YANKEETOWN, Fla. — A freshwater spring bubbles amid the mangroves, cabbage palms and red cedars on Sweetheart Island, a two-acre uninhabited patch of paradise about a mile off the coast of this little Gulf Coast town. The view westward holds the promise of dazzling sunsets. It may have seemed like an ideal getaway for Florida businessman Patrick Parker Walsh. Instead, he’s serving five and half years in federal prison for buying Sweetheart Island with nearly $8 million in stolen federal COVID-19 relief funds.
Walsh is one of thousands of thieves who perpetrated the greatest grift in U.S. history. They potentially plundered more than $280 billion in federal COVID-19 aid; another $123 billion was wasted or misspent. An analysis by The Associated Press estimated that the loss represents close to 10% of the $4.3 trillion the U.S. government has disbursed to mitigate the economic devastation wrought by the Covid-19 pandemic.
An AP review of hundreds of pandemic fraud cases presents a picture of thieves and scam artists who spent lavishly on houses, luxury watches and diamond jewelry, Lamborghinis and other expensive cars. The stolen aid also paid for long nights at strip clubs, gambling sprees in Las Vegas and bucket list vacations.
Their crimes were relatively simple: The government’s goal was to get cash into the hands of struggling people and businesses with minimal hassle, particularly during the early stages of the COVID-19 crisis. Safeguards to weed out the swindlers were dropped. As Walsh’s case and thousands of others have shown, stealing the money was as easy as lying on an application.
Nearly 3,200 defendants have been charged with COVID-19 relief fraud, according to the U.S. Justice Department. About $1.4 billion in stolen pandemic aid has been seized. Top Justice Department officials are undeterred by the enormity of the task. They’ve created special “strike forces” to hunt down COVID-19 aid thieves and have vowed not to give up the chase.
Vinath Oudomsine of Georgia created a fake company that he claimed made $235,000 a year and had 10 employees. A few weeks after Oudomsine applied for the pandemic aid, the government rushed him $85,000 to keep his non-existent business afloat. Oudomsine spent nearly $58,000 on a 1999 Charizard Pokémon card, which depicts a gold dragon-like creature, jaws wide open, poised to attack. At his sentencing, U.S. District Judge Dudley H. Bowen called Oudomsine’s theft “an $85,000 insult” to a country reeling from the pandemic.
Walsh, who operated a small fleet of cigar-shaped blimps before the pandemic, exploited the system, submitting more than 30 fraudulent applications for emergency pandemic aid and received $7.8 million. A judge sentenced him in January to more than five years behind bars. As part of his plea deal, Walsh agreed to return the $7.8 million he stole and to sell Sweetheart Island, which was among his first purchases with the stolen federal money, according to the court records. Prosecutors said Walsh used $90,000 of those funds to help finance the $116,000 island purchase. Florida property records show that the island was sold for $200,000 at the end of June.
