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Lore And Order-- Half A Trill Got Heisted... Who's Going To Prison? Trump?

Trump's Small Business Administration Oversaw The Looting Of The Treasury


The Biden administration was off and running yesterday about spending billions more on funding the police, or, as they put it, fighting crime. I'm a law and order guy and I like the idea of fighting crime, but I'm far more interested in the kind of real crime, the kind rich people and their corporations commit than the kind of petty crime most police forces spend their energy on-- mostly ineffectively (because so many police forces are made up of, at least in part, the dregs of society). But let's do an experiment.


It's beginning to seep out that rich people stole billions-- even hundreds of billions-- of dollars from the COVID relief programs. Will they go to prison? Will all their wealth be confiscated? Or will they walk away with slaps on the wrist-- if even that? Let's follow the cases as they drag their way through a broken justice system that is normally used as a punitive tool against the working class.


NBC News' Ken Dilanian and Laura Strickler reported yesterday that the criminals bought Lamborghinis, Ferraris, Bentleys and Teslas. "Many who participated in what prosecutors are calling the largest fraud in American history-- the theft of hundreds of billions of dollars in taxpayer money intended to help those harmed by the pandemic-- couldn’t resist purchasing luxury automobiles. Also mansions, private jet flights and swanky vacations. They came into their riches by participating in what experts say is the theft of as much as $80 billion-- or about 10 percent-- of the $800 billion handed out in a Covid relief plan known as the Paycheck Protection Program. That’s on top of the $90 billion to $400 billion believed to have been stolen from the $900 billion Covid unemployment relief program-- at least half taken by international fraudsters-- as NBC News reported last year. And another $80 billion potentially pilfered from a separate Covid disaster relief program. The prevalence of Covid relief fraud has been known for some time, but the enormous scope and its disturbing implications are only now becoming clear."


As much as half a trillion dollars were stolen. Being a big supporter of capital punishment I can't understand the establishment narrative already being pushed by NBC: "Most of the losses are considered unrecoverable." Really? You can't confiscate a lamborghini? OK, you might not be able to get back the money that was spent on a private jet charter, but you can evict the criminals from their homes, seize all their assets and show them what it's like to live in a homeless shelter... or a tent. Did someone say that some of these folks bought mansions?


This is how people lose faith in government's ability to do anything well. There should be absolutely no mercy shown, especially for the most politically-connected and the wealthiest of these criminals. Noh Mercy!


