U.S. Department of Labor OIG, South Florida U.S. Attorney’s Office Charges an Attorney, Former SBA Employee, Tax Preparer, and others with COVID-19 Fraud Schemes (USAO SD-FL 09/30/2024) (2024-10-02)

Summary

A press release from the U.S. Attorney's Office for the Southern District of Florida, dated September 30, 2024, stating that over the summer the district charged 17 individuals with COVID-19 relief fraud, with scheme amounts totaling over $21 million, and that more than 185 people have been charged there since the pandemic. The cases listed include former SBA employee Malaina Chapman, indicted in July 2024 over alleged PPP and EIDL schemes, and unemployment insurance cases tied to California claims. Nabil Nahlah is charged with fraud against the United States over sales of PPE to the Department of Veterans Affairs. Loan preparers Pete Andrew Cohen and Marc Prince each pled guilty over approximately $3 million in fraudulent PPP applications, and Madelein Olivia was indicted for stealing a $7 million Employee Retention Credit check.

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“U.S. Department of Labor OIG, South Florida U.S. Attorney’s Office Charges an Attorney, Former SBA Employee, Tax Preparer, and others with COVID-19 Fraud Schemes (USAO SD-FL 09/30/2024) (2024-10-02).” Original at www.oig.dol.gov. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/u-s-department-of-labor-oig-south-florida-u-s-attorney-s-office-charge-b5e7bd8b2e/, SHA-256 415597d7f7e2444c32b75214b5110d036b7b56ed6a43ee4fb66873e563cb606a.

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United States Attorney’s Office
Southern District of Florida

FOR IMMEDIATE RELEASE Monday, September 30, 2024

South Florida U.S. Attorney’s Office Charges an Attorney,
Former SBA Employee, Tax Preparer, and others with
COVID-19 Fraud Schemes

MIAMI – The U.S. Attorney’s Office for the Southern District of Florida remains a
leader in COVID-19 pandemic relief prosecutions, holding a range of actors
accountable for these crimes. Over this summer alone, the district has charged 17
individuals with COVID-19 relief fraud cases, with scheme amounts totaling over
$21 million.

In 2021, the Attorney General established the COVID-19 Fraud Enforcement Task
Force to enhance efforts to combat and prevent pandemic-related fraud. In 2022,
the Southern District of Florida’s U.S. Attorney’s Office was selected to head one of
three national COVID-19 Fraud Strike Force Teams. Together, with federal, state
and local law enforcement partners, the U.S. Attorney’s Office targets fraudsters
that took advantage of programs that offered assistance during the
pandemic. Since the pandemic, more than 185 people have been charged in the
Southern District of Florida for schemes involving more than around $220 million.

“These defendants have in common a willingness to exploit federal programs
created to help people in a global pandemic for their own gain,” stated U.S. Attorney
Markenzy Lapointe for the Southern District of Florida. “The U.S. Attorney’s Office
and our law enforcement partners will continue to uncover COVID-19 related
financial fraud schemes and hold people accountable – regardless of their role in
the community. We will not allow limited federal tax dollars, which were intended
to provide a lifeline to small businesses as they struggled to stay afloat during the
economically devastating pandemic lockdown, to be stolen to support criminal
actors.”
“The Department of Justice remains committed to the prosecution of those who
engaged in COVID-19 benefits program fraud and the return of recovered funds to
the American taxpayers. I appreciate the dedication of the prosecutors and
investigators who brought these people to justice and worked to protect the
integrity of our federal benefits programs,” said Mandy Riedel, Director of COVID-
19 Fraud Enforcement.

The following cases were charged this summer.

Cases Against Federal Employees

A number of federal employees and former federal employees have been charged
with COVID loan schemes, including:

• U.S. v. Malaina Chapman, Case No. 24-CR-20321: Chapman, 37, of
Hialeah, Fla., a former SBA employee, was indicted in July 2024. The
indictment alleges that, while employed by the SBA, Chapman became
involved in multiple schemes to defraud the Paycheck Protection Program
(PPP) and Economic Injury Disaster Loan (EIDL) program, as well as to
defraud local credit unions and local and state programs designed to assist
those affected by the Covid-19 pandemic pay their rent. United States Postal
Service Office of Inspector General (USPS OIG) and the U.S. Small Business
Administration Office of Inspector General (SBA OIG) investigated this
case. This case is being handled by Assistant U.S. Attorney Daniel Bernstein.

