A Seattle couple have been charged with committing more than $ 1 million in fraud on Covid-19 relief programs.
Brian Sparks, 40, and Autumn Luna, 22, are indicted in a 16-count indictment of defrauding the Washington State Job Security Division (ESD) of over $ 500,000 in benefits and defrauding the Small Business Administration (SBA) of approximately $ 520,000.
In addition to fraudulently claiming unemployment benefits with fake bank accounts, the couple used stolen identities to apply for loans, including the CARES (Coronavirus Aid, Relief, and Economic Security) law.
The SBA paid the couple approximately $ 520,000 in proceeds from the Economic Disaster Loan (EIDL).
Seattle couple indicted on COVID business loan fraud charges
The Small Business Administration is committed to keeping small businesses afloat throughout the pandemic, with a range of financial aid plans. The Payment Protection Program (PPP) and Economic Disaster Lending (EDIL) have proven to be critical in protecting small businesses and jobs. Despite the businesses and jobs they saved, that support has been tarnished by âunprecedentedâ fraud.
“Unprecedented” fraud at the SBA
As Mike Ware, Inspector General of the SBA, told ABC News, âThe scale of the fraud we are witnessing is unprecedented – unprecedented.
âIn terms of dollar value, the amount of fraud in these COVID relief programs is going to be greater than any government program that came before it,â Ware said.
The Washington fraud case highlights the importance of honesty and transparency when applying for SBA funding.
Small businesses that knowingly make a false statement or misinformation in order to be the beneficiary of an SBA loan can face a hefty fine, not to mention significant damage to the reputation of the business.
COVID-19 Fraud Control Task
To strengthen efforts to combat and prevent pandemic fraud, in May 2021, the Attorney General created a COVID-19 Fraud Enforcement Task to mobilize resources from the Ministry of Justice in partnership with government agencies.
The task force is strengthening efforts to investigate and prosecute fraudsters and help agencies administering relief programs to prevent fraud.
The subject of fraud and SMA loans is a reminder of the importance for small businesses of not only being completely honest when applying for a loan, but also being diligent and careful to avoid making mistakes on the applications.
According to Rob Scott, Great Lakes Regional Administrator for the SBA, small businesses should do their homework and be prepared by gathering all documents and updating them when applying for an SBA loan.
âAny delay a business owner takes in getting their information to their lender so they can turn around and put it in the SBA system is a delay you don’t want,â Scott said.