Fraud Schemes in the time of the COVID-19 Pandemic

The severe economic impact of the coronavirus (COVID-19) crisis continues to be felt as the unemployment rates rise. In the United States, the number of cases continues to rise, according to the Centers for Disease Control and Prevention (CDC), and people have been rushing to buy personal protective equipment (PPE). Many ‘agents,’ ‘consultants’ and fraudsters are taking advantage of the current climate of uncertainty and fear of individuals and well-intentioned companies who are attempting to buy protective personal equipment.  Thus, these individuals and businesses can become victims of white-collar offenses such as a scheme to defraud by false or fraudulent pretenses, representations, or promises.

According to the New York Times, Washington State’s unemployment system was the target of a sophisticated fraud scheme in which “hundreds of millions of dollars in unemployment funds” were stolen. The unemployment system is not the only target; the coronavirus scams are spreading as fast as the virus. Consumer complaints to the Federal Trade Commission (FTC) related to the coronavirus have increased as fraudsters are using robocalls, phishing e-mails and texts and other forms of tactics as new economic and medical concerns arise. The “Consumer Sentinel Network Reports for New York” by the Federal Trade Commission (FTC) shows that as of June 18, 2020, there have been a total of 5,436 reports of coronavirus-related fraud and $4.19M in fraud loss.

In fact, an Upstate New Yorker is facing charges in connection with a coronavirus scam to sell non-existent face masks, according to The Associated Press. Thousands of Americans continue to be defrauded by coronavirus scams that run the gamut from fake getaways, calls, or e-mails about checks from the government, to test kits. Consequently, investigators have uncovered “an array of counterfeit or adulterated products, from COVID-19 tests kits and treatments to masks and cleaning products.”

Below are some safety tips to help avoid coronavirus (COVID-19) scams as recommended by the Federal Trade Commission and types of coronavirus scams to look out for:

  • Do not respond to robocalls – Scammers are sending texts, e-mails, and/or calls about government checks. The Internal Revenue Service (IRS) has issued a news release warning about the coronavirus-related scams tied to economic impact payments/stimulus checks. Also, there has been a rise in robocalls ranging from Insurance fraud and health care fraud to work-at-home schemes.
  • Ignore offers for vaccinations and home test kits – Many people have become victims to false promises of cures.
  • Do not share personal information such as Social Security numbers, credit card numbers, Medicare numbers, etc. in response to a call/text/e-mail to verify your information.
  • Be wary of fundraising or donations for coronavirus victims or research
  • Be wary of unemployment insurance fraud – Individuals can become victims of identity theft.

If you are under investigation for any allegations of fraud in New York City, it is in your best interest to contact an experienced criminal defense attorney.