The case of the Yakima woman amid multiple COVID loan fraud investigations in central Washington | northwest

A federal task force is investigating multiple cases of federal loans to alleviate COVID-19 in the Tri-Cities area based on fraudulent applications, federal prosecutors say.

It reached a $3.2 million settlement with Hanford Nuclear Reservation’s occupational health contractor HPM Corp. in March, but there are other cases of contractors or subcontractors suspected of double-dipping, said Dan Fruchter, deputy U.S. Attorney for East Washington

They appear to have received credit for expenses already covered by taxpayers’ money from the Department of Energy, he said.

In addition, a US Attorney’s Office COVID-19 Fraud Strike Force is investigating other fraud cases in eastern Washington ranging from companies too large to be eligible for the federal small business loans to individuals making business loans received that did not exist, Fruchter told the Tri-City Herald.

“COVID-19 relief programs, which were essential to boosting our economy and supporting our families, quickly ran out of money due to the number of people and companies applying for funding,” said Vanessa Waldref, the U.S. Attorney for the districts.

“It’s not fair that during the COVID-19 pandemic, some deserving small businesses were unable to get funding to keep their businesses running while others abused the program,” she said.

The U.S. Attorney’s Office for the District of Eastern Washington created the operational force this spring to devote resources to investigating and prosecuting COVID-19 fraud.

E. Washington Falls

In its agreement with HPMC Corp. in Hanford, the company agreed to pay nearly $3.2 million in restitution and penalties, including a $250,000 penalty against its owners.

The company received a $1.3 million loan under the Paycheck Protection Program of the Coronavirus Aid, Relief and Economic Security, or CARES Act.

But instead of using the loan for payroll, the entire amount was transferred to the personal accounts of Hollie Mooers, HPMC’s founder and president, and her husband, Grover Cleveland Mooers, according to an investigation by the Department of Energy’s office of inspector general.

That was about three months after the federal government waived loans and interest. About two months later, the full amount of the loan was donated to charities.

This case was prosecuted by the US False Claims Act, which can result in agreements to repay up to three times the loan amount to the federal government and its taxpayers.

Other cases in eastern Washington are being prosecuted as criminal cases.

Karla Padilla, 48, of Yakima, was charged in May with seven counts of fraudulently receiving COVID-19 aid funds.

She is accused of receiving three federal loans totaling about $59,000 for Queen B Collectibles, rumored to be a collector car business, and applying for four other loans, which were denied.

But Queen B Collectibles had no employees, receipts or operations, according to US attorneys.

In another count, Roshon Edward Thomas, 52, of Spokane, pleaded guilty in May to fraudulently receiving more than $50,000 in COVID-19 relief funds for an alleged tattoo parlor and clothing design company.

Few COVID loan controls

The federal loans came at a time of crisis when businesses were closing and employees were left without paychecks.

“There just wasn’t time when the money was being spent to do much, if any, due diligence…” Fruchter said. “And so happened billions of dollars going out the door with no real controls other than trusting people when they promise under penalty of perjury that they have a real business and that the information is true and correct.”

Now the COVID-19 Fraud Strike Force is hunting down the people who lied, he said.

Hundreds of millions of dollars have been disbursed under the CARES Act loan program in eastern Washington, the vast majority of which have not been repaid, according to US Attorneys.

It will be led by Fruchter and Assistant US Attorney Tyler Tornabene — working with an attorney from the Department of Energy’s Office of Inspector General — and support staff with expertise in financial analysis and electronic discovery.

In addition, federal agents from 14 federal agencies ranging from the Federal Bureau of Investigations to the Internal Revenue Service participate as needed.

Part of the goal is to move cases forward quickly, particularly for smaller or front companies with assets that could no longer exist unless U.S. attorneys act quickly to seize them, U.S. prosecutors said.

“We want to restore as much as possible for the public,” Fruchter said.

(c) 2022 Tri-City Herald (Kennewick, Washington)

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