Department of Justice Inspector General Michael Horowitz, who oversees Covid relief spending, told "NBC Nightly News" anchor Lester Holt in an exclusive interview that Covid relief programs were structured in ways that made them ripe for plunder.
“The Small Business Administration, in sending that money out, basically said to people, ‘Apply, and sign, and tell us that you're really entitled to the money,’” said Horowitz, who chairs the Pandemic Response Accountability Committee. “And, of course, for fraudsters, that's an invitation…what didn't happen was even minimal checks to make sure that the money was getting to the right people at the right time.”
The criminal methodology varied, depending on the program. The epic swindle of Covid unemployment relief has been carried out by individual criminals or organized crime groups using stolen identities to claim jobless benefits from state workforce agencies disbursing federal funds. Each identity could be worth up to $30,000 in benefits, according to Horowitz.
The looting of the Paycheck Protection Program worked differently-- and could be far more lucrative. That program authorized banks and other financial institutions to make government-backed loans to businesses-- loans that were to be forgiven if the companies spent the money on business expenses. Nearly 10 million of these loans have already been forgiven. Many of these loans-turned-grants were for millions of dollars, public records show.
Gonzalez said he has seen a lot of fraud in Florida, including billions pilfered each year from the federal Medicare program. But never has so much been stolen so quickly, he said.
Experts say millions of borrowers inflated the number of employees or created companies out of whole cloth. For much of 2020, lenders did little to verify the applications, prosecutors and experts say, in part because Congress required the U.S. Small Business Administration (SBA), which ran the program, to issue explicit guidance that in the interest of getting the money out fast, lenders “will be held harmless for borrowers’ failure to comply with program criteria.” The Government Accountability Office warned of fraud risk, but the program continued under that rule.
“The government spent approximately $800 billion and provided 21 million loans to individuals,” said Haywood Talcove, CEO of Lexis Nexis, which works with the government to verify identities.
No one is sure exactly how much was stolen. An academic paper released last year estimated at least $76 billion in potential fraud, and the authors said that was conservative.
The SBA’s Inspector General has identified $78.1 billion in potentially fraudulent Economic Injury Disaster Loans, another Covid relief program for businesses. The Secret Service has its own estimate: $100 billion.
The basic scheme, Talcove said, was “really simple.” People went on state websites and took the names of existing businesses or registered new, fake ones.
“There's absolutely no security on there. There's no validation of any information,” Talcove said. “And voila, you have company ABC with 40 employees and a payroll of $10 million. And you go and apply for a PPP loan. It was a piece of cake.”
In an effort to find more cases, the PRAC is employing data scientists who use artificial intelligence to plow through 150 million records searching for fraud patterns. In one case it found that a phone number for a gas station in Houston was used on 150 loan applications. It sends these leads to federal agents who follow up on foot.
One of the epicenters of the fraud is Miami, where Juan Gonzalez is the U.S. attorney in the Southern District of Florida.
Gonzalez told NBC News that unlike unemployment relief, which went to every person who qualified, lenders had to stop making PPP loans when the money ran out, even though there continued to be demand. The fraud didn’t just harm the taxpayers-- it hurt people who needed the money.
The American public, he said, “should be very angry. This is billions of taxpayer dollars that has been stripped from them. And more angry should be the people who did lose their jobs, who worked for businesses that couldn't apply for this money because it was gone. Those are really the ones who should be the angriest of all.”

It's worth mentioning that Rick Scott, Florida's former governor, and current senator (and head of the NRSC) ran a hospital chain that pilfered more money from Medicare than anyone else in history but most Florida voters saw that not as a disqualification but as a bonus. That's how warped our political system has become-- especially in Florida, where crime in a badge of honor. "Miami resident David Hines, for example, admitted to a fraud scheme that netted him $3.9 million, according to his guilty plea. The 29-year-old, who said in court papers he struggled with addiction, bought a $318,000 Lamborghini Huracán. He also spent thousands on luxury hotels, jewelry, clothing and dating sites, say prosecutors, who seized the car and recovered much of the money. Also in Miami, a man and a woman admitted to a complex scheme in which, among other things, they claimed they were operating farms-- with many employees-- out of small, single-family homes in the middle of the city. 'Once you looked at the paperwork and once you saw what it was, all it took was a drive to the farm to see there was no farm,' Gonzalez said. In another Florida case, prosecutors have charged a man they say used proceeds from a $7.2 million emergency loan to purchase a 12,579-square-foot mansion, a Lincoln Navigator car, a Maserati and a Mercedes-Benz."


