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Justice News

Department of Justice
U.S. Attorney’s Office
Middle District of Florida

FOR IMMEDIATE RELEASE
Wednesday, January 27, 2021

Dade City Man Admits Stealing And Laundering COVID Relief Funds

Tampa, Florida – Keith Nicoletta (48, Dade City) has pleaded guilty to a conspiracy to launder stolen COVID relief funds. He faces a maximum penalty of 20 years in federal prison. Nicoletta also agreed to forfeit more than $1.9 million, a 2020 Mercedes, a 2020 Ford F-250, real property located in Pasco County, and other funds and assets that are traceable proceeds of the offense.

According to the plea agreement, in May 2020, Nicoletta and his conspirators stole more than $1.9 million in emergency loan funds from the Paycheck Protection Program (“PPP”), which were guaranteed by the Small Business Administration. The fraudulent PPP loan application claimed that Nicoletta’s local business had 69 employees with a purported monthly payroll exceeding $760,000—or more than $9 million annually. In fact, the business had no employees and its address was actually Nicoletta’s home.

Once the emergency loan was secured, the PPP funds were not used for qualified expenses. Instead, the conspirators immediately began laundering the money through several different financial institutions. Nicoletta also withdrew more than $100,000 in cash. In October 2020, more than $40,000 in cash was recovered during a search of Nicoletta’s home. After laundering the PPP funds, Nicoletta spent lavishly, including the purchase of a 2020 Mercedes for more than $100,000, a 2020 special edition Ford F-250 pickup valued at more than $66,000, jewelry, and the installation of a pool at his home costing approximately $63,000. None of the money, however, was used for payroll, as Congress had intended.

The Coronavirus Aid, Relief, and Economic Security (“CARES”) Act is a federal law enacted March 2020. It is designed to provide emergency financial assistance to millions of Americans who are suffering the economic effects resulting from the COVID-19 pandemic. One source of relief provided by the CARES Act is the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses through the PPP. In April 2020, Congress authorized over $300 billion in additional PPP funding. The PPP allows qualifying small businesses and other organizations to receive loans with a maturity of two years and an interest rate of one percent. Businesses must use PPP loan proceeds for payroll costs, interest on mortgages, rent, and utilities. The PPP allows the interest and principal to be forgiven if the business spends the proceeds on these expenses within a set time period and uses at least a certain percentage of the loan toward payroll expenses.

This case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service – Criminal Investigation, Tampa Field Office. It is being prosecuted by Assistant United States Attorneys Kristen A. Fiore and Suzanne Nebesky.

Topic(s): 
Coronavirus
Disaster Fraud
Financial Fraud
Component(s): 
Updated January 28, 2021