BOISE, Idaho — U.S. Attorney Josh Hurwit announced the formation of the District of Idaho’s COVID-19 Fraud Task Force Wednesday. The team will investigate and prosecute pandemic-related fraud.
The task force is made up of members from the following agencies:
- U.S. Small Business Administration, Office of Inspector General
- Internal Revenue Service, Criminal Investigation
- U.S. Department of Treasury, Inspector General for Tax Administration
- Federal Bureau of Investigation
- Federal Deposit Insurance Corporation, Office of Inspector General
- Social Security Administration, Office of Inspector General
- U.S. Department of Agriculture, Office of Inspector General
- U.S. Department of Health and Human Services, Office of Inspector General
- U.S. Postal Inspection Service
- U.S. Secret Service, Boise Resident Agency and Spokane Resident Office
U.S. Attorney Hurwit also announced that Nicholas Jones, who ran against Russ Fulcher in the 2020 Republican Primary was sentenced Wednesday to 30 months in federal prison for wire fraud and filing falsified campaign finance disclosures. Jones was also ordered to pay a $100,000 fine, and the U.S. Attorney’s Office has already received a separate restitution payment of over $90,000 from Jones.
Jones, the CEO, and Owner of "Good Burger" received COVID-19 relief funds totaling $753,600. The U.S. Attorney's office says despite certifying the funds would only be used for business-related expenses Jones used a significant portion of the funds for personal use, including car payments, life insurance policies, and his mortgage. Hurwit says Jones also purchased a significant amount of stocks and investments with the relief funds.
Jones used a portion of COVID-19 relief funds for campaign purposes. In addition to paying for political advertising, he used PPP funds to pay his restaurant employees to work for his congressional campaign.
The U.S. Attorney's office says other examples of cases that the COVID-19 Fraud Task Force investigated and that led to charges include:
- Douglas Wold, 50, of Meridian, was sentenced to 41 months in federal prison for wire fraud, mail fraud, and money laundering in December 2021. During the early months of the pandemic, Wold committed wire fraud by submitting fraudulent payroll requests to his employer. He also committed mail fraud with respect to a COVID-19 testing program by issuing fraudulent invoices to his employer Fry Foods in the name of his business, Hala Lallo Health, when, in fact, the testing was provided by another entity and at a greatly lower cost. Wold deposited the funds he received into a bank account he controlled and did not pay the health provider that actually conducted the testing. Wold committed money laundering by transferring $69,116.48 in proceeds from his frauds for the purchase of a speedboat and trailer, which the Government has since recovered.
- Jeff C. Vogt, of Caldwell, fraudulently obtained $250,000 in CFAP funds based on his false claim that he produced 22,480,000 pounds of dry onions that were shipped but not sold between January 15, 2020, and April 15, 2020. A civil complaint was filed against Vogt alleging violations of the False Claims Act and common law fraud. After Vogt failed to respond, a default judgment for $761,665 was entered against him.
- Lawrence Sikutwa, 43, of Boise, was charged with bank fraud, aggravated identity theft, and money laundering charges in an indictment filed in October 2022. The charges arise from a scheme to defraud two banks by obtaining $337,976 in PPP loans and then allegedly using the loan proceeds for personal and other non-business-related expenses. According to court documents, the loan applications were allegedly fraudulent because, among other things, they contained false representations and certifications about the businesses’ average monthly payroll, the number of employees, and the intended use of the funds for business-related expenses, including payroll.
- Khadijah Chapman, 58, of Atlanta, Georgia; Daniel Labrum, 41, of South Jordan, Utah; and Eric O’Neil, 57, of Bethel, Connecticut, were charged in three separate indictments filed in July 2022 with bank fraud for fraudulently obtaining PPP loans from a financial institution located in Boise. According to court documents, the defendants, along with others allegedly falsified information, then submitted fraudulent documents to collectively obtain over $2.4 million in relief funding guaranteed by the SBA for small businesses struggling with the economic impact of COVID-19.
