The federal government’s new top prosecutor for serious fraud against the massive pandemic relief program is setting up teams to analyze what he has called “an almost shocking amount of data” that could bring new charges.
The Justice Department named Kevin Chambers, who had been associate deputy attorney general, as chief prosecutor for Covid-19 fraud Thursday. President Joe Biden said in his State of the Union address last week that Chambers would lead the charge against major perpetrators of pandemic fraud.
Chambers said in an interview that his goal is to prosecute those who illegally obtained money from pandemic relief benefits, including the Paycheck Protection Program, and unemployment insurance funds to discourage such behavior and try to get as much money back as possible.
“People bought vacation homes, Bentleys and Rolexes. We may not get all the money back, but that’s not the only value in bringing these cases," he said.
Although many of the programs ended last year, he said prosecutors are a long way from finishing their work, adding that “if folks who have stolen from the program think for a second that our work is done or they’ve gotten away with it, they’ve got another thing coming.”
Chambers said his role is to enhance the work the Justice Department has already done. Federal prosecutors have so far brought more than 1,000 criminal cases related to fraud losses of over $1 billion, he said, and civil cases have been filed against 1,800 people or entities related to over $6 billion in loans.
Last fall, a federal judge sentenced a California man, Richard Ayvazyan, to 17 years in prison for leading a fraud ring that stole $18 million in Covid-19 relief loans intended for small businesses — a scheme the judge called “horrific, calculated and callous.”
FBI agents said that when they raided his home, his wife tossed a bag containing more than $450,000 into the bushes in their back yard. She was sentenced to six years in prison. Both cut off their electronic monitoring bracelets and went on the run, prosecutors said. They were sentenced in absentia.
Just last month, 11 members and associates of a Brooklyn gang were charged with stealing the identities of 800 people to claim more than $4 million in unemployment benefits. Court documents showed pictures of some of them posing while holding piles of cash.
Chambers said he plans to set up strike forces of analysts, agents and prosecutors to sort through huge amounts of data supplied by state unemployment offices. “The data that we are still collecting from the states is the key to so much of the evidence of fraud,” he said.
It’s an enormous task. The Secret Service has estimated that $100 billion was illegally obtained from the Covid relief programs; private experts who have studied the issue say it could be as much as $400 billion.
The U.S. government spent $5 trillion to fight Covid-19, Chambers said, "so the numbers are going to be big."
Chambers is an experienced federal prosecutor. He has also worked for private law firms and as a certified public accountant, a background that he said “might give a little edge in the current job.”
A son of Jamaican immigrants, his father worked at the Jamaican Mission to the U.N. and decided to remain in the U.S. to raise a family. His mother was a registered nurse.
In explaining the importance of prosecuting Covid-19 fraud cases, Chambers rejected the notion that stealing from the government is a victimless crime. “In a very real sense, people were hurt. Because of this fraud, there are people who didn’t get the loans that might have paid for their kids’ tuition for another year," he said.
“This was not an endless amount of money. If a person gets it through fraud, that is money that would have gone to someone who needed it, was entitled to it, but didn’t get it."