Uncovering the Sinister Scheme: Gang Members' Fraudulent COVID-19 Relief Scam Exposed

In a shocking revelation, prosecutors have unveiled a disturbing scheme orchestrated by members of four separate San Diego-area gangs. The alleged fraud involved the fraudulent application for millions in COVID-19-related tax credits, resulting in a grand jury indictment charging 17 individuals with various felonies. The investigation, which began during an unrelated murder probe, has shed light on the lengths these criminal organizations will go to exploit the pandemic for personal gain.

Exploiting Pandemic Relief for Personal Enrichment

The Fraudulent Scheme Unraveled

The defendants are accused of submitting fraudulent tax claims for sick and family leave credits intended to assist self-employed individuals affected by the COVID-19 pandemic. Prosecutors allege that the defendants deliberately exceeded the maximum 60-day leave period allowed, with some claiming between 790 and 15,678 days of leave for a single year. This blatant disregard for the rules and regulations governing these relief programs is a testament to the brazen nature of the alleged scheme.

Purchasing Lavish Luxuries with Ill-Gotten Gains

According to prosecutors, the alleged mastermind behind the operation, 31-year-old Stephen Pittman Jr., is accused of recruiting co-conspirators and assisting them in filing the false claims. Prosecutors further allege that Pittman used the fraudulently obtained funds to indulge in a lavish lifestyle, purchasing diamond-encrusted Cartier and Rolex watches, three diamond chains, and a diamond-encrusted necklace bearing his gang moniker, "Blu Flame," with the "B" crossed out.

The Staggering Scale of the Fraud

The defendants are said to have claimed credits for pandemic relief totaling over .2 million, receiving approximately .75 million, which they then spent on personal items that prosecutors believe benefited them and their respective gangs. The fraudulent tax returns resulted in IRS payments ranging from ,645 to 9,153 for each defendant.

The Unrelated Murder Investigation that Exposed the Scam

The alleged fraud was initially brought to light during an unrelated murder investigation, when a suspect's cell phone revealed evidence of a fraudulent tax refund. This unexpected discovery has since led to a murder conviction and a life without parole sentence for one defendant, as well as murder charges against several others, including Haben Haile, who is also charged in the fraud indictment.

The Devastating Impact on the Community

San Diego County District Attorney Summer Stephan has warned the public that this type of fraud is not just about the money lost, but the potential for the funds to be used by gangs to acquire more weapons, drugs, and to fuel human trafficking and other criminal activities that poison the community. The defendants are charged with 81 felony counts, including conspiracy to commit a crime, filing a fraudulent tax return, assisting in the filing of a fraudulent tax, receiving stolen property, and money laundering.

The Apprehension of the Suspects

Of the 17 defendants, 14 were arrested on Tuesday, while two others were already in custody at the time, and one remains at large. The scale and complexity of this investigation demonstrate the dedication and resourcefulness of law enforcement in uncovering and dismantling these sophisticated criminal networks.