Spokane Man Sentenced to 5 Years Probation for Operating a Ponzi Scheme and Defrauding Investors of More Than $3 Million
Spokane, Washington – Vanessa R. Waldref, the United States Attorney for the Eastern District of Washington, announced today that Jason Carnell O’Daffer, formerly of Wenatchee, Washington, pled guilty to fraudulently obtaining more than $117,000 in COVID relief funding. United States District Judge Thomas O. Rice accepted O’Daffer’s guilty plea, and set sentencing for May 8, 2024, at 10:30 a.m., in Spokane.
On March 27, 2020, the President signed into law the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The CARES Act provided a number of programs through which eligible small businesses could request and obtain relief funding intended to mitigate the economic impacts of the pandemic for small and local businesses. One such program, the Paycheck Protection Program (PPP), provided forgivable loans to eligible small businesses to retain jobs and maintain payroll during the pandemic. Another program, the Economic Injury Disaster Loan (EIDL) program, provided low-interest bridge funding for small businesses placed at risk during the pandemic.
In February 2022, U.S. Attorney Waldref and the U.S. Attorney’s Office began working with federal law enforcement agencies to create and launch a COVID-19 Fraud Strike Force that would leverage partnerships between different agencies to aggressively investigate and prosecute fraud against COVID-19 relief programs in Eastern Washington. The Strike Force consists of agency representatives from the U.S. Attorney’s Office, Small Business Administration (SBA) Office of Inspector General (OIG), Federal Bureau of Investigation (FBI), U.S. Department of the Treasury Inspector General for Tax Administration (TIGTA), U.S. Secret Service, U.S. Homeland Security Investigations (HSI), U.S. Department of Veterans Affairs OIG, General Services Administration OIG, Internal Revenue Service, Department of Energy OIG, Department of Homeland Security OIG, and others. Cases investigated and prosecuted by the Strike Force have resulted in numerous indictments, criminal prosecutions, convictions, and civil penalties.
In the plea agreement accepted by the court, and in information disclosed during court proceedings, O’Daffer admitted to fraudulently obtaining $117,400 in EIDL funding for his purported home appraisal business, Chelan Douglas Appraisal Services. When O’Daffer submitted his EIDL application, he was not licensed as an appraiser, and his business was no longer engaging in home appraisals. Rather, O’Daffer spent the loan proceeds on non-business expenses including more than $39,000 for the purchase of a personal RV.
“We created the Eastern Washington COVID-19 Fraud Strike Force because combatting pandemic-related fraud and holding those accountable who abused these programs is critical to protecting our small and local businesses, and the critical jobs and services that these businesses provide for the community,” stated U.S. Attorney Waldref. “I commend the superb investigative work performed on these cases by the Strike Force and especially in this case by SBA OIG and the Secret Service. My office’s White Collar team will continue to vigorously prosecute those who abuse and misuse COVID-19 funding.”
“This investigation serves as a reminder to those who would prey on government programs, meant to help individuals in need, that they will be identified and held accountable,” said Greg Ligouri, Resident Agent in Charge of the Secret Service’s Spokane Office. “The Secret Service sincerely appreciates the U.S. Attorney’s Office, SBA and its other federal and local law enforcement partners for the collaborative effort in investigating and prosecuting these types of financial crimes.”
This case was investigated by the Eastern District of Washington COVID-19 Fraud Strike Force, the U.S. Secret Service, Spokane Resident Office and San Francisco Field Office, and the SBA OIG. Assistant United States Attorney Jeremy Kelly, and Assistant United States Attorney Tyler H.L. Tornabene are prosecuting this case on behalf of the United States.
A video statement from U.S. Attorney Waldref, about the Eastern Washington COVID-19 Strike Force, can be viewed here.
Public Affairs Specialist