Two Individuals Sentenced for COVID-19 Relief Fraud
Miami, Florida – A Georgia man was sentenced today to 18 months in federal prison for fraudulently obtaining $285,742 through a Paycheck Protection Program (PPP) loan guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security (CARES) Act.
Dennes Garcia, 28, of Atlanta, pleaded guilty in the Southern District of Florida to conspiracy to commit wire fraud on July 6. According to court documents, Garcia admitted to obtaining a PPP loan of $285,742 for his own company, Dhanda Corporation, based on false information about the company’s number of employees and average payroll and based on false supporting tax documents. Garcia also admitted that he wrote himself a check for $100,000 using the PPP loan proceeds, and further admitted that he paid $71,435.50 to an alleged co-conspirator, James Stote, as a kickback for his assistance in preparing and submitting the fraudulent loan application. In addition to his prison sentence, Garcia was ordered to pay $285,742 in restitution and $285,742 in forfeiture.
Relatedly, Cindi Denton, 63, of Eastvale, California, was sentenced on Oct. 8 to six months in prison and 12 months of home confinement after pleading guilty in the Southern District of Florida to conspiracy to commit wire fraud on July 22. According to court documents, Denton admitted to obtaining a PPP loan of $491,310 for her own company, Emerald Jade Solutions Inc., based on false information about the company’s number of employees and average payroll and based on false supporting tax documents. Denton also admitted that she sent a $150,000 wire to her personal checking account using the PPP loan proceeds, and further admitted that she paid $98,262 to alleged co-conspirator Stote as a kickback for his assistance in preparing and submitting the fraudulent PPP loan application. In addition to her prison sentence, Denton was ordered to serve three years of supervised release, and to pay $377,883.91 in restitution and $377,883.91 in forfeiture.
Stote was charged by complaint on June 24, 2020, with wire fraud, bank fraud, and conspiracy to commit wire fraud, and his case remains pending.
Acting U.S. Attorney Juan Antonio Gonzalez of the Southern District of Florida; Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division; Special Agent in Charge Michael J. De Palma of the IRS-Criminal Investigation (IRS-CI) Miami Field Office; Special Agent in Charge George L. Piro of the FBI’s Miami Field Office; and Special Agent in Charge Amaleka McCall-Brathwaite of the SBA’s Office of Inspector General (SBA-OIG) Eastern Region made the announcement.
The IRS-CI, FBI, and SBA-OIG investigated the case.
Assistant U.S. Attorney Lindsey Lazopoulos Friedman and of the Southern District of Florida and Trial Attorney Philip Trout of the Criminal Division’s Fraud Section prosecuted the case.
The Fraud Section leads the department’s prosecution of fraud schemes that exploit the PPP. Since the PPP began, Fraud Section attorneys have prosecuted more than 100 defendants in more than 70 criminal cases. The Fraud Section has also seized more than $65 million in cash proceeds derived from fraudulently obtained PPP funds, as well as numerous real estate properties and luxury items purchased with such proceeds. More information can be found at https://www.justice.gov/criminal-fraud/ppp-fraud.
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.
A complaint is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.