Former Banker Sentenced to Jail for Participating in Film Funding Fraud for False Claiming COVID-19 Loan | USAO-SDFL

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Miami, Florida. The former South Florida banker was sentenced this week to 42 months in prison for his involvement in two scams: first, a scheme to steal more than $ 60 million from investors and producers seeking funding for films and Broadway shows; the second is hiding one’s criminal history when applying for a loan from COVID-19.

Benjamin Raphael, 31, of South Florida, has previously admitted his role in legitimizing a sophisticated film finance fraud scheme. Raphael pleaded guilty to one count of conspiracy to commit electronic fraud in violation of Title 18, United States Code, Section 1349 (Case # 19-CR-20447).

According to the court records, Rafael’s co-defendants, Benjamin McConley and Jason Van Eman, declared themselves as film producers and financiers. In these roles, McConley and Van Eeman allegedly offered to provide funding to investors and producers looking for funds to produce films, theatrical performances and other projects. In the indictment, McConley and Van Eman promised victims that, in exchange for the victims’ monetary contributions, McConley would “match” the contributions and use the pooled funds to secure funding from financial institutions in South Florida and elsewhere.

To implement this scheme, McConley and Van Eman are said to have hired Raphael, then a bank employee, to trick victims into the safety of their funds. During the scheme, McConley and Van Eman repeatedly ordered Raphael to falsely reassure victims that their contributions or loans were “in line” as promised in the funding agreements, court documents say.

According to the indictment, the victims sent tens of millions of dollars to accounts controlled by the defendants based on these false statements and promises. In truth, the intrigue never “matched” the victims’ contributions as promised in the funding agreements. Instead, according to court documents, they stole the victims’ money by transferring funds to their personal and corporate bank accounts, often within days of the victims making contributions or loans.

After being indicted and pleading guilty in case # 19-CR-20447, Rafael submitted several applications to various banks for the Payroll Protection Program (PPP) and Disaster Injury Loan (EIDL). In these statements, he concealed the fact that he had previously pleaded guilty in case No. 19-CR-20447.

As a result of these fraudulent statements by PPP and EIDL, Raphael was charged with providing false information to a financial institution in violation of Title 18, USC, Section 1014 (Case # 21-CR-20161). Raphael pleaded guilty to PPP fraud earlier this week. At the same court appearance, Rafael was sentenced for his conduct in both cases in a single trial.

In addition to a combined 42-month prison sentence, Rafael was ordered to pay compensation to victims, confiscate money and property associated with the fraudulent schemes, and serve a five-year supervisory release.

Co-defendant Benjamin McConley has previously pleaded guilty in case # 19-CR-20447 to one count of conspiracy to commit electronic fraud, and his sentence is due on September 14, 2021 at 9:00 am by District Judge Raag Singhal. The trial of the accused Jason Van Eman is set for August 30, 2021.

Juan Antonio Gonzalez, Acting U.S. Attorney for the Southern District of Florida, Responsible Special Agent George L. Piro of the FBI Field Office in Miami, and Responsible Special Agent Amaleka McCall-Brathwaite of the U.S. Small Business Administration, Office of the Inspector General (SBA-OIG), Division Regional Office Investigations, made the announcement.

The Miami FBI and SBA-OIG have investigated the matter. The 2019 case is being led by Assistant U.S. Attorneys Christopher Brown and Elizabeth Young. The 2021 case was handled by Assistant U.S. Attorney Lacey Monk. Assistant U.S. Attorney Marks Calderon is responsible for the asset forfeiture component in both cases.

The CARES Act is a federal law passed on March 29, 2020 with the aim of providing emergency financial assistance to millions of Americans suffering from the economic fallout from the COVID-19 pandemic. One source of relief provided by the CARES Act was allowing hundreds of billions of dollars in voucher loans to small businesses to save jobs and certain other expenses through PPPs.

PPP allows qualified small businesses and other organizations to obtain loans with a maturity of two years and an interest rate of 1%. Proceeds from PPP loans are to be used by businesses to cover wages, mortgage interest, rents and utilities. PPP allows you to write off interest and principal on a PPP loan if the business spends the funds on the loan on these expense items within a specified period of time after receiving the proceeds and uses at least a specified percentage of the proceeds from the PPP loan to payroll expenses. …

The EIDL program is designed to provide economic assistance to small businesses that are currently experiencing temporary loss of income. EIDL proceeds can be used to cover a wide range of working capital and common operating expenses such as continuing health benefits, rent, utilities, and debt fixed payments. If the applicant also receives a PPP loan, the EIDL funds cannot be used for the same purpose as the PPP funds.

On May 17, 2021, the Attorney General established the COVID-19 Fraud Task Force to mobilize the resources of the Department of Justice, in partnership with government departments, to intensify efforts to combat and prevent pandemic-related fraud. The Task Force supports efforts to investigate and prosecute the most culpable domestic and international criminal actors, and helps agencies tasked with managing assistance programs to prevent fraud, inter alia, by expanding and incorporating existing coordination mechanisms, identifying resources and methods to identify fraudsters and fraudsters. schemes, and the exchange and use of information and ideas from previous compliance efforts. For more information on the Department’s response to the pandemic, visit https://www.justice.gov/coronavirus

Anyone with information on allegations of attempted COVID-19 fraud can report this by calling the National Center for Disaster Management of Disaster Fraud (NCDF) of the U.S. Department of Justice at 866-720-5721 or via the NCDF complaint web form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form

A copy of this press release can be found on the website of the U.S. Attorney’s Office for the Southern District of Florida at: www.usdoj.gov/usao/fla

Relevant court documents and information can be found on the website of the District Court for the Southern District of Florida at: www.flsd.uscourts.gov or at http://pacer.flsd.uscourts.gov

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