YANKEETOWN, Fla. — Amidst the lush vegetation of mangroves, cabbage palms, and red cedars on Sweetheart Island, a secluded oasis spanning two acres, a freshwater spring gracefully bubbles. Located approximately a mile off the coast of the serene Gulf Coast town of Yankeetown, this uninhabited patch of paradise offers a picturesque escape. With pelicans gracefully divebombing into the cool waters of Florida’s Withlacoochee Bay nearby and the promise of breathtaking sunsets in the west, Sweetheart Island may have seemed like the ideal getaway for Florida businessman Patrick Parker Walsh. However, instead of enjoying the fruits of his ill-gotten gains, Walsh finds himself serving a five and a half-year sentence in federal prison for his audacious act of stealing nearly $8 million in federal COVID-19 relief funds, which he shamelessly used to purchase the island.
While Walsh’s acquisition of a private island may be one of the more peculiar purchases made by pandemic fraudsters, his crime is far from unique. He stands among the thousands of thieves who have perpetrated what can only be described as the most audacious grift in the history of the United States. Collectively, these criminals have potentially plundered over $280 billion in federal COVID-19 aid, with an additional $123 billion being wasted or misspent. Shockingly, this amounts to almost 10% of the $4.3 trillion disbursed by the U.S. government to alleviate the economic devastation inflicted by the COVID-19 pandemic, as analyzed by The Associated Press.
A comprehensive review conducted by the AP of numerous pandemic fraud cases reveals a startling portrait of thieves and scam artists who shamelessly indulged in a lavish lifestyle. Their ill-gotten gains were spent on opulent homes, luxury watches, diamond jewelry, high-end vehicles such as Lamborghinis, and extravagant vacations, including nights at strip clubs and gambling sprees in Las Vegas. The simplicity of their crimes is even more astonishing. In an effort to quickly provide financial assistance to struggling individuals and businesses during the early stages of the COVID-19 crisis, the government relaxed safeguards intended to weed out fraudsters. As Walsh’s case, along with countless others, exemplifies, stealing the money was as simple as submitting a fraudulent application.
These fraudsters hail from all walks of life and various corners of the globe. From a Tennessee rapper who boasted about effortlessly swindling over $700,000 in pandemic unemployment insurance on YouTube to a former pizzeria owner and host of a cryptocurrency-themed radio show who used stolen aid to purchase an alpaca farm in Vermont, the audacity of their crimes knows no bounds. Even an ex-Nigerian government official managed to snatch approximately half a million dollars in COVID-19 relief benefits while flaunting a $10,000 watch and a $35,000 gold chain at the time of his arrest. The U.S. Justice Department has charged nearly 3,200 defendants with COVID-19 relief fraud, leading to the seizure of about $1.4 billion in stolen pandemic aid.
However, it is important to acknowledge that investigators cannot apprehend every single crook due to the sheer magnitude and complexity of the fraud. Pandemic-related cases often rely heavily on perishable digital evidence, and the financial trail can grow cold over time, according to Bob Westbrooks, the former executive director of the federal Pandemic Response Accountability Committee. Westbrooks grimly admits that the federal criminal justice system is ill-equipped to handle the unprecedented volume of pandemic relief fraud cases, which involve thousands upon thousands of domestic and foreign actors.
Yet, undeterred by the enormity of the task at hand, top officials at the U.S. Justice Department have established dedicated “strike forces” aimed at relentlessly pursuing COVID-19 aid thieves. They are resolute in their commitment to continue chasing down these criminals. “We’ll stay at it for as long as it takes,” proclaimed U.S. Deputy Attorney General Lisa Monaco in August.
In the pantheon of COVID-19 fraudsters, Konstantinos Zarkadas, a New York doctor suffering from crippling debt, has earned a place of dishonor. Zarkadas falsified no less than 11 separate applications for pandemic aid, amassing a staggering sum of almost $3.8 million, as stated by prosecutors. With this windfall, he indulged in extravagant purchases such as Rolex and Cartier wristwatches worth $140,000 for himself and his family members. Additionally, Zarkadas made a substantial down payment on a yacht. Astonishingly, he used approximately $3 million to settle part of a prior civil judgment against him for breaching a real estate lease. Prosecutors further revealed that Zarkadas audaciously returned $80,000 of the stolen funds to the government in an attempt to settle a federal lawsuit alleging violations of the Controlled Substances Act due to his improper dispensation of over 20,000 doses of a weight-loss drug without maintaining accurate records. Consequently, New York revoked Zarkadas’ medical license, and he was sentenced to over four years in prison for his pandemic aid theft.
Lee E. Price III, a Houston resident with prior felony convictions for forgery and robbery, epitomizes the high-rolling lifestyle that stolen pandemic aid can facilitate. Price defrauded the system of nearly $1.7 million by submitting fictitious aid applications on behalf of nonexistent businesses, according to court records. He wasted no time in splurging $14,000 on a Rolex and over $233,000 on a flashy white Lamborghini Urus, a luxury SUV capable of reaching 60 mph in just three seconds. Price also spent exorbitant amounts of money at the Casanova, a Houston strip club. His extravagant escapades resulted in a sentence of over nine years in prison.
Similarly, Vinath Oudomsine from Georgia fabricated the existence of a company that purportedly earned $235,000 annually and employed ten individuals. Shortly after submitting his pandemic aid application, the government rushed him $85,000 to sustain his non-existent business. Oudomsine proceeded to spend nearly $58,000 on a 1999 Charizard Pokémon card, a prized possession among collectors due to its depiction of a fierce, dragon-like creature. While Pokémon merchandise may not reach the astronomical prices of rare baseball cards, the collectibles associated with this popular franchise still command significant sums. During Oudomsine’s sentencing, U.S. District Judge Dudley H. Bowen chastised the fraudster, deeming his theft of $85,000 as an egregious insult to a nation already reeling from the devastating effects of the pandemic. Consequently, Oudomsine was sentenced to three years in prison.
Patrick Walsh’s descent into substantial fraud began with a legitimate attempt to salvage his aerial advertising businesses. Walsh operated a fleet of cigar-shaped blimps that proudly displayed corporate logos during high-profile events. However, in June 2017, one of his blimps tragically crashed and burned during the men’s U.S. Open golf tournament, leaving the pilot severely injured. This horrific incident led to a cascade of events, with Walsh’s clients abandoning him, forcing him to seek high-interest loans to sustain and expand his businesses. By 2019, his companies boasted impressive sales of $16 million and had successfully expanded into Latin America and Asian markets. Unfortunately, the arrival of the pandemic dealt a fatal blow to Walsh’s enterprises. His attorneys argued that COVID-19 did not merely slow down business; it extinguished it entirely. Overwhelmed by desperation, Walsh resorted to submitting over 30 fraudulent applications for emergency pandemic aid between March 2020 and January 2021. This audacious scheme yielded him a staggering $7.8 million, far exceeding what his companies would have qualified for under legitimate circumstances, as alleged by federal prosecutors.
While Walsh’s defense attorneys sought to portray his actions as desperate measures born out of necessity, U.S. District Judge Allen C. Winsor disagreed. In his eyes, Walsh’s crimes represented more than a momentary lapse in judgment. Consequently, Walsh was sentenced to over five years in prison. As part of his plea agreement, he must also repay the $7.8 million he stole and sell Sweetheart Island, which he initially acquired using the ill-gotten federal funds.
Prosecutors have revealed that Walsh utilized $90,000 of the stolen funds to contribute towards the $116,000 purchase of the island. Public records from Florida indicate that the transaction did, in fact, occur, further underscoring the audacity of Walsh’s actions.