Northwood Man Pleads Guilty to Fraudulently Attempting to Obtain Over $3.5 Million in CARES Act Funds
CONCORD – Joshua Leavitt, 40, of Northwood, New Hampshire, pleaded guilty in federal court to bank fraud and wire fraud, United States Attorney Jane E. Young announced today.
According to court documents and statements made in court, between March 2020 and November 2021, Leavitt and his co-defendant fraudulently applied for over two dozen loans under the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) programs. Congress had authorized the PPP and EIDL relief programs to help the millions of Americans and many small businesses adversely affected by the early stages of the COVID pandemic. PPP loans were issued by private lenders but fully guaranteed by the government, and EIDL funds were issued by the Small Business Administration.
For example, Leavitt and his co-defendant applied for and obtained a $175,000 PPP loan from TD Bank for one of their companies, Puro Group. The application claimed that Puro Group’s monthly payroll was $70,000 and that the company had six employees.
In connection with this application, Leavitt and his co-defendant submitted false supporting documents. One of those documents was a false IRS Form 941, or quarterly tax return, for the first quarter 2020. The document, which the defendants purportedly filed with the IRS, claimed that Puro Group had five employees that quarter who were paid a total of $209,999.99. The document also claimed that the defendants paid actual federal income tax of $27,600 that quarter. However, that document was never filed with the IRS. The real tax filings showed that Puro Group paid $48,255.53 to its employees during the entire calendar year of 2020, or approximately $4,000 per month.
As another example of the fraud, Leavitt and his co-defendant applied for, and obtained a $29,000 EIDL and $7,000 Economic Injury Disaster Grant for another of their companies, Monticello Transnational. They falsely claimed that Monticello Transnational’s gross revenues for the year preceding January 31, 2020, was $75,000 and that the company had seven employees. However, bank records showed no payments to employees and that the company had only a few thousand dollars’ worth of deposits. In addition, there were no tax filings for the company for 2019 or the first quarter of 2020.
In total, Leavitt and his co-defendant attempted to fraudulently obtain more than $3.5 million in PPP and EIDL funds. Leavitt will be required to pay restitution of $869,475.50.
Leavitt is scheduled to be sentenced on January 11, 2023.
Leavitt’s co-defendant has pleaded not guilty. The charges in the indictment are only allegations. He is presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The case was investigated by the Treasury Inspector General for Tax Administration and Secret Service, with assistance from the U.S. Postal Inspection Service. It is being prosecuted by Special Assistant U.S. Attorney Alexander S. Chen.