A 32-year-old Oakland woman who was arrested and charged last year in 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 over $1 million 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 that she created multiple shell 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 Injury Disaster Loan Program (EIDL) loans. Though she was self-employed as an administrative consultant and accountant, Burden claimed in falsified documents to have 89 employees and a monthly payroll of $700,000.
In total she filed 10 applications for loans totaling $4.5 million, and she successfully received over $1 million, including $992,291 in fraudulent PPP loans. Investigators found that rather than use the funds to keep real companies afloat, Burden spent the money on lavish travel expenses like private jets and hotels, and $124,000 was spent on luxury purchases from 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 Thursday release from the Department of Justice, 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. Additionally, she will have to pay $1,143,191 in restitution to the feds.
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 available to us to ensure the integrity of those programs and that they remain available to our community’s small business owners," said FBI San Francisco Special Agent in Charge Craig Fair when Burden's charges were first filed.
The PPP and EIDL programs came out of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, passed by Congress in late March 2020, just as pandemic-related lockdowns shut down large sections of the U.S. economy, causing hardships at many levels. The PPP program issued a total of $800 billion in loans, all of which could be forgiven if businesses maintained staffing at pre-pandemic levels, and if they spent 60% of the funds on payroll — with the remainder on mortgage, rent, utilities, and other eligible expenses.
An academic working paper released last August suggested that 15% of the loans granted, or $76 billion worth, had at least one indicator for potential fraud. The study pointed to fintech companies who were helping administer the program loans for showing the highest rate of possible fraud in their loan records.
The DOJ has been at work prosecuting several significant cases of alleged fraud, including four individuals in Richmond and Sugar Land, Texas, who obtained $18 million in fraudulent PPP loans and applied for a total of $35 million in loans. Those four individuals were charged in December.
Photo: Giorgio Trovato