Oakland woman sentenced to three years for million dollar pandemic fraud | USAO-NDCA

OAKLAND — A federal court sentenced Christina Burden today to 36 months in prison after pleading guilty to two counts of bank fraud and two counts of money laundering, US Attorney Stephanie M. Hinds announced; US Department of Treasury, Treasury Inspector General for Tax Administration (TIGTA), Special Agent in Charge Rod Ammari; Internal Revenue Service (IRS-CI) Special Agent for Criminal Investigations, Mark H. Pearson; and Craig D. Fair, Special Agent in Charge of the Federal Bureau of Investigation (FBI). The sentence was handed down by U.S. District Judge Yvonne Gonzalez Rogers.

Christina Burden, 32, of Oakland, was originally charged on Feb. 3, 2021, in a federal complaint alleging bank fraud in obtaining pandemic relief funds from the Paycheck Protection Program (PPP) from the Federal Government and the Economic Disaster Loan Program (EIDL) for it shell entity “Blessing Box Co LLC.” This entity was part of several fictitious entities, including the “Burden Consulting Group LLC”, which Burden used in his fraudulent scheme. As noted in the complaint, the PPP is administered by the United States Small Business Administration under the CARES (Coronavirus Aid, Relief, and Economic Security) Act. The CARES Act was signed into law by the US Congress in March 2020 to provide emergency financial assistance to millions of Americans suffering from the disastrous economic effects caused by the COVID-19 pandemic. PPP loan proceeds were distributed to defaulting businesses for limited, identified business expenses such as payroll costs, mortgage interest, rent and utilities. The PPP allowed interest and principal on a PPP loan to be fully forgiven if the company spent the loan proceeds on eligible business expenses and used at least 60% of the PPP loan proceeds for payroll expenses. Similarly, the EIDL program provided low-interest loans to small businesses in disaster-affected regions, and EIDL funds became available to all states and territories due to the scale and severity of the COVID-19 pandemic.

In his plea agreement, Burden admitted to registering several shell companies with the California Secretary of State and then altering documents by inserting incorrect dates relating to the alleged business transactions in order to qualify the shell companies for loans from the PPP programs or EIDL. Along with his fraudulent applications to relief programs, Burden submitted false IRS tax documents, such as bogus IRS 940 and IRS W-3 forms. The IRS tax documents contained false statements about the number of company employees, payroll costs, and wages paid, among other misrepresentations. Burden admitted in her plea agreement that she was aware that the availability and amount of PPP and EIDL loans were tied to the dates the businesses were established and operated, the number of employees and salary costs, and that she had intentionally distorted all this information. In total, Burden fraudulently claimed she had 89 employees and a monthly payroll of more than $700,000 at her fictitious businesses, according to government documentation.

In total, Burden attempted to secure more than $4.5 million in pandemic relief loans. She admitted that she actually received $992,291 in fraudulently obtained PPP loans and $150,900 in fraudulently obtained EIDL loans and advances.

After receiving the fraudulently obtained loan proceeds, Burden used the money on a shopping spree for high-end luxury items and services. In a brief filed for the sentencing hearing, the government said Burden spent $184,000 on private jet travel, other airfare and hotel expenses; $124,000 on luxury purchases at Louis Vuitton, Neiman Marcus and Nordstrom; $16,000 in boat and car rentals; and $14,000 for restaurants and entertainment. Another $150,000 was spent on Mercedes, Land Rover and Nissan automobiles.

In addition to the 36-month prison sentence handed down for bank fraud and money laundering, U.S. District Judge Yvonne Gonzalez Rogers ordered Burden to pay restitution in the amount of $1,143,191. The sentence also included a three-year supervision period after Burden’s release from prison. Burden was ordered into custody to begin his sentence on April 7.

Abraham Fine is the Assistant U.S. Attorney pursuing the case with the help of Kay Konopaske and Laurie Worthen. The lawsuit is the result of an investigation by TIGTA, IRS-CI, the FBI and the US Small Business Administration, Office of Inspector General (SBA-OIG).

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