Indictments Allege that Defendants Collectively Received More Than $800,000 in Fraudulently-Obtained COVID-19 Relief Funding, Seek Forfeiture of West Richland Residence Purchased with Fraudulently-Obtained Funds
Richland, Washington – Today, Vanessa R. Waldref, the United States Attorney for the Eastern District of Washington, announced that a federal grand jury has indicted two additional individuals for COVID-19 Fraud as part of the Eastern Washington COVID-19 Strike Force. The Indictments announced today are the most recent charges brought by the Strike Force, which has brought criminal charges against numerous individuals and recovered millions of dollars in fraudulently obtained COVID relief funding.
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 government-backed loans to small businesses which could be forgiven so long as the proceeds were used for payroll and other eligible expenses. Another program, the Economic Injury Disaster Loan (EIDL) program, provided low interest loans that could be deferred until the conclusion of the pandemic to provide “bridge” funding for small businesses to maintain their operations during shutdowns and other economic circumstances caused by the pandemic. The PPP and EIDL programs have provided billions of dollars in aid, the vast majority of which have not been paid back, including hundreds of millions of dollars disbursed within Eastern Washington.
One indictment announced today charges Jimia Rae Cain, age 52, of West Richland, Washington, with seven counts of fraud in connection with PPP and EIDL loans that she obtained in 2020. The Indictment alleges that Cain used false statements and fraudulent documents to obtain more than $330,000 in CARES Act funding for her purported business. The Indictment further alleges that Cain attempted to secure an additional $280,000 in EIDL funding, but this additional funding was declined.
The second Indictment announced today charges Andrei Borgheriu, age 45, of West Richland, Washington, with three counts of fraud in connection with $500,000 in EIDL funding that he obtained on behalf of his company Artway Transport, LLC. The Indictment alleges that Borgheriu falsely represented that the funding would be used as working capital for his company, but instead that Borgheriu used it for an all-cash purchase of a personal residence in West Richland, Washington. The Indictment alleges that, soon after receiving the EIDL funding, Borgheriu wired nearly all of the EIDL funding to the title company for the purchase of the personal residence. As set forth in the Indictment, the United States therefore also seeks forfeiture of the residence based on allegations that it represents proceeds from the fraudulently obtained EIDL funding.
“COVID-19 relief programs were designed to lift up our community during crisis, and due to the number of people and businesses that requested funding, some deserving small businesses were not able to obtain funding to keep their businesses in operation,” said U.S. Attorney Waldref. “We created the Strike Force in order to ensure that those who misused COVID-19 relief funding are held accountable and to protect the strength and safety of our vital small business community.”
In February 2022, U.S. Attorney Waldref and the U.S. Attorney’s Office (USAO) 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 USAO, 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, U.S. Department of Veterans Affairs OIG, General Services Administration OIG, Department of Homeland Security (DHS) OIG, Internal Revenue Service, Department of Energy OIG, and others.
“I commend the continuing investigative work performed to date by the Strike Force, including by SBA OIG, FBI, and TIGTA,” said U.S. Attorney Waldref. “As the Strike Force’s work moves forward, we will continue taking aggressive action to pursue property that was purchased with fraudulently-obtained funds, to ensure that those funds are returned to the public and that wrongdoers are not able to reap the benefit of homes and other property purchased with fraudulently-obtained funds. We also will continue to work together with our law enforcement partners to vigorously prosecute those who abuse and misuse COVID-19 relief funding, and to strengthen our communities by protecting our small and local businesses.”
The fraud charges against Cain carry a maximum sentence of up to 30 years in federal prison, while the fraud charges against Borgheriu carry a maximum sentence of up to 20 years. This case was investigated by the Eastern District of Washington COVID-19 Fraud Strike Force and by the FBI, SBA OIG, and TIGTA. The United States Attorney also thanks the West Richland Police Department for graciously providing critical support and assistance. The cases are being prosecuted by Assistant United States Attorneys Dan Fruchter, Frieda K. Zimmerman, Tyler H.L. Tornabene, and Brian Donovan.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.