Getty Images)

Two New Jersey residents who allegedly obtained nearly $3.3 million in coronavirus relief fund payouts and bought properties in Texas are being charged by the U.S. Department of Justice (DOJ) as the government continues to crack down on federal Paycheck Protection Program (PPP) fraud.

Jean E. Rabbitt, 51, allegedly submitted fraudulent PPP applications for four of her businesses, with fraudulent payroll records and tax records. The Internal Revenue Service (IRS), however, told the DOJ that none of the tax records submitted for the funds were ever filed with the agency.

After receiving about $3.3 million, Rabbitt allegedly had Kevin Aguilar, also 51, create “sham payroll companies,” a press release stated. Checks were written from businesses operated by Rabbitt to her other businesses, followed by the two allegedly transferring money to companies created by Aguilar. The then-Monmouth County, New Jersey, residents used the money to buy properties in Sherman, Texas, and “pay for personal expenses.”

Rabbitt is being charged with bank fraud, while the two are being charged with conspiracy to engage in monetary transactions in property derived from specified unlawful activity and engaging in monetary transactions in property derived from specified unlawful activity, according to the DOJ.

“Rabbitt also made false and fraudulent statements and used falsified and fraudulent documents in support of applications for forgiveness of certain of the PPP loans,” the justice department said. “Based on Rabbitt’s false and fraudulent certifications and documents, the SBA paid more than $2 million dollars to lenders in connection with the fraudulent PPP loans Rabbitt obtained.”

Counts of “conspiracy to engage in monetary transactions in property derived from specified unlawful activity and engaging in monetary transactions in property derived from specified unlawful activity carry a maximum sentence of 10 years in prison,” the press release stated. Each count of bank fraud carries a 30-year maximum prison sentence, accompanied by a $1 million fine.

The DOJ has continued to fight COVID relief fraud through its enforcement task force established in May 2021. The program has been rife with fraud, with one report from August 2021 claiming 15% of loans given out were fraudulent. President Joe Biden announced Tuesday evening during his State of the Union address that the DOJ will appoint a chief prosecutor for coronavirus-related fraud.

“We’re gonna go after the criminals who stole billions of relief money meant for small business and millions of Americans,” the president said. The White House said the agents will “use state-of-the-art data analytics tools” to follow identity fraud and schemes in connection with PPP.

The U.S. Secret Service announced in December 2021 it had appointed a senior official, Roy Dotson, to be the National Pandemic Fraud Recovery Coordinator. That same month, the agency also said investigations have led to the seizing of more than $1.2 billion in illegally obtained money and $2.3 billion being returned through Automated Clearing House reversals.

The DOJ declined The Daily Wire’s request for comment.

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