NJ man pleads guilty to depositing and altering stolen Treasury check and PPP fraud amounting to nearly $700k

A man from MIddlesex, N.J., last week admitted he deposited a stolen and altered U.S. Treasury check for more than $211,000 and fraudulently received more than $481,000 from the Paycheck Protection Program (PPP) created to ease the hardships on businesses and employees of the COVID-19 pandemic, according to a federal agency release Tuesday.

Bernard Lopez, 40, pleaded guilty by videoconference April 21 before a U.S. district judge to an information charging him with one count each of bank fraud and theft of government funds, according to the Federal Deposit Insurance Corp. (FDIC) Office of Inspector General (OIG), which assisted other federal agencies in investigating this case.

According to the documents filed in this case and statements made in court, the agency said, Lopez devised a scheme to commit bank fraud through which a stolen and altered U.S. Treasury check was deposited into a corporate bank account Lopez created in the name of Pezlo Management LLC. The check was altered to be made payable to Pezlo in the amount of $211,886 and was then deposited into Pezlo’s corporate bank account. Lopez later withdrew or transferred the stolen proceeds from the account before the bank could detect the fraud, the agency said.

It also said that on June 24, 2020, Lopez “caused to be submitted” a fraudulent PPP loan application to a lender on behalf of Company-1, a purported business that Lopez controlled. Lopez’s PPP application falsely represented that Company-1 employed 25 employees, had a monthly payroll expense of approximately $192,000, and had mortgage/lease and utilities expenses. The company in fact employed no one and had no payroll or utility expenses, the agency said. Based on Lopez’s misrepresentations, the lender approved Lopez’s PPP loan application and provided Lopez’s purported business with $481,502 in federal COVID-19 emergency relief funds meant for distressed small businesses; Lopez then converted a portion of the proceeds for his own use.

The PPP, administered by the Small Business Administration, is designed to provide forgivable loans to small businesses affected by the coronavirus pandemic. PPP loans may be entirely forgiven if the recipient spends the loan proceeds on permissible expenses within a designated period after receiving the proceeds.

The FDIC OIG said the count of bank fraud is punishable by a maximum penalty of 30 years in prison and a $1 million fine, or twice the gross gain to the defendant or gross loss to the victim, whichever is greater. The count of theft of government funds is punishable by a maximum of 10 years in prison and a fine of up to $250,000, or twice the gross gain or loss from the offense, whichever is greater.

Middlesex Man Admits Paycheck Protection Program Fraud Scheme and Obtaining Funds from a Deposited Stolen and Altered U.S. Treasury Check

Be the first to comment

Leave a Reply

Your email address will not be published.