A 49-year-old man from Venice, California, has pleaded guilty to wire fraud charges related to multiple programs under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The individual, who owned a purported business, admitted to defrauding the Paycheck Protection Program (PPP) and the Main Street Lending Program (MSLP) out of more than $10 million.
The defendant falsely represented his company as a legitimate computer hardware retailer and storage provider, submitting fraudulent loan applications in 2020. Court documents reveal that he exaggerated the company’s sales and claimed to employ up to 17 individuals, despite having no employees or legitimate revenue. To back his fraudulent applications, he submitted falsified tax returns, payroll records, and financial statements to various banks.
Moreover, the man confessed to orchestrating a long-standing scheme targeting commercial equipment lenders. He directed business owners to apply for loans to purchase computer equipment, using forged invoices from his company. After lenders approved these loans, he and his associates misappropriated a portion of the funds while giving the majority to the borrowers, without delivering the equipment promised in the invoices. This fraudulent operation resulted in over $60 million in illicit lending spread across more than 350 loans.
Sentencing for the individual is set for December 12, 2024, where he faces a maximum of 20 years in federal prison. The final sentence will be determined by a federal district court judge, who will take into account the U.S. Sentencing Guidelines and other relevant factors.
This case highlights the ongoing efforts to combat fraud related to pandemic relief programs, as authorities continue to investigate and prosecute those who exploit these crucial resources.