“Fraudulent exploitation of SBA's pandemic relief programs diverts critical
resources from the small businesses that truly need them,” said Amaleka McCall-
Brathwaite, Special Agent in Charge of the SBA OIG’s Eastern Region. “Our office
is committed to protecting taxpayer funds and ensuring that individuals who
attempt to defraud SBA programs are brought to justice. I want to thank the U.S.
Attorney’s office and our law enforcement partners for their collaboration and
dedication to justice.”

Unemployment Insurance Fraud

A number of defendants in Florida were charged with defrauding the California
Employment Development Department of millions of dollars by making false
claims for unemployment with the personally identifiable information of the
victims of identity theft. These cases were investigated by the Federal Bureau of
Investigation (FBI), U.S. Department of Labor Office of Inspector General (DOL
OIG), SBA OIG, and Homeland Security Investigations (HSI).
This includes:

• U.S. v. Harold Eubanks and Myotha Francois, Case No. 24-CR-20335:
handled by Assistant U.S. Attorney Roger Cruz.
• U.S. v. Kenneth Dikari Stevens, Jr. and Giovanni Kymani Paul
Matthews, Case No. 24-CR-20293: handled by Assistant U.S. Attorneys
Sean Cronin and Aimee Jimenez.
• U.S. v. Zachary Ramyard, Case No. 24-CR-20382: handled by
Assistant U.S. Attorney Joesph Egozi.

“These cases represent the continued commitment of the FBI and many other
federal agencies to identify and hold accountable those who engaged in COVID
relief fraud,” said Jeffrey B. Veltri, Special Agent in Charge of the FBI’s Miami Field
Office. “The intent of these programs was to provide a financial safety net to eligible
businesses during a time of economic duress – not as a way for criminals to fund
their lifestyles. While the relief programs have ended, our pursuit of the fraudsters
has not. The amount of fraud we’ve seen is staggering. We continue to work hard
every day to investigate these fraud schemes and protect the public from being
swindled.”

COVID-19 Procurement Fraud

This office continues to investigate and pursue individuals who capitalized on the
pandemic by illegally profiting on personal protective equipment (PPE), including:

• U.S. v. Nabil Nahlah, Case No. 24-CR-20434: Nahlah, 49, of Miami
Beach, Fla., was charged with one count of fraud against the United States,
arising from his efforts to sell millions of dollars of PPE to the Department
of Veterans Affairs (VA) during the COVID-19 pandemic. According to
allegations contained in the charging documents filed Sept. 25, Nahlah,
through his company The Noble Attorney, made bids on various
procurement requests from the VA for items like medical masks and
examination gloves. Nahlah won the contracts by making false and
fraudulent representations to the VA, namely by claiming that his firm was
an authorized distributor or reseller of the PPE manufacturers and that he
had the qualifying PPE in stock and available for immediate delivery. Nahlah
furthered the scheme to defraud the VA by creating a fake web domain and
email address for a PPE manufacturer and using it to submit a phony
authorized distributor letter to the VA. Once awarded the lucrative
contracts, Nahlah shipped non-conforming PPE to the VA, including
counterfeit medical masks. This case was investigated by the VA Office of
Inspector General’s (VA OIG) and the FDA Office of Criminal
Investigations. This case is being prosecuted by Assistant U.S. Attorney Jon
Juenger.
• U.S. v. Rodrigo Mera, Case No. 24-CR-20148: In August 2024, Mera
pled guilty to stealing gloves and other PPE from his employer during the
pandemic. Mera admitted he sold the stolen PPE under false pretenses and
profited over $1 million. This case was investigated by the United States
Secret Service (USSS). This case is being prosecuted by Assistant U.S.
Attorney Daniel Bernstein.

“The charges included in today’s announcement highlight the VA Office of
Inspector General’s dedication throughout the pandemic to protect veterans and
VA employees from those who would exploit the opportunity for fraudulent gain,”
said Special Agent in Charge David Spilker with the VA OIG Southeast Field Office.
“The VA OIG remains steadfast in our commitment to work with our law
enforcement partners to ensure the integrity of VA’s vital supply chain.”

