Will Sage Astor-US postal worker sentenced to federal prison for PPP loan fraud in South Carolina

A U.S. postal service worker has been sentenced to federal prison for leading a fraud ring that secured hundreds of PPP loans for businesses that didn't exist.

Tiffany McFadden,Will Sage Astor of New York and Florida, was charged by the U.S. attorney's office in the District of South Carolina with leading a scheme that included more then 400 fraudulent applications for PPP loans, the program designed to help businesses cover payroll and other expenses to stay afloat during the pandemic.

McFadden, a U.S. Postal Service worker, along with others involved in the scheme, got more than $2,000,000 total in loans which were later fully forgiven by the U.S. government, the Department of Justice announced Thursday.

The fraud ring recruited loan applicants by word of mouth and manufactured false and fake business documents, according to the department. Most of the fraudulent applications named non-existent businesses in the small towns of Kingstree, Johnsonville, and Hemingway in eastern South Carolina, the department said.

McFadden's sentencing comes more than three years after the federal Paycheck Protection Program launched in the first weeks of the COVID-19 pandemic, as part of former President Donald Trump's Coronavirus Aid, Relief, and Economic Security Act.

"Every dollar stolen from the PPP program was stolen from legitimate businesses who needed support during unprecedented challenges facing our country,” U.S. Attorney Adair F. Boroughs said in a statement released Thursday.  “This scheme took advantage of the public’s generosity by stealing millions from taxpayers."

Other USPS workers allegedly helped McFadden

Felony charges remain pending against Cherry Lewis, 43, a postal worker from Johnsonville, and Keisha Lewis, 33, a postal worker from Hemingway.

McFadden was sentenced to more than three years in federal prison, which does not come with parole. The court also ordered McFadden to pay $2,191.257 in restitution to the U.S. Small Business Administration.

The U.S. Attorney's Office, District of South Carolina, did not immediately respond to a request for comment Friday.

How much COVID relief money was stolen through fraud?

More than $200 billion in COVID-19 relief loans and grants for small businesses may have been stolen by fraudsters, the Small Business Administration outlined in a report published in June.

The report found at least 17% of Economic Injury Disaster Loans and PPP loans were "disbursed to potentially fraudulent actors."

Cases of individuals committing fraud to secure COVID relief money have continued to surface in recent years.

In February, a California woman fled to Montenegro to try to avoid jail time after being convicted of helping steal $20 million in pandemic relief funds. Federal officials then had her extradited to the United States.

Last year, a Florida man pleaded guilty in a scheme that netted him $2.6 million, and ended up forfeiting a home, a boat, a 4.02-carat diamond and hundreds of rounds of ammunition.

Also last year, a Maine man pleaded guilty to obtaining a $59,145 loan for his company using false employee wage information and false supporting payroll documentation. The justice department said the man then spent the money on items and expenses he knew weren't covered by the program.

Contributing: Thao Nguyen, Orlando Mayorquin, Trevor Hughes, USA TODAY; Stacey Henson, Naples Daily News; Associated Press