Robert K. Hall, a 73-year-old resident of Bloomington, Indiana, has been sentenced to 41 months in federal prison after pleading guilty to charges of conspiracy to commit wire fraud and conspiracy to commit money laundering, according to the United States Department of Justice. This decision was reached in the U.S. District Court for the Southern District of Indiana.
According to court documents, Hall was involved in a conspiracy that spanned from September 2019 to December 2020, where he collaborated with others to defraud multiple businesses using business email compromise schemes. In addition to this, they conspired to defraud various states and the Small Business Administration by exploiting COVID-19-related loan and unemployment programs. Hall and his co-conspirators also devised a system to launder the illicitly acquired funds through his personal bank accounts.
The elaborate scheme commenced in September 2019 when an employee of Victim Business 1 received a fraudulent email impersonating a well-known vendor the business had dealt with in the past. The email falsely claimed that, due to an audit involving the vendor’s primary bank account, all future payments should be directed to a different account. Hall was the holder of the account in question, masquerading as an electric company. This deception led to Business 1 unknowingly transferring $113,550 into Hall’s personal account.
In July 2020, following the enactment of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), a fraudulent application was submitted to the Small Business Administration for a Paycheck Protection Program (PPP) loan, unbeknownst to the intended beneficiaries. Instead, the loan proceeds were deposited into an account controlled by Hall. Hall replicated this modus operandi when his co-conspirators deceitfully applied for three Economic Injury Disaster Loans, using the identities of an individual and two businesses, diverting the benefits into Hall’s personal accounts, according to court documents.
In addition to these fraudulent activities, between May 2020 and December 2020, applications for unemployment benefits were submitted to multiple states, including Washington, Pennsylvania, Michigan, Ohio, Colorado, and Arizona, on behalf of over a dozen individuals whose identities had been stolen. The unemployment benefits were directed into accounts under Hall’s control and were subsequently disbursed to his co-conspirators, according to the DOJ.
Once Hall had received the fraudulent deposits in his accounts, he retained approximately 20% of the funds as compensation for his role in the schemes. The remaining funds were transferred to his co-conspirators through checks and Bitcoin purchases. In total, Hall attempted to steal $668,746.14. Some of these transactions were blocked or reversed, resulting in Hall successfully acquiring $399,868.36 from the fraud schemes, according to the DOJ.
Zachary A. Myers, the U.S. Attorney for the Southern District of Indiana, commented on the case, stating, “This defendant played a critical role in multiple fraud schemes, including stealing hundreds of thousands of dollars from vital relief programs created to support individuals and businesses in the midst of a global pandemic.” Myers expressed gratitude to the U.S. Secret Service and the dedicated prosecutors for their unwavering efforts to bring the perpetrators of such fraudulent schemes to justice.
Jeffrey R. Adams, Special Agent in Charge of the U.S. Secret Service Indianapolis Field Office, emphasized the importance of combating such fraud, saying, “Hall and his co-conspirators took advantage of government programs intended to assist small businesses and individuals during the COVID-19 pandemic.” He reassured the public that the Secret Service remains committed to aggressively pursuing those who threaten the financial infrastructure of the United States.
The case was thoroughly investigated by the U.S. Secret Service, and the sentence was handed down by U.S. District Court Judge Richard L. Young. Judge Young additionally ordered that Hall be supervised by the U.S. Probation Office for three years following his release from federal prison.
U.S. Attorney Myers extended his thanks to Assistant United States Attorney Matthew B. Miller, who was responsible for prosecuting this case.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal resources to combat and prevent pandemic-related fraud. The task force aims to investigate and prosecute those engaged in fraudulent activities related to the COVID-19 pandemic and to prevent fraud by enhancing coordination among various agencies. Individuals with information about attempted fraud related to COVID-19 are encouraged to report it to the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.