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The Path To Fraud-dom

Senior Director of Strategic Alliances
LexisNexis Risk Solutions - Government

Before the COVID-19 pandemic even started, Luz Paulino was on the path to fraud-dom. Paulino owned and operated Agape Financial Services, a company that provided tax preparation and notary services. And she also filed fraudulent income tax returns for her own benefit. Central to the success of Paulino’s criminal activities was her systematic exploitation of stolen identities and falsified tax returns. Using the names and Social Security numbers of unwitting individuals, Pauling concocted fraudulent federal tax returns for the calendar year 2019. To evade detection, Paulino falsely attributed the preparation of these returns to former employees of Agape Financial Services. How dare they quit!

Paulino was able to extend her fraudster reach in the chaos and urgency surrounding the COVID-19 pandemic. Timing is everything when it comes to fraud. Between June 2020 and October 2021, Paulino submitted fraudulent applications to the Small Business Administration for COVID-19 Economic Injury Disaster Loans (EIDL). These applications falsely claimed substantial financial losses for fictitious companies purportedly impacted by the pandemic. Paulino also used stolen identities of individuals living in California, Michigan, and Indiana.

Paulino was initially charged by criminal complaint in December 2019. But due to the pandemic virtually all facets of the justice system were thrown into disarray. It wasn’t until January of 2021 that Paulino was indicted by a federal grand jury. Just enough time for Paulino to steal more than $2.1 million in COVID-19 loans. On June 27, 2024, Paulino pleaded guilty.

Great job by the COVID-19 Fraud Enforcement Task Force in this case.

Today’s Fraud of The Day is based on article “Lawrence Woman Luz Paulino Pleads Guilty to Multi-Million Dollar Fraud Schemes Targeting Banks and SBA” published by Regtech Times on June 27, 2024.

In a significant legal development, Luz Paulina, a 42-year old resident of Lawrence, Massachusetts, pleaded guilty in federal court in Boston to orchestrating elaborate fraudulent schemes that targeted financial institutions and the Small Business Administration (SBA). She entered her plead before United States District Judge Richard G. Stearns, marks a critical milestone in a complex legal saga that began unfolding in December 2019.

Luz Paulino, the owner and operator of Agape Financial Services, a Lowell-based company offering tax preparation and notary services, admitted guilt to a litany of charges including bank fraud conspiracy, bank fraud, wire fraud, and aggravated identity theft. These charges stemmed from two distinct but interrelated schemes that collectively defrauded banks and federal relief programs of millions of dollars.

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