A Southern California man has been sentenced to prison for fraudulent governments over $6.9 million through a scheme targeting small business loans during the Covid-19 pandemic.
The man was identified as Abraham Park, 67, of La Mirada, according to the US Law Office.
His scheme scams Small Business Management (SBA) out of millions of dollars in loans through the Economic Injury Disaster Loans (EIDL) program.
According to court documents, the crime occurred from March 2020 to October 2022. Park was the owner of a financial services company that helped clients repair their credit scores and obtain funding, including loans.
When the pandemic began, Park told its clients to create fake corporate entities, allowing them to submit fraudulent EIDL loan applications on behalf of the SBA.
In return, his client will pay him a portion of the loan he received as a kickback, prosecutors said. Park also filed false applications for himself and his family.
In total, he submitted over 120 fraudulent applications through this method. Only 73 loans were funded, resulting in nearly $7 million in losses to the SBA.
On March 20, Park pleaded guilty to one count of wire fraud and one count of money laundering. On August 7th, he was sentenced to three years and 10 months in prison, and ordered to pay $6,993,700 in compensation and $535,041 in confiscation.
“Since the inception of the CARES Act, the fraud section has derived from PPP funds that have indicted more than 200 defendants in more than 130 criminal cases, fraudulently acquired cash proceeds of more than $78 million, and numerous real estate and luxury items purchased with such proceeds.
For more information, including how to report a fraud case, please see here.
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