IRS CI is Continuing to Aggressively Target COVID-19 Fraud in 2025

Even though it has now been more than two years since the federal government ended its national emergency declaration for the COVID-19 pandemic, targeting COVID-19 relief fraud remains a top priority for IRS Criminal Investigation (IRS CI). Specifically, IRS CI is continuing to target both individual and corporate taxpayers for fraud under the Paycheck Protection Program (PPP), Employee Retention Credit (ERC), and Economic Injury Disaster Loan (EIDL) program. Here, Texas tax fraud lawyer Lawrence Brown discusses some of the IRS CI’s most recent efforts to target pandemic-era fraud:

July 18, 2025: PPP and EIDL Fraud Lead to Federal Bank Fraud and Conspiracy Convictions

On July 18, 2025, IRS CI announced the sentencing of an individual convicted of bank fraud conspiracy to commit wire fraud and bank fraud in connection with the submission of fraudulent PPP and EIDL loan applications. According to IRS CI, the individual fabricated or inflated payroll figures included on loan applications for eight business entities he controlled. The individual reportedly obtained nearly $3.5 million in fraudulent loans under the PPP and EIDL programs.

Following a conviction in federal court, the individual was sentenced to time served and five years of supervised release, including one year of home detention. He was also ordered to pay approximately $3.2 million in restitution and forfeit nearly $1.9 million.

July 16, 2025: EIDL Fraud Conviction Leads to $300,000 in Restitution and a Year and a Day in Federal Prison

On July 16, 2025, IRS CI announced the sentencing of an individual convicted of conspiracy to commit wire fraud in connection with the submission of fraudulent EIDL applications for two business entities held in his wife’s name. According to IRS CI, the individual’s wife is also facing federal charges, and an alleged co-conspirator in Texas is facing prosecution in Texas for “criminal matters related to the co-conspirator’s larger fraud scheme.”

IRS CI’s press release states that the individual submitted false information about “the businesses, their payroll and their financials,” and worked with the alleged co-conspirator in Texas to “maximiz[e] the chances of approval.”  Following his conviction for wire fraud, the individual was sentenced to a year and a day in federal prison and ordered to repay the nearly $300,000 in loans he fraudulently obtained.

July 10, 2025: PPP and EIDL Fraud Guilty Plea Leads to 15-Month Federal Prison Sentence and $750,000 in Restitution

On July 10, 2025, IRS CI announced that an individual who had previously pleaded guilty to PPP and EIDL fraud was sentenced to 15 months in prison, followed by two years of supervised release. He will also be required to pay more than $750,000 in restitution.

IRS CI’s press release states that the individual fraudulently obtained more than $1 million in PPP and EIDL funding for various business entities that he controlled. Along with submitting false information on his PPP and EIDL loan applications, IRS CI also states that the individual used “the majority” of the funds to cover personal and family expenses.

July 9, 2025: Cattle Farmer Pleads Guilty to $1.3 Million COVID-19 Relief Fraud Scheme

On July 9, 2025, a cattle farmer pleaded guilty to “providing a criminally false claim in order to obtain COVID relief funds.” Specifically, IRS CI reports that an investigation uncovered the cattle farmer’s submission of fraudulent PPP loan applications as well as fraudulent applications under the Coronavirus Food Assistance Program (CFAP). Similar to the cases discussed above, the IRS CI’s press release indicates that the cattle farmer submitted falsified payroll expenses in order to fraudulently obtain PPP loans.

IRS CI’s press release indicates that the cattle farmer faces up to five years in federal prison as a result of his guilty plea.

July 9, 2025: Submission of $3.4 Million in Fraudulent Pandemic-Era Tax Credits Results in $1.8 Million Refund Before Guilty Plea

Also on July 9, 2025, IRS CI reported that an individual pleaded guilty to submitting fraudulent ERC claims and fraudulent Sick and Family Leave Credit claims to the Internal Revenue Service. IRS CI’s press release states that the individual and his co-conspirators, “created phony businesses, which lacked any employees or operations, for the sole purpose of falsely claiming the credits.” In total, IRS CI reports that the individual and his co-conspirators submitted $3.4 million in false claims to the Internal Revenue Service, resulting in a $1.8 million refund.

The individual’s guilty plea includes convictions for conspiring to commit wire and mail fraud, aiding and assisting in the preparation of a false tax return, and money laundering. He faces decades of federal prison time and millions of dollars in criminal fines and restitution.

July 7, 2025: “Ghost Preparer” Pleads Guilty to $4 Million ERC Fraud Scheme

On July 7, 2025, IRS CI announced that an individual had pleaded guilty to serving as a “ghost preparer” for the submission of fraudulent ERC claims to the Internal Revenue Service. According to IRS CI, the individual “executed a scheme to defraud the United States by preparing and filing thirty-five IRS Forms 941 for himself and two clients that falsely claimed they were entitled to receive $4,112,297 in tax refunds based on fraudulently claimed ERCs.” The individual reportedly did not have a preparer tax identification number (PTIN) and did not list himself as a paid tax preparer on any of the returns.

As a result of his guilty plea, the individual faces up to 20 years in federal prison followed by a period of supervised release. He also faces restitution liability and monetary penalties.

These are not cases in which Brown Tax, P.C. provided legal representation. However, our firm does represent clients in PPP, ERC, and EIDL fraud investigations. If IRS CI is targeting you or your company for COVID-19 relief fraud, we invite you to contact us for more information.

Request a Consultation with Texas Tax Fraud Lawyer Lawrence Brown

As you can see, IRS CI is continuing to aggressively target COVID-19 relief fraud in 2025. Federal investigations involving allegations of PPP, ERC, and EIDL fraud present substantial risks, and experienced legal representation is essential for avoiding unnecessary consequences. If you would like to speak with Texas tax fraud lawyer Lawrence Brown in confidence, please call 888-870-0025 or request a consultation online today.