Salem Man Pleads Guilty to Small Business Loan Fraud and Filing Fraudulent Tax Returns
BOSTON – A Salem man pleaded guilty today in federal court in Boston in connection with two fraud schemes involving COVID-19 relief funds and tax returns for other individuals.
Roosevelt Fernandez, 42, pleaded guilty to two counts of wire fraud and one count of aggravated identity theft. U.S. District Court Judge Richard Stearns scheduled sentencing for May 11, 2022. Fernandez was charged in December 2020.
Fernandez applied for 10 Economic Injury Disaster Loans (EIDL) from the U.S. Small Business Administration (SBA), either in his own name or in the names of entities he controlled. EIDL funds were available to eligible individuals and businesses pursuant to the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). In June 2020, Fernandez applied for an EIDL under the name Soluciones Multi Service, an entity he controlled, and submitted a false tax filing in support of the application. As a result, the SBA deposited $124,900 into a bank account controlled by Fernandez from which he withdrew more than $80,000 in cash over the next two weeks. In August 2020, Fernandez applied for an EIDL in the name of another business using fraudulent tax filing information. As a result, the SBA deposited $149,900 into the same bank account.
In addition, Fernandez used the identities of various individuals to submit fraudulent state and federal tax returns. A number of these returns included fraudulent W-2 Forms purportedly issued by employers for whom the named taxpayer did not in fact work. Various fraudulent refunds were deposited into an account in the name of Soluciones Multi Service. In addition, a May 2020 fraudulent Economic Income Payment – stimulus authorized by CARES Act – was deposited into this same account. Fernandez was depicted on ATM surveillance footage depositing another fraudulent tax refund check into this account. Overall, the investigation uncovered approximately 40 fraudulent tax returns associated with Fernandez, totaling over $620,000 in requested refunds.
The charges of wire fraud provide for a sentence of up to 20 years in prison, up to three years of supervised release and a fine of up to $250,000. The charge of aggravated identity theft provides for a mandatory sentence of two years in prison, up to one year of supervised release and a fine of up to $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
Acting United States Attorney Nathaniel R. Mendell and Joleen D. Simpson, Special Agent in Charge of the Internal Revenue Service-Criminal Investigation Division for the Boston Field Office, made the announcement today. The U.S. Postal Inspection Service and the Massachusetts Department of Revenue provided valuable assistance with the investigation. Assistant U.S. Attorney Bill Abely, Chief of Mendell’s Criminal Division, is prosecuting the case.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.