Oakland woman charged with scheme to defraud millions from Paycheck Protection Program
A close up shot of a pair of handcuffs on a table.
OAKLAND, Calif. - Federal law enforcement officials arrested an Oakland woman Friday for her alleged role in a scheme to illegally obtain some $4.5 million in federal relief loans.
According to the federal criminal complaint filed by the U.S. Attorney's office, Christina Burden, 31, is charged with one count of bank fraud after she applied for and received a $684,375 loan last June from the Paycheck Protection Program for her shell company "Blessing Box Co. LLC."
Between April and June 2020, Burden allegedly submitted nine other fraudulent applications to the PPP, which was established last March to help businesses keep their employees on payroll and afford expenses like interest on mortgages, rent and utilities during the coronavirus pandemic.
Burden also submitted a fraudulent application for the Economic Injury Disaster Loan Program.
Burden ultimately received $307,916 in forgivable PPP loans and a $150,900 EIDL Program loan in addition to the initial $684,375 loan, but allegedly attempted to obtain more than $4.5 million in loans through the use of four different shell entities, according to the complaint.
Burden spent the bulk of the loan money, the complaint alleges, on private jet travel, hotel and boat rentals, expensive cars and goods from Nordstrom, Tumi, Wayfair, Louis Vuitton, Neiman Marcus, Sunglass Hut and the San Francisco Giants' Dugout Store.
None of the money Burden received was used to recoup expenses allowed under the PPP or EIDL programs, the complaint alleges.
"The Paycheck Protection Program provides a financial lifeline to needy businesses and their employees," U.S. Attorney David Anderson said. "We allege that Christina Burden obtained PPP funds by fraud, submitting false business information, false employee numbers, false bank statements and false tax returns. She used those funds for a spending spree on entertainment, luxury goods and high-end excursions."
The U.S. Attorney's office worked with the inspector general for tax administration within the U.S. Treasury Department, the FBI and the Internal Revenue Service to investigate Burden's alleged fraud.
Investigators with the IRS and Treasury Department found that Burden's loan applications falsely certified that all four businesses were operating before Feb. 15, 2020, and each had up to 89 employees and more than $700,000 in monthly payroll expenses.
However, the complaint alleges that Burden submitted doctored bank records to attest to each company's payroll expenses and that none of the companies ever submitted payroll tax forms.
"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 available to us to ensure the integrity of those programs and that they remain available to our community's small business owners," said Craig Fair, the FBI's special agent in charge for San Francisco.
The one count of bank fraud carries a maximum sentence of 30 years in prison and a $1 million fine, if Burden is convicted, according to Anderson's office.
Burden was arrested Friday morning in Austin, Texas, and is expected to make her initial court appearance on Monday. She is expected to be ordered to appear in Oakland's U.S. District Court to face the bank fraud charge.
The date for Burden's initial court appearance in Oakland has not yet been set, according to Anderson's office.