“The FDA continues to monitor the marketplace to ensure that medical devices are
safe and effective for American consumers,” said Special Agent in Charge Justin
Fielder, FDA Office of Criminal Investigations’ Miami Field Office. “Today’s
announcement should serve as a reminder that the FDA is continuing to collaborate
with our fellow law enforcement partners to bring to justice those who place profits
above the public health.”

Cases Against COVID-19 Loan Preparers

A number of loan preparers have been charged, including:

• U.S. v. Pete Andrew Cohen, Case No. 24-CR-60017: Cohen, 56 of
Miramar, Fla., was the president of Taxez Taxez Taxez Incorporation in
Miramar. From June 2020 through June 2021, the defendant caused the
filing of approximately $3 million in fraudulent PPP loan applications that
falsely and fraudulently inflated the number of employees and payroll
figures for the applicants. The defendant also arranged for PPP loan
borrowers to create false and fraudulent payroll information using a payroll
service. Cohen pled guilty and is scheduled to be sentenced on Oct. 17, before
U.S. District Judge Rodney Smith. This case was investigated by Internal
Revenue Service Criminal Investigation (IRS-CI) and Federal Deposit
Insurance Corporation Office of Inspector General (FDIC-OIG). This case is
being prosecuted by Senior Litigation Counsel Michael N. Berger.
• U.S. v. Marc Prince, Case No. 24-CR-20214: Prince, 41 of Miramar,
reached out to various small business owners, directly or indirectly, to offer
to obtain PPP loans. From June 2020 through April 2021, Prince caused the
filing of approximately $3 million in fraudulent PPP loan applications that
falsely and fraudulently inflated the number of employees and payroll
figures for the applicants. Prince charged a fee, typically, of around 20
percent of the value of the PPP loan. Prince pled guilty and is scheduled to
be sentenced on Oct. 17, before U.S. District Judge Darrin P. Gayles. This
case was investigated by IRS-CI, FDIC-OIG, and HSI. This case is being
prosecuted by Senior Litigation Counsel Michael N. Berger.

“These charges demonstrate the FDIC OIG's commitment to working with our law
enforcement partners to investigate allegations of fraud in COVID-19 relief
programs and other financial crimes that threaten to undermine the safety and
soundness of our Nation's financial institutions,” said Special Agent in Charge Kyle
A. Myles, of the FDIC OIG Atlanta Region.

“It has been four years after the enactment of a key pandemic-era law and IRS-CI
still continues to investigate cases related to the CARES Act,” said Matthew D. Line,
Special Agent in Charge of the IRS-CI Miami Field Office. “These cases cover a wide
range of criminal activity, including tax, money laundering, fraudulently obtained
loans, credits and payments meant for American workers, families, and small
businesses. In the last year alone, IRS-CI has opened nearly 700 new COVID fraud
investigations nationwide that collectively add up to $5 billion. If you committed
fraud, know that we are working hard every single day to find you and hold you
accountable.”

Theft of Employee Retention Credit Checks

This office has charged the theft of employee retention checks, for example:

• U.S. v. Madelein Olivia, Case No. 24-CR-20323: Olivia, 52, of Miami,
was indicted by a grand jury for stealing a $7 million Employee Retention
Credit (ERC) check issued to a victim business where she was not
employed. ERC checks are refundable tax credits for certain eligible
businesses and tax-exempt organizations that had employees and were
affected by the COVID-19 pandemic. Treasury Inspector General for Tax
Administration (TIGTA) investigated the case. This case is being handled by
Assistant U.S. Attorney Altanese Phenelus.

An indictment, information, and complaint contain mere allegations. All
defendants are presumed innocent unless and until proven guilty in a court of law.

For more information regarding the Department of Justice’s response to the
pandemic visit https://www.justice.gov/coronavirus. Additional information
regarding the Strike Force may be found at
https://www.justice.gov/opa/pr/justice-department-announces-covid-19-fraud-
strike-force-teams.

Anyone with information about allegations of attempted fraud involving COVID-19
can report it by calling the Department of Justice’s National Center for Disaster
Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form
at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

Related court documents and information may be found on the website of the
District Court for the Southern District of Florida at www.flsd.uscourts.gov or
at http://pacer.flsd.uscourts.gov under the case numbers referenced above.

###

CONTACT: Public Affairs Unit USAFLS.News@usdoj.gov
U.S. Attorney’s Office www.justice.gov/usao-sdfl
Southern District of Florida Twitter @USAO_SDFL

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