A Green County Kentucky woman was sentenced yesterday to 12 months and 1 day in federal prison for submitting nine fraudulent Coronavirus Aid, Relief, and Economic Security (CARES) Act applications.
According to court documents, between April 2020 and July 2020, Mandy Ellen Bauer, 41, of Greensburg, Kentucky filed nine fraudulent applications for various CARES Act financial assistance programs, including Paycheck Protection Program (PPP) loans, Economic Injury Disaster Loans (EIDL), and advance payment of tax credits, resulting in an attempted theft of over $230,000. In those false applications Bauer exaggerated the gross revenues, number of employees, and payroll of her company, Family Personal Sales. All of Bauer’s fraudulent applications were rejected and she did not receive any funds.
PPP loans were designed to provide a direct incentive for small businesses to keep their workers on the payroll. Under this program, the Small Business Administration (SBA) would forgive all or part of loans if all employees were kept on the payroll for eight weeks and borrowers submitted documentation confirming that the loan proceeds were used for payroll, rent, mortgage interest, or utilities.
EIDLs provided loan assistance (including $10,000 advances) for small businesses and other eligible entities for loans up to $2 million. The EIDL proceeds could be used to pay fixed debts, payroll, accounts payable, and other bills that could have been paid had the disaster not occurred.
“I commend the investigative work of the Treasury Inspector General for Tax Administration,” said Michael A. Bennett, United States Attorney for the Western District of Kentucky. “Together with our federal law enforcement partners we will continue to identify, apprehend, and prosecute fraudsters involved in plots to steal federal relief funds.”
“The Treasury Inspector General for Tax Administration aggressively pursues those who endeavor to defraud programs afforded to the American people under the CARES Act,” said J. Russell George, the Treasury Inspector General for Tax Administration (TIGTA). “We appreciate the efforts of the Department of Justice in this effort.”
The Treasury Inspector General for Tax Administration investigated the case, which was prosecuted by Assistant U.S. Attorney David Weiser.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.