A California couple was convicted in June of stealing $18 million, with which they bought three houses, diamonds, gold coins, luxury watches, expensive furniture and other valuables, prosecutors said. Just as they were to be sentenced, they cut off their ankle bracelets and fled, leaving their children behind, according to the FBI.
They were captured in February in Montenegro. The husband was sentenced to 17 years, and the wife got six years in prison.
Their case underscores that most of the defendants have been freed while awaiting trial and sentencing, even though they have been accused of stealing huge sums.
Washington, D.C., resident Elias Eldabbagh, who has no apparent criminal record, was charged last summer with trying to steal $17 million from PPP and another program. According to his LinkedIn, he earned a degree in computer engineering from California State University-Sacramento, and has worked in various technology jobs. Among the property seized by prosecutors was a Tesla Model 3.
He had been released on his own recognizance while awaiting trial, but was recently jailed after prosecutors accused him of a new crime-- attempting to defraud a bank-- while his original case was pending. Court records show he has pleaded not guilty. His lawyer declined to comment.
In the annals of Covid fraud cases, few have matched the alleged brazenness of Danielle Miller, according to federal prosecutors in Boston, where she was charged. The charging documents in her case say she stole identifying information from a Massachusetts state website, then used that information to apply for Covid relief loans.
In 40 minutes, she had $100,000 in taxpayer money, court documents say. She soon booked a private jet from Florida to California, where she spent $5,500 at a luxury hotel in West Hollywood, court papers allege.
On Miller’s Instagram account, which has 34,000 followers, she posted photos from two posh hotel stays paid for with criminal proceeds, prosecutors say. Her bio: “I want that.”
“Miller’s criminal record includes arrests in five different states, many of which were related to larceny and identity-related fraud,” the complaint in the case says.
Miller pleaded not guilty, but court records now say she intends to plead guilty to an unspecified charge.
She participated in a recent profile in New York magazine that portrayed her as a child of wealthy Manhattan parents whose life was derailed by the circulation of a sexually explicit video when she was in eighth grade.
“Honestly, I more so consider myself a con artist than anything,” the magazine quoted her as saying. “You know how they have that saying that you can sell ice to an Eskimo? If there’s something that I want, I’m getting it.”
Hines got six years in prison, and the fraudulent farmers got 18 and 30 months. But Gonzalez and other government officials acknowledge that for every person caught, many, many more have gotten away with it. And while prosecutors have 10 years to go after the fraud, given the enormous scope of the criminality, the Justice Department simply doesn’t have the resources to go after it all.
“I think there's going to be a percentage that we probably will never catch,” he said. “But we're working as hard as we can to catch as many as we can.”
Across the nation, only 178 people have been convicted so far in PPP fraud cases, according to DOJ. Many more prosecutions are coming, but even if the numbers reach 2,000-- or 20,000-- it will only be a small fraction of the fraud.
...Congressional officials say they are now investigating a half dozen lenders and service providers, including Bluevine, which processed loan applications for $4.5 billion and touted that a business could get loan approval in five minutes.
Bluevine said in a statement: that it used “robust compliance” to reduce fraud in accordance with government guidelines and called it “regrettable” that the government’s loan programs were “abused by bad actors…despite our best efforts.”
Talcove, whose company maintains huge databases of public records and sells verification services to governments, says the government and the lenders and banks could and should have prevented such a huge fraud.
When Covid relief was first proposed, he said, he spoke to Larry Kudlow, then a top economic adviser to President Donald Trump.
“And I explained to him that this was going to be the biggest fraud in the history of our country. And then I was told that you can have speed or you can have security. And that they'd rather just get the money out.”
Talcove said he told Kudlow that banks have the ability to rapidly identify their customers.
The idea that there is a tradeoff between speed and security “is a false premise,” Talcove said. “It's not true. If you believed that, then some of our biggest companies in this country that face consumers would be bankrupt, right? It is very easy to stop the type of fraud that we're looking at. In fact, the private sector stopped this a decade ago.
“The problem that happened is the states panicked, as well as the Small Business Administration.”
In a statement, the SBA said it “takes fraud seriously, and, as such, all applicants are required to provide certification of their eligibility upon application. Misrepresentation of eligibility is unlawful, and, when appropriate, these cases are referred to the Office of the Inspector General.”
But one official who works on Covid relief, and who was not authorized to speak publicly, acknowledged that Talcove is correct in his assessment. In the early stages of the loan program, he said, few controls were in place. And it didn’t have to be that way.
“I agree,” he said, “that the notion that you had to sacrifice certainty for speed is categorically false.”

Did anyone not see this kind of blatantly criminality coming straight down the pike, given the proximity of this amount of loose money and Donald J. Trump, his family and the kind of people he has always had around him?

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