Wheatland Man Admits $13.4M COVID Fraud Scheme

SACRAMENTO, Calif. – Jason Toland, 43, of Wheatland, California, confessed today to one count of submitting false claims against the United States in a brazen scheme to siphon over $13.4 million in COVID-19 pandemic relief funds. The guilty plea, announced by U.S. Attorney Phillip A. Talbert, reveals a calculated attempt to exploit programs designed to help legitimate businesses struggling during the pandemic.

Court documents detail how Toland allegedly used a network of shell companies – entities with no actual employees or business operations – to file fraudulent tax returns with the IRS. He targeted the Employee Retention Credit and the COVID Sick and Family Leave Credit, seeking over $11 million in refunds he wasn’t entitled to. Beyond the tax fraud, Toland also illicitly obtained more than $1.7 million in Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) funds between 2020 and 2023, further demonstrating the scope of his greed.

The scheme involved a barrage of falsified documents: Tax forms 941 and 941-X claiming erroneous refunds, fraudulent PPP loan applications submitted to various banks, and fabricated EIDL applications sent to the Small Business Administration (SBA). On November 18, 2022, alone, Toland filed two bogus Forms 941, resulting in $210,868 being improperly paid to him. These credits and loan programs were specifically intended to provide a lifeline to *real* businesses grappling with genuine financial hardship.

While Toland attempted to claim over $13.4 million, he successfully pocketed over $1.95 million before the scheme unraveled. Every penny of that stolen money was used for his personal enrichment, officials say. As part of the plea agreement, Toland has agreed to pay $1,952,504 in restitution, plus interest and fees, to the IRS and SBA – a small price to pay for attempting to defraud the system on such a massive scale.

“Tax credits are another face of pandemic fraud, and our COVID-19 Fraud Strike Force will continue to pursue those who abuse them,” stated U.S. Attorney Talbert. “The defendant’s false claims targeted credits meant for real businesses suffering real consequences of the pandemic.” IRS Criminal Investigation Acting Special Agent in Charge Michael Mosley added, “Crime does not pay. Our agents are experts at investigating financial crimes and following the money directly to criminals pursuing ill-gotten gains.”

The investigation, a collaborative effort between IRS Criminal Investigation (CI), the SBA Office of Inspector General, and the Federal Bureau of Investigation, is part of a larger California COVID-19 Fraud Enforcement Strike Force operation. Toland is scheduled to be sentenced by U.S. District Judge Dale A. Drozd on October 8, 2024. He faces a maximum of five years in prison and a $250,000 fine. The final sentence will be determined by the court, considering statutory factors and Federal Sentencing Guidelines.