Reported by Kelly Phillips Erb

IRS-Criminal Investigation (CI) has investigated 1,644 COVID-related tax and money laundering cases potentially totaling $8.9 billion, with well over half that amount coming from cases opened in the last year.

Fraud

As of February 29, 2024, 795 people have been indicted for their alleged COVID-related crimes, and 373 individuals have been sentenced to an average of 34 months in federal prison. During the last four years, CI has obtained a 98.5% conviction rate in prosecuting those fraud cases.

“The work by IRS Criminal Investigation provides a vital role in protecting against fraud and serves a key part in the agency’s wider efforts to ensure fairness in the nation’s tax system,” said IRS Commissioner Danny Werfel. “Protecting taxpayers against fraud in pandemic-era programs is just one example of the important role that CI plays in the law enforcement community. A healthy budget for the IRS helps us get the job done, and the work of CI provides a critical safety net to protect the nation against fraud.”

CI expects that work to continue, thanks to additional funding the IRS received through the Inflation Reduction Act.

“In the last year alone, we have opened nearly 700 new COVID fraud investigations that collectively add up to $5 billion in potential fraud,” said CI Chief Guy Ficco. “While COVID may no longer be top of mind to the average American when they wake up, the fraud committed through these different programs is very much top of mind to CI. Our special agents continue to seek out fraudsters who stole money from government loan programs for their personal gain.”

Recent Cases

Two recent cases resulted in years-long prison sentences for the accused.

In March of 2024, Rami Saab, also known as Rami Hasan, was sentenced by U.S. District Judge Gary R. Brown to 10 years in prison for his role as the mastermind of a conspiracy to fraudulently obtain COVID-related relief loans. Saab must also pay restitution worth approximately $9.6 million.

According to court documents, between May 2020 and May 2021, Saab and a network of co-conspirators fraudulently applied for more than $32 million in PPP and EIDL loans on behalf of shell corporations they controlled. As a result, the SBA and private banks granted at least 20 of those applications, resulting in the disbursement to Saab and his co-conspirators of more than $9.6 million in funds they were not entitled to receive. Then, Saab and his co-conspirators laundered the fraud proceeds, withdrawing large portions in cash and transferring sums to associates overseas in Turkey and elsewhere.

Read full report: https://www.forbes.com/sites/kellyphillipserb/2024/03/28/irs-criminal-investigation-says-covid-related-fraud-totaled-nearly-9-billion/?sh=2b130c6bf74f