U.S. Attorney announces successful results of strategy to combat fraud related to COVID-19

U.S. Attorney for the Middle District of Florida Roger B. Handberg announced Wednesday that his work to combat COVID-19-related fraud has been, to date, successful.

Working with federal, state, and local law enforcement, Handberg said his office was able to form the COVID-19 Fraud Task Force to crack down on criminals taking advantage of assistance programs during the pandemic.

“Throughout the pandemic, my office and our law enforcement partners have used all available methods to combat fraud related to COVID-19, and we will continue to do so,” stated U.S. Attorney Handberg. “After the United States instituted multiple programs to financially assist those most harmed by the pandemic, criminals sought to defraud those programs for personal enrichment at the expense of the taxpayers who funded these programs. We will continue to disrupt these fraud schemes, prosecute those who commit crimes, and return ill-gotten gains through our efforts.”

The Task Force has prosecuted 28 defendants for fraud schemes, Handberg’s office said, collectively responsible for defrauding the U.S. of over $35 million. The schemes targeted the Paycheck Protection Program (“PPP”), Economic Injury Disaster Loans (“EIDL”), Unemployment Insurance (“UI”), and the Main Street Lending Program (“MSLP”). Of those actions, 18 have been found guilty, with the remaining 10 still facing prosecution.

Additionally, his office’s Asset Recovery Division and federal seizing agencies have completed the forfeiture of more than $14.3 million in PPP, EIDL, and UI funds that were fraudulently obtained, and more than $8.5 million in additional pandemic fraud proceeds have also been seized, or are pending civil or criminal forfeiture, his office said.

Fraud schemes included a PPP loan for $7.2 million by Don Cisternino for a non-existent movie production company. Handberg alleges that Cisternino used nearly $3.5 million of the loan to buy a 12,579-square-foot luxury home with seven bedrooms, 11 bathrooms, a four-car garage, theater room, resort-style pool and spa area, tennis courts, and a 5-stall horse barn. The United States was able to seize the property and sell it earlier this year for more than $4 million, Handberg’s office said. Cisternino was indicted in April after being extradited from Croatia.

The District’s Civil Division also combatted COVID-19-related fraud through its enforcement efforts. Included in its actions were the criminal charges brought against three men in Vietnam accused of using hundreds of web pages to steal money from U.S. consumers seeking to purchase personal protective equipment. The men are in custody in Vietnam and face criminal charges there.

The efforts are part of the U.S. Attorney General’s COVID-19 Fraud Enforcement Task Force that marshaled the resources of the U.S. Department of Justice, as well as those of partner agencies across the government, to combat and prevent pandemic-related fraud.