Arizona Man Pled Guilty to 70 Fraudulent Loan Applications to $ 4 Million Electronic Coronavirus Fraud Scheme | USAO-CO

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DENVER – Michael Lane, 56, of Queen Creek, Arizona, pleaded guilty to electronic communications fraud today before US District Judge William J. Martinez. The verdict hearing is scheduled for December 3, 2021.

On March 27, 2020, the President of the United States signed into law the Coronavirus Relief, Assistance, and Economic Security Act (CARES), which provides for emergency assistance to small business owners administered by the US Small Business Administration (SBA). suffered from the coronavirus (COVID-19) pandemic. The two main sources of finance for small businesses were the Payroll Protection Program (PPP) and the Disaster Loan Program (EIDL).

Between March and June 2020, Defendant Michael Lane filed fake EIDL applications with the SBA on behalf of over 70 LLCs, seeking both loans and grants through the program. In these applications, Lane made false statements about the LLC’s number of employees, gross revenues, and the value of goods sold for the 12 months through January 30, 2020. He also falsely agreed to use the funds solely as working capital for the LLC. when he intended to use the funds for other purposes, including buying a new home. Seventy of his EIDL applications have been approved and funded by the SBA from its Denver financial center. Because of his false claims, Lain’s LLC received $ 3,830,400 in revenue from EIDL and $ 336,000 in revenue from the Economic Damage Grant (EIDG). As part of his plea agreement, Lane agreed to pay restitution as well as return the $ 294,900 he received from fraudulent PPP claims he also filed with the SBA.

“Anyone who uses lies and deceit to defraud the generosity of a US taxpayer can count on the US Attorney’s Office and its law enforcement partners on guard,” warned US Deputy Attorney J. Chris Larson. “Taxpayers want these funds to be used for their intended purpose – to rescue businesses badly affected by the pandemic, and not to stuff the pockets of criminals.”

“Today’s announcement should serve as a strong deterrent to anyone considering committing a COVID-19 fraud,” said Mark DellaSala, Special Agent in charge of the Secret Service Field Office in Denver. “Actions taken by the Secret Service, our financial partners and the US Attorney’s Office ensure that Small Business Administration loans in the event of natural disasters reach people whose livelihoods were affected during the global health crisis. The Secret Service is committed to protecting the financial infrastructure of the United States from individuals and organizations seeking to profit from taxpayer-funded incentives at the expense of America’s small businesses. ”

“Lying to gain access to economic stimulus funds for personal gain will be punished by justice,” said Weston King, Special Agent for the Western Region, SBA OIG. “SBA OIG will actively seek evidence of fraud in relation to SBA programs aimed at helping small businesses in the country grappling with the pandemic. I want to thank the US Attorney’s Office and our law enforcement partners for their dedication and commitment to justice. ”

The US Secret Service and the Inspector General’s Small Business Administration were investigating the case in connection with their work with the EIDL Anti-Fraud Task Force in Colorado. Assistant U.S. Attorneys Pegin Ryne and Patricia Davis are leading the prosecution.

CASE NUMBER: 21-cr-00175-WJM

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