A new investigation has found yet another fraud-stricken program within the COVID-19 pandemic relief CARES Act. This time, in the little-known Shuttered Venue Operations Grants (SVOG). Congress created this grant to help theaters and music venues that had no money coming in because of the pandemic lockdown. Many entertainment businesses faced financial ruin because no one was going to fill the seats for any show. Unfortunately, SVOG seemed to have be no differentiators between the small indie hometown venue and the wealthy musician. Wealthy musicians like Post Malone, Chris Brown, and Lil Wayne, to name a few, who got millions in taxpayer money. Even as some of them spent lavishly on homes and other acquisitions like a sword-forging studio. Taxpayers’ money going towards a shed for a millionaire to make blades. Interesting hobby yet really has nothing to do with shuttered venues around the country.
Some staff at NKSFB, an accounting and wealth-management firm that eventually helped bring in more than $200 million from SVOG applications, were initially hesitant to submit applications for their clients’ touring companies. Several people at NKSFB believed their clients didn’t actually qualify and were worried that their clients would face bad publicity if word got out. But supposedly everyone was doing it. And the larger risk for NKSFB became the possibility of getting fired or perhaps sued if they didn’t get their clients the grants. The overwhelming majority of clients chose to apply. But not everyone.
At least one artist said no. Paul Anka, the Canadian American singer and songwriter who wrote Frank Sinatra’s famous song “I Did It My Way”. He decided was “being fed “BS” by his NKSFB consultant” and that he didn’t qualify. Or maybe he just knew taking money from the U.S. taxpayer and small venues wasn’t the right thing to do. Either way, shout out to Paul Anka for doing it his way.
Today’s Fraud of The Day is based on article “Pop stars got millions in pandemic aid that raised red flags for their accountants — but they took the cash anyways” published by Business Insider on July 26, 2024.
A major Los Angeles accounting firm that caters to music stars was privately worried that its artists could be breaking the law by applying for millions of dollars in pandemic-era grants from the Small Business Administration, court records show.
Congress created the Shuttered Venue Operators Grant in 2021 to help theaters and indie music venues stay in business during the pandemic lockdowns. As the name implies, the grants — which were not required to be paid back — were intended for theater owners, performing-arts companies, promoters, producers, and other behind-the-scenes businesses that had no money coming in.
