Norfolk man charged with COVID-19 loan fraud

0

NEWPORT NEWS, Virginia – A federal grand jury released an indictment on Friday accusing a Norfolk man of submitting fraudulent disaster-related loan applications in connection with the COVID-19 outbreak that led to the disbursement of more than $ 190,000 in proceeds.

“The COVID-19 pandemic continues to affect our communities in countless ways,” said G. Zachary Terwilliger, United States Attorney for the Eastern District of Virginia. “The CARES Act provides emergency relief to help mitigate some of these effects. Fraud targeting CARES law benefits unfairly diverts these resources from the people and businesses who need them most. EDVA remains firmly committed to prosecuting those who seek to exploit this crisis for their personal gain.

From March 2020 to May 2020 at least, Joseph Cherry II, 39, allegedly engaged in a scheme to fraudulently obtain disaster loan benefits in the form of economic harm, according to the indictment sponsored by the Small Business Administration (SBA) of the United States. Disaster loans (EIDL) and a Paycheck Protection Program (PPP) loan. These SBA programs, initiated and expanded under the CARES Act, are designed to provide support to small businesses for expenses related to the COVID-19 outbreak.

“Providing false statements to access SBA programs will be aggressively investigated by our office,” said Hannibal “Mike” Ware, Inspector General of the US Small Business Administration. “SBA OIG and its law enforcement partners are on the verge of rooting out fraud in SBA programs and bringing wrongdoers to justice. I want to thank the United States Attorney’s Office and our law enforcement partners for their dedication and pursuit of justice. “

According to the indictment, Cherry, who was serving a federal supervised release sentence, allegedly submitted loan applications containing false statements and misrepresentation regarding his income, employment, claimed business entities and criminal record. The indictment alleges that Cherry fraudulently obtained proceeds in excess of $ 190,000 in April 2020. Additionally, within days, Cherry converted approximately $ 140,000 of that proceeds into cash or cashier checks.

“The immediacy with which the Deputy Marshals responded in making this arrest should send a clear message to those who intend to abuse the financial resources our government provides to those trying to recover from the ongoing pandemic. “said Nick E. Proffitt, United States Marshal for the Eastern District of Virginia. “The public should take comfort in knowing that even in this difficult COVID-19 environment, United States Deputy Marshals are on the job every day to help keep the community safe and that justice is served. “

Related: Virginia Coronavirus Fraud Task Force Warns Residents About Scams

Cherry is indicted in an indictment with 10 counts of wire fraud, theft of government property, misrepresentation to small business administration and money laundering. If found guilty, he faces the maximum penalties prescribed by law ranging from 10 to 30 years in prison for each count. The actual sentences for federal crimes are generally less than the maximum sentences. A federal district court judge will determine any sentence after taking into account US sentencing guidelines and other statutory factors.

“Unfortunately, in these uncertain times, individuals are fraudulently taking advantage of programs designed to help those in need,” said Kelly R. Jackson, the special agent in charge of IRS-CI. “We will prioritize the investigation of these blatant perpetrators and work with our law enforcement partners to bring these individuals to justice.” “

Authorities say this type of fraud reaches deep into the community by diverting vital funds meant to help struggling businesses survive and help people maintain their livelihoods. Anyone with information about the CARES Act and other COVID-19-related frauds is encouraged to submit a tip to the FBI at tips.fbi.gov.

If you believe you have been the victim of a scam or attempted fraud involving COVID-19, contact the National Center for Disaster Fraud hotline at 866-720-5721 or email catastrophe @ leo. gov. Members of the public in the Eastern District of Virginia are also encouraged to call 804-819-5416 or email [email protected] to contact their local Coronavirus Fraud Coordinator.

Click here for full coronavirus coverage.

Share.

About Author

Comments are closed.