Clifton C. James, a 50-year-old resident of New Orleans, has been sentenced to five years of probation for his involvement in CARES Act fraud, money laundering, and filing false tax returns. The sentence was handed down by U.S. District Judge Jane Triche-Milazzo.
James was found guilty of making false statements to secure an $86,800 Paycheck Protection Program (PPP) loan on behalf of his business. He also stole $149,900 from the Small Business Administration (SBA) using a fraudulent application under the name Crescent City Tax Services, LLC. These funds were used to purchase a vehicle in California, constituting money laundering. Additionally, James filed a false tax document with the IRS claiming only $1.00 income for 2019.
Beyond probation, James is required to complete 50 hours of community service and pay restitution totaling $551,973 to the SBA and $233,645.65 to the IRS. A mandatory special assessment fee of $400 was also imposed.
The case highlights ongoing efforts by federal authorities to combat fraud related to COVID-19 relief programs. It was investigated by agents from the Pandemic Response Accountability Committee (PRAC) Fraud Task Force and involved multiple agencies including the U.S. Department of Veterans Affairs - Office of Inspector General and the Internal Revenue Service - Criminal Investigation.
Assistant U.S. Attorney Edward J. Rivera led the prosecution effort against James.
For more information on pandemic-related fraud prevention or reporting suspected cases, visit https://www.justice.gov/coronavirus or contact the National Center for Disaster Fraud Hotline at 866-720-5721.
