A 32-year-old Oakland woman who was arrested and charged last year in connection with a scheme to defraud the federal government out of $4.5 million in pandemic relief funds has just been sentenced to three years in prison and will have to pay more than a million dollars in restitution.
Christina Burden, who resided in Oakland but was arrested in Austin, Texas, in February 2021, is an accountant by trade, and federal prosecutors found she set up several front companies in 2020, including one called “Blessing Box Co LLC” and one called “Burden Consulting Group LLC”, and applied for millions of dollars in Payroll Protection Program (PPP) and Economic Disaster Loan Program (EIDL) loans. Although she is self-employed as an administrative and accounting consultant, Burden claimed in forged documents to have 89 employees and a monthly payroll of $700,000.
In total, she applied for 10 loans totaling $4.5 million and successfully received over $1 million, including $992,291 in fraudulent PPP loans. Investigators found that instead of using the funds to keep real businesses afloat, Burden spent the money on lavish travel expenses like private jets and hotels, and $124,000 was spent on shopping for luxury at Louis Vuitton, Neiman Marcus and Nordstrom. Another $150,000 was spent on three vehicles, including a Mercedes Benz and a Land Rover.
According to a statement released Thursday by the Justice Department, Burden pleaded guilty to two counts of bank fraud and two counts of money laundering.
United States District Judge Yvonne Gonzalez Rogers sentenced Burden to 36 months in federal prison plus three years of supervised release. In addition, she will have to pay $1,143,191 in compensation to the federal government.
The maximum sentence Burden could have faced was 30 years.
“Those who wish to defraud programs designed to help those in need should know that the FBI and our partners will pursue every investigative tool at our disposal to ensure the integrity of these programs and that they remain available to small business owners in our community,” said Craig Fair, FBI special agent in San Francisco, when Burden’s charges were first filed.
The PPP and EIDL programs stem from the CARES (Coronavirus Aid, Relief, and Economic Security Act) Act, passed by Congress in late March 2020, just as pandemic-related lockdowns shut down large swaths of the US economy, causing difficulties on many levels. . The PPP program issued a total of $800 billion in loans, all of which could be forgiven if companies maintained their workforces at pre-pandemic levels and spent 60% of the funds on payrolls – the rest on mortgages, rent, utilities, and other qualifying expenses.
An academic working paper released last August suggested that 15% of loans granted, or $76 billion, had at least one indicator of potential fraud. The study singled out the fintech companies that helped administer the program loans for displaying the highest possible fraud rate in their loan records.
The DOJ has been at work prosecuting several major cases of alleged fraud, including four individuals in Richmond and Sugar Land, Texas, who obtained $18 million in fraudulent PPP loans and requested a total of $35 million from loans. These four people were charged in December.
Photo: Giorgio Trovato