LOS ANGELES – Three years after the enactment of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, IRS Criminal Investigation (IRS-CI) has investigated 975 tax and money laundering cases
related to COVID fraud with alleged fraud in these cases totaling $3.2 billion. These cases include a broad range of criminal activity, including fraudulently obtained loans, credits and payments meant for American workers, families, and small businesses.
Of those cases, 458 individuals have been indicted for their alleged COVID-related crimes, and 236 individuals have been sentenced to an average of 37 months in federal prison. Throughout the three years, CI has a nearly 100% conviction rate in prosecuted cases.
“Today we want to take the time to recognize the anniversary of the CARES act. COVID changed our lives forever, putting strain on families, individuals, businesses and the entire economy. The CARES act was passed to aid those in need and help everyone get through the pandemic and to the other side,”
said Tyler Hatcher Special Agent in Charge of IRS Criminal Investigation’s Los Angeles Field Office. “As programs and benefits were rolled out under the CARES act, criminals rolled in to steal money and take
advantage during this unprecedented time. The Los Angles Field Office is committed to using our expertise to track down, investigate and bring those criminals to justice.
Below are just a few of the many investigations worked by our field office. These sentencings should serve as a warning to the
criminals, we won’t stand by while you steal and use emergency funds for unlawful purposes, you will face the consequences which include significant jail time.”
Case examples include:
- Rapper who boasted in music video about committing COVID fraud sentenced to over 6 years in prison on fraud, gun and drug crimes
Fontrell Antonio Baines, a.k.a. “Nuke Bizzle,” was sentenced to 77 months in federal prison and ordered to pay restitution in the amount of $704,760 to the California Employment Development Department (EDD). Baines bragged about defrauding the EDD in a music video posted to YouTube and in postings to his Instagram account. From July 2020 to September 2020,
Baines exploited the Pandemic Unemployment Assistance (PUA) provisions of the CARES Act to obtain unemployment insurance money. Baines filed 92 fraudulent PUA claims with EDD,
resulting in attempted losses to EDD and the United States Treasury of approximately $1,256,108 and actual losses of at least $704,760. - Co-Conspirators sentenced to 46 months and 36 months for role in COVID unemployment fraud ring
On or before 2020, and continuing through December 2, 2020, co-conspirators of Arman Aghasinyan and Arayik Avetisyan, used stolen identities to apply for unemployment benefits. - Then pandemic-enhanced unemployment funds were loaded to debit cards issued by Bank of America. Aghasinyan and Avetisyan received the debit cards from their co-conspirators and traveled to different ATMs to withdrawal the funds. Through this conspiracy, defendant Aghasinyan defrauded Bank of America out of at least $2,902,000 and Avetisyan defrauded
- Bank of America out of at least $1,464,167. On June 6, 2022, Arnab Aghasinyan was sentenced
- to 46 months in federal prison and ordered to pay restitution in the amount of $2,902,000. On
- October 17, 2022, Arayik Avetisyan was sentenced to 36 months in federal prison and ordered to pay restitution in the amount of $1,464,167.
- Irvine man sentenced to 41⁄2 years in federal prison for fraudulently obtaining $5 million in COVID loans he spent on sports cars
Mustafa Qadiri, of Irvine, California, was sentenced to 54 months in federal prison in February 2023 for fraudulently obtaining $5 million in COVID-relief loans for his sham businesses, which he used to buy Ferrari, Bentley and Lamborghini cars. He was also fined $20,000 and ordered to
pay $2.86 million in restitution. Qadiri claimed to have operated four Newport Beach-based companies, none of which were in operation and submitted false and fraudulent Paycheck Protection Program (PPP) loan applications to three banks on behalf of those companies. Qadiri falsified the number of employees to whom the companies paid wages, altered bank account records to include inflated balances, and provided fictitious quarterly federal tax return forms.
Qadiri also used someone else’s name, Social Security number and signature to fraudulently apply for one of the loans.
