Major Arrests for COVID-19 Relief Fund Fraud
In a significant crackdown, the U.S. Department of Justice (DOJ) has arrested 14 individuals accused of stealing over $25 million in COVID-19 relief funds intended for small businesses. This extensive operation involves serious allegations against a network of criminals attempting to defraud the government, raising alarms about the integrity of financial support systems.
John Pasciucco, Acting Special Agent in Charge at Homeland Security Investigations in Los Angeles, disclosed that two federal complaints identified a total of 18 individuals involved. Of these, four are allegedly located in Armenia, complicating the prosecutorial process.
The charges against the defendants include conspiracy to defraud the government, wire fraud, bank fraud, and money laundering, among other offenses. Pasciucco emphasized the scale of the operation, stating, “This transnational criminal network sought to defraud the government of millions of dollars and almost succeeded.”
One prominent figure, 42-year-old William McGrayan, is alleged to be at the center of the scheme. He reportedly encouraged leaders of fake organizations to open bank accounts and create false documentation, including resumes and financial statements, to secure loans under deceptive pretenses. Prosecutors allege he misled various banks and defrauded the Small Business Administration’s Preferred Lender Program out of millions.
Another suspect, 37-year-old Samuel Shaw, is accused of fabricating a Paycheck Protection Program application under a bogus business name in 2021, resulting in over $700,000 in inaccurately awarded loans meant to provide economic relief during the pandemic.
Additionally, 32-year-old Mery Diamondz and her co-defendants allegedly orchestrated a scheme to fraudulently sell a fake company to another sham entity, securing around $3 million in federally guaranteed loans from the Small Business Administration.
During the operations, law enforcement seized approximately $20,000 in cash, money-counting machines, multiple phones and computers, as well as two loaded semi-automatic handguns and an array of ammunition. Such findings highlight not only the financial crimes but also a concerning level of potential violence associated with the alleged perpetrators.
Among those charged are Felix Parker, 77, from North Hollywood, and 47-year-old Axsel Markaryan, who is also known as Axel Mark and hails from Pacoima. Prosecutors warn that if convicted, these individuals could face decades behind bars, underlining the serious nature of their crimes.
This situation sheds light on the broader issue of fraud related to government relief programs, particularly those set up swiftly in response to the COVID-19 pandemic. While such programs are essential for supporting struggling businesses, they have also become a target for criminals seeking to exploit loopholes and commit fraud.
As this case unfolds, it serves as a critical reminder of the importance of vigilance and oversight in government programs designed to help citizens during times of crisis. Taxpayers deserve assurance that their hard-earned money is safeguarded from fraud and misuse.
The DOJ’s actions in this case should send a strong message: fraud will not be tolerated, and those who attempt to take advantage of federal programs for personal gain will face severe consequences. As we continue to navigate the aftermath of the pandemic, it is vital to maintain the integrity of relief efforts to ensure that support reaches those who truly need it.
The judicial process will now determine the fate of those charged, as authorities work diligently to hold criminals accountable and protect the interests of honest businesses and taxpayers alike.
