WASHINGTON - The Internal Revenue Service (IRS) has released new statistics marking the fourth anniversary of the Coronavirus Aid, Relief and Economic Security (CARES) Act. The data reveals that the IRS Criminal Investigation (CI) division has probed 1,644 cases involving potential COVID-related tax fraud and money laundering, amounting to nearly $9 billion. A significant increase in cases was noted over the past year, with many involving fraudulent loans, credits, and payments intended for American workers and small businesses.
As of February 29, 795 individuals have been indicted in connection with these alleged crimes, with 373 of them receiving an average sentence of 34 months in federal prison. The CI has maintained a 98.5% conviction rate in these cases.
IRS Commissioner Danny Werfel emphasized the importance of CI's role in safeguarding the tax system and expressed that the additional funding from the Inflation Reduction Act will further support CI's efforts to combat fraud. This includes improved taxpayer services, new technology, and broader IRS transformation initiatives.
CI Chief Guy Ficco highlighted the ongoing commitment to pursuing those who exploit government programs, with nearly 700 new investigations opened in the last year alone, totaling about $5 billion in potential fraud.
Notable recent sentencings include Rami Saab, sentenced to 10 years in prison and ordered to pay $9.6 million in restitution for orchestrating a scheme to fraudulently obtain over $32 million in loans. Terrence L. Pounds received a 94-month sentence and was ordered to pay more than $4.2 million for committing wire fraud and money laundering related to the Small Business Administration's loan programs.
The CARES Act, enacted on March 27, 2020, was designed to provide emergency assistance during the economic strain caused by the pandemic. The IRS encourages individuals to report any known or suspected CARES Act fraud to their local CI field office.
This report is based on a press release statement from the IRS.
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