An Illinois tax preparer was sentenced to prison after federal prosecutors say he orchestrated a sweeping fraud that siphoned off millions from pandemic relief programs, sent funds abroad, and used proceeds to upgrade his lifestyle. The case involves more than 1,500 fraudulent Paycheck Protection Program applications and tens of millions in government payouts tied to the CARES Act. Officials say the scheme produced kickbacks, overseas transfers, and personal spending that led to a decade-long prison term and heavy financial penalties.
Federal authorities say the defendant, identified as Sharhabeel Shreiteh, submitted over 1,500 bogus PPP loan applications in 2020 and 2021, causing the government to disburse at least $14 million in fraudulent loans. Prosecutors allege he solicited personal identifying information from supposed sole proprietors, self-employed people, and small businesses, then inflated payroll, income, and expenses on applications. For each approved loan, he reportedly collected kickbacks generally between $1,000 and $4,000.
Shreiteh worked as a tax preparer in Palos Hills, Illinois, and federal court records say he turned the pandemic relief program into a profit center for himself. Authorities say he also laundered hundreds of thousands of dollars to financial institutions in the Palestinian Territories, and used fraud proceeds to build a second home overseas. Back home, those funds are accused of financing renovations to his Crete, Illinois residence and paid for vacations to destinations like South Carolina and Florida.
Last year Shreiteh pleaded guilty to a federal wire fraud charge tied to the scheme, and on March 10, 2026, U.S. District Judge Martha M. Pacold imposed a prison sentence of ten years. The court ordered forfeiture of $741,000 and restitution of $14 million to the United States government. The financial penalties reflect both the alleged kickbacks he received and the broader loss the government attributes to the scheme.
During sentencing Judge Pacold criticized the theft of emergency funds meant for struggling businesses and workers. “Any fraud against any government program, but in particular a program that was an emergency relief program, to take advantage of those emergency funds and ultimately to steal from taxpayers is a terrible thing, and it’s a very serious offense.” She called the diversion of those funds overseas especially aggravating and warned such frauds undermine future relief efforts.
The judge also pointed to evidence prosecutors presented that Shreiteh collected unemployment benefits from both Illinois and Ohio while receiving PPP proceeds and continuing to work as a tax preparer. “That just shows a general disregard for the law, and . . . [a] willingness to lie to get money from government programs,” Judge Pacold said. That pattern of conduct was among the factors federal officials cited when pushing for a stiff sentence.
U.S. Attorney Boutros announced the sentence alongside officials from IRS Criminal Investigation and the FBI, underscoring the multiagency effort on pandemic-relief fraud. Adam Jobes, Special Agent-in-Charge of IRS Criminal Investigation in Chicago, and Douglas S. DePodesta, Special Agent-in-Charge of the FBI Chicago Field Office, were named in the announcement. The coordinated investigation tracked the flow of funds, the false paperwork, and the alleged kickback arrangements tied to the fraud.
In the government’s sentencing filing, Assistant U.S. Attorney Elie Zenner framed the scheme as an opportunistic attack on a national safety net during crisis. “In America’s time of need, the defendant saw a chance to upgrade his lifestyle,” Assistant U.S. Attorney Elie Zenner argued in the government’s sentencing memorandum. Zenner added that the alleged fraud caused a massive loss to federal resources at a moment when legitimate businesses desperately needed payroll support.
Investigators say the case illustrates vulnerabilities that can appear in rapid-response relief programs, especially when documents and applications are submitted in high volume. Prosecutors emphasize that emergency funding is taxpayer-funded and meant for people who were suffering the economic impact of the pandemic. Anyone with information about suspected COVID-19 fraud can contact the National Center for Disaster Fraud by calling (866) 720-5721, or by submitting an online complaint through the Department of Justice.
