Illinois businessman charged with fraud over $6.3 million PPP loan scheme during COVID pandemic
CHICAGO (CBS) -- An Addison businessman has been indicted on fraud and money laundering charges, accused of scheming with a California man to fraudulently obtain more than $6.3 million in COVID pandemic-era federal loans.
Francesco Distefano, 28, has been charged with 11 counts of wire fraud, five counts of money laundering, and one count of knowingly making a false statement to a bank.
Sargis Urumieh, 57, of Glendale, Calif., has been charged with eight counts of wire fraud.
Federal prosecutors said the two falsified loan applications to obtain Paycheck Protection Program (PPP) and Economic Injury Disaster Loan Program (EIDL) loans for Distefano's company, Distefano Enterprises LLC, and two companies where Urumieh served as a corporate officer. The applications misrepresented the companies' operations, including how many people they employed, their gross revenues, and payroll costs.
In total, the pair obtained four PPP loans of approximately $1.1 million, $1.4 million, $1.7 million, and $2 million, and an EIDL loan of approximately $160,000.
According to the charges, Distefano used the money from the loans to buy luxury cars – including a Lamborghini Huracan, Maserati Ghibli, and Porsche 911. Distefano and Urumieh also allegedly used money from the loans and a fraudulent mortgage application to obtain a $765,000 loan to buy a home in California.
Arraignment hearings for the two men have not yet been scheduled. If convicted, they face up to 20 years in prison for each count of wire fraud and money laundering, and up to 30 years for the false statement count.