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Nearly three years after criminals first set their sights on the government’s generous coronavirus aid programs, President Biden today called on Congress to approve $1.6 billion to combat fraud, hoping to empower federal prosecutors and prevent such historic theft from targeting taxpayer money again, the Washington Post reported. The new request for funds foreshadows the years of costly and complicated work now ahead of Washington, after malicious actors set their sights on the more than $5 trillion that lawmakers intended for workers, families and businesses amid the worst economic crisis since the Great Depression. But the push from the White House could still face familiar political obstacles on Capitol Hill. Seeking to punish criminals and secure new savings at a moment of rising deficits, lawmakers long have expressed alarm about the vast sums stolen during the pandemic — yet they have done little to address the root causes of the problem. Beginning in March 2020, Democrats and Republicans banded together to adopt a series of laws that injected trillions of dollars into the economy. The unprecedented aid provided extra weekly checks to unemployed workers; offered easy, forgivable loans to cash-starved businesses; and guaranteed urgently needed money for hospitals, schools and local governments under immense financial strain.

Toronto-Dominion Bank on Friday agreed to pay $1.2 billion to settle claims stemming from the Canadian bank’s involvement in the Ponzi scheme perpetrated by convicted swindler R. Allen Stanford, resolving nearly all outstanding litigation related to the fraud, WSJ Pro Bankruptcy reported. Michigan-based Independent Bank and London-based HSBC Holdings PLC also reached settlements on Friday, following deals struck last month by Société Générale SA of Paris and Trustmark National Bank of Jackson, Miss. The deals reached this year totaled more than $1.6 billion, pending court approval, according to lawyers representing the court-appointed receiver in the case. The receiver also recouped more than $1.1 billion through previous litigation, bringing the total amount of potential recoveries to more than $2.7 billion, proceeds that will go toward making restitution to victims of the fraud. Stanford Financial Group, now defunct, was a financial-services company that operated until it was seized by U.S. authorities in early 2009. Its former chairman, Mr. Stanford, was convicted in 2012 of running a two-decade investment-fraud scheme amounting to $7 billion, one of the largest frauds in U.S. history. He was sentenced to 110 years in prison.

Ivelisse Rivera-Padilla and Carla Carrillo-Torres, and the company VIP Healthcare Solutions, Inc. (“VIP Healthcare”) were indicted by a federal Grand Jury in relation to bankruptcy fraud, a money laundering scheme, PPP fraud, and bank fraud announced W. Stephen Muldrow, U.S. Attorney for the District of Puerto Rico, according to a DOJ press release. Ivelisse Rivera-Padilla, the President of VIP Healthcare, was indicted in a bankruptcy fraud scheme for making materially false representations from March 2017 to May 2022 in order to defraud during her bankruptcy proceeding, In re: Ivelisse Rivera Padilla, Case No. 17-01782, all in violation of 18 U.S.C. § 157. Additionally, she is charged with 10 counts of concealment of assets during her bankruptcy proceedings in violation of 18 U.S.C. § 152(1), and 3 counts of making false statements in relation to such bankruptcy proceedings, in violation of 18 U.S.C. § 152(3). The indictment alleges that during the bankruptcy proceedings, Ivelisse Rivera-Padilla concealed property and income and failed to disclose to the trustee charged with control of the debtor’s property and from the creditors and the U.S. Trustee all of the bankruptcy estate during the course of her bankruptcy proceedings, including, but not limited to the creation, operation, ownership, and control of VIP Healthcare.

Based on the “natural breadth of the passive voice” used in Section 523(a)(2)(A), the Supreme Court held yesterday in a unanimous opinion by Justice Amy Coney Barrett that a partner who herself was innocent of fraud is nonetheless saddled with a nondischargeable debt resulting from the fraud of her partner. The opinion is a reaffirmation of the Court’s holding in Strang v. Bradner, 114 U.S. 555 (1885). In a concurring opinion, Justices Sonia Sotomayor and Ketanji Brown Jackson endeavored to limit the scope of the holding by saying that they understood the outcome to be based on the existence of a partnership under state law. Read the full column.

Victims lost more than $500 million on just one of the three blockchains targeted by scammers, according to a new analysis that digital asset intelligence company Inca Digital provided to the Washington Post. Ian Schade, a blockchain intelligence analyst at TRM Labs, said the full cost of the scams has probably reached into the billions over each of the last two years. The scam strategy has a name — “pig-butchering,” referring to winning people’s trust with quick initial gains that scammers then use to lure bigger investments, fattening them up like pigs before the slaughter. The fraudsters meet potential targets on dating apps or other platforms, most recently including Airbnb. And perpetrators are making off with more than even most law enforcement officials realize. Even as the crypto world endures a year-long slump exacerbated by the implosion of the trading exchange FTX and other high-profile firms, scammers have continued to snag new victims and rake in eye-popping hauls, the data show. Inca Digital analyzed a portion of the fraud, gathering data from eight leading exchanges that scammers use to lure their quarry and assessing only a slice of the crypto they target.