What's with the free passes for COVID fraudsters?
/
Two days ago we posted on the sentence of probation handed to a former politician who’d created phony employees and hidden bank accounts to defraud taxpayers during the COVID “crisis” and wondered why he hadn’t been jailed.
Here’s an even worse case, reported yesterday:
CT woman who stole $1 million from COVID-19 loan program gets probation
NEW HAVEN — An East Granby woman who pleaded guilty to stealing $1.1 million from federal COVID-19 loan programs, funding a spending spree that included a $40,000 diamond ring and two Mini Coopers, was sentenced Thursday in federal court to three years of probation, according to the U.S. attorney's office.
Karen Gaston, 45, used fictitious and dormant companies to siphon money meant for ailing businesses through the Coronavirus Aid, Relief and Economic Security (CARES) Act, officials said. She pleaded guilty in June to wire fraud and illegal monetary transactions.
During her probation, U.S. District Court Judge Sarah F. Russell ruled that Gaston must spend four weekends incarcerated, 10 months of home detention and perform 500 hours of community service, according to U.S. Attorney for the District of Connecticut David X. Sullivan.
During a debt-clearing and shopping binge in 2020, Gaston used the ill-gotten funds to pay off her $477,000 home mortgage, while also spending about $30,000 at Tiffany and Co., $13,000 at Jimmy Choo and more than $14,000 at Macy’s and Nordstrom department stores, according to a sentencing memo submitted by Sullivan and Assistant U.S. Attorney Michael S. McGarry.
Gaston spent more than $10,000 at Crate and Barrel, $8,752.89 at Home Depot and $4,599 at California Closets and made out checks to cash for thousands of dollars, prosecutors said. The long spending list ranged from $4.28 for Friendly's ice cream to $39,521.63 for a diamond and platinum ring from jeweler Harry Winston, according to the sentencing memo. Gaston also bought a Toyota for her brother and a Mini Cooper each for her boyfriend and older daughter, authorities said.
But wait, there’s more!
Federal prosecutors noted that Gaston was convicted of defrauding Connecticut's Medicaid program last year in state court. As CEO of Elegant Clinical Corp., a vocational program for disabled adults in East Windsor, Gaston fraudulently billed the state for more than $52,000 between 2016 and 2019, state prosecutors said during her trial. The jury found her guilty of first-degree larceny by defrauding a public community and health insurance fraud. At her sentencing in December, Gaston received a suspended six-year sentence and five years of probation. She also was ordered to pay restitution, perform 200 hours of community service and serve nine months of home confinement subject to electronic monitoring, according to state authorities.
For the federal crimes, prosecutors had recommended a sentence of 37 to 46 months, describing Gaston in a sentencing memo as a greedy person who acted out of a sense of entitlement. Her spending on restaurants alone, prosecutors said, was "remarkable," and included totals of $6,000 at Mill on the River, more than $4,000 at the Tosca Restaurant and about $1,200 at Ruth's Chris Steakhouse.
Gaston revealed her character, prosecutors said, when she fraudulently listed her older daughter as part owner of one of the companies she used in the scheme. On the loan applications, Gaston lied about the status of her businesses, the number of workers and workers' wages and submitted bogus tax documents, authorities said. In all, she filched $1,163,910 in loan funds meant to help people fighting for financial survival, prosecutors said. Federal officials said Gaston agreed to make full restitution.