Hollywood Film Producer Charged with Fraudulent Use of COVID-19 Relief Funds
A California man has been charged with filing bank loan applications to fraudulently seek more than $1.7 million in forgivable Paycheck Protection Program (PPP) loans guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The man, William Sadleir, has been charged with wire fraud, bank fraud, false statements to a financial institution, and false statements to the SBA.
According to a Department of Justice release, Sadleir allegedly obtained over $1.7 million in forgivable loans guaranteed by falsely representing that the funds would be used for payroll expenses for three film production and distribution companies. Instead, Sadleir intended to use and did use a significant portion of the funds for personal and non-business-related expenses, such as personal credit cards and a car loan.
When Saleir obtained the funds, he allegedly transferred over half the money to a personal bank account and began using and attempting to use the funds to pay off personal credit card debts totaling more than $80,000 and a car loan totaling approximately $40,000, among other non-business related expenses.
“Today’s charges hold the defendant responsible for his alleged actions to swindle money out of a federal program intended to help those in need during a pandemic crisis,” said Special Agent in Charge Wade V. Walters of the Federal Deposit Insurance Corporation Office of Inspector General (FDIC OIG). “When an individual cheats the Paycheck Protection Program out of money, it deprives hard-working Americans and deserving small businesses. The FDIC OIG is committed to working with our law enforcement partners to investigate financial crimes in order to preserve the integrity of the nation’s banking sector.”
Last week, the Department of Justice also announced charges against a software engineer in Washington who filed fraudulent bank loan applications seeking more than $1 million in forgivable loans from the SBA CARES Act relief funds.
Baoke Zhang allegedly sought over a million dollars in forgivable loans from multiple banks by claiming payroll expenses associated with fake information technology companies that he created. Zhang allegedly provided fraudulent documents to two different lenders in support of applications for loans. In total, Zhang sought forgivable loans in the amount of $1,525,000.