Florida businessman Patrick Walsh and 10 companies he operated have agreed to a $20 million consent judgment to resolve allegations of fraud tied to federal COVID-19 relief programs. Authorities accused Walsh of submitting false Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) applications, securing approximately $7.8 million through misleading claims.
Fraudulent Loan Applications and Misuse of Funds
Walsh admitted to falsifying employee rosters and payroll information when applying for federal loans. Some companies listed in the applications were inactive. Additionally, he submitted fraudulent EIDL applications using his wife’s name. Instead of supporting business operations, Walsh spent the funds on personal luxuries, including purchasing a private island, investing in Texas oil interests, and paying off personal debts.
Government Response and Legal Consequences
When Walsh defaulted, the Small Business Administration (SBA) paid lenders under its loan guarantees, covering principal, interest, and processing fees. As part of the settlement, Walsh and his companies are responsible for repaying $20,074,458.70.
In January 2023, Walsh pleaded guilty to one count of wire fraud and one count of money laundering. A federal court sentenced him to 66 months in prison and ordered $7.8 million in restitution. He is currently serving his sentence.
Whistleblower Lawsuit and Accountability Efforts
The case originated from a whistleblower complaint filed under the False Claims Act by Andrew Hersh, an IT specialist who worked with Walsh. The law allows private individuals to sue on behalf of the government and receive a share of the recovered funds. The exact amount Hersh will receive remains undetermined.
Federal officials stressed their commitment to holding fraudsters accountable. Acting Assistant Attorney General Yaakov M. Roth stated that relief programs were designed to help struggling businesses, not to enrich dishonest applicants. Acting U.S. Attorney Michelle Spaven added that Walsh’s sentence and financial penalties should serve as a deterrent. SBA General Counsel Wendell Davis echoed this sentiment, emphasizing the agency’s dedication to protecting taxpayer money.
Coordinated Investigation and Conclusion
The resolution resulted from a joint effort by the Justice Department, the SBA, and the U.S. Attorney’s Office for the Northern District of Florida. Investigators and prosecutors worked together to recover stolen funds and penalize fraudulent activity. This case highlights the government’s ongoing efforts to combat fraud in pandemic relief programs.
The allegations resolved in this settlement remain claims, except for the admissions made in Walsh’s guilty plea. The government continues to pursue similar cases, reinforcing its stance against financial misconduct.
Ten years of experience reporting. From car chases and courtroom verdicts to House fires, Holsford thrives during breaking news and finds it a privilege to help drive the conversation in Rockland County and the Greater New York Area. Born in San Bernardino, Thomas is a New York boy at heart. He received his bachelor’s degree in broadcast journalism, specializing in political science and sociology, from the University of Illinois
