PORTLAND, Oregon – An Oregon man pleaded guilty today after fraudulently converting to personal-use loans intended to help small businesses during the COVID-19 pandemic.
Andrew Aaron Lloyd, 51, of Lebanon, Oregon, pleaded guilty to bank fraud, money laundering and aggravated identity theft.
Lloyd has taken advantage of economic aid programs administered by the Small Business Administration (SBA), including Economic Disaster Loans (EIDL) and the Paycheck Protection Program (PPP). These programs were authorized by the CARES Act (Coronavirus Aid, Relief, and Economic Security), enacted on March 27, 2020. The CARES Act provided emergency financial assistance to millions of Americans and small businesses suffering from the effects. economic effects of COVID. -19 pandemic.
“The CARES Act relief programs were designed to help American small businesses navigate a historically difficult period in our country’s economic history. Andrew Lloyd saw an opportunity to profit from the COVID-19 pandemic and did so at the expense of hard-working Americans. Our office will continue to investigate and prosecute anyone who seeks to enrich themselves unjustly with public funds set aside to help those in need, ”said Scott Erik Asphaug, Acting United States Attorney for the District of Oregon.
“As Americans suffered from the economic collapse COVID-19 brought to our communities, Lloyd decided to cash in on the disaster. As honest, hard-working people were forced into unemployment and food queues, Lloyd poured stolen millions of dollars into brokerage accounts and real estate transactions. Thanks to our investigative partnerships, he now faces years in prison, ”said Kieran L. Ramsey, special agent in charge of the FBI in Oregon.
“As our country continues to recover from the destructive effects of the COVID-19 pandemic, there are individuals like Andrew Lloyd who choose to do even more harm to our country by exploiting the suffering of their fellow Americans,” he said. said Corinne Kalve, Acting Special Agent in Charge of Criminal Investigation for the IRS (IRS: CI). “IRS: CI will continue to prosecute those who choose to abuse our financial system and choose to steal pandemic recovery funds for their own illicit gain. “
“Lying to gain access to economic stimulus funds will be judged with justice,” said Weston King, special agent in charge of the SBA’s office of the inspector general for the Western region. “SBA OIG will aggressively pursue evidence of fraud against SBA programs aimed at helping small businesses across the country struggling with pandemic challenges. I want to thank the United States Attorney’s Office and our law enforcement partners for their dedication and pursuit of justice. “
According to court documents, in October 2020, federal agents opened an investigation into Lloyd based on information suggesting he fraudulently applied for PPP and EIDL loans from several financial institutions. From April 2020, Lloyd began submitting loan applications using numerous business names and personally identifiable information of relatives and associates without their consent.
Lloyd submitted false documents to justify the loan amounts requested, including an IRS Form 944 listing 2019 salaries allegedly paid by entities controlled by Lloyd. The total salaries allegedly paid by these entities ranged from $ 3 million to over $ 4.7 million. Lloyd’s loan applications also included lists of 56 to 64 employees and the total salaries paid to each. The loan application files included some of the same information in different business entities, including the physical locations of the businesses and the names of several dozen employees.
In total, Lloyd submitted nine PPP loan applications, six of which were accepted, resulting in a payment of over $ 3.4 million. Lloyd also applied for numerous EIDLs, one of which was accepted, resulting in additional payments of $ 160,000 to Lloyd. Upon receipt of the funds, Lloyd purchased real estate and invested in securities. Lloyd has transferred over $ 1.8 million from the PPP loan funds described above to his E * TRADE Securities brokerage account. The securities that Lloyd bought using the fraudulently acquired funds increased significantly in value.
In January 2021, agents seized Lloyd’s brokerage account, which included 15,740 shares of Tesla, Inc. purchased with the proceeds of his fraud. In March 2021, agents seized another account containing over $ 660,000 in securities and cash. Securities and cash seized from Lloyd’s accounts are currently valued at over $ 11 million.
On January 5, 2021, Lloyd was indicted by criminal complaint with electronic fraud, bank fraud and money laundering. He was arrested and first appeared in federal court on January 7, 2021. On June 6, 2021, he was charged with bank fraud, money laundering and aggravated identity theft.
With his continued acceptance of responsibility, the US Attorney’s Office will join Lloyd in jointly recommending a 61-month federal prison sentence. He will be sentenced on September 9, 2021 before US District Court Judge Michael J. McShane.
As part of his plea deal, Lloyd agreed to pay more than $ 3.6 million in restitution to the US Treasury. Lloyd also agreed to give up more than $ 11 million in cash and title and 23 properties purchased with P3 funds.
Lloyd’s accomplice, Russell Anthony Schort, 39, of Myrtle Creek, Ore., Has been charged alongside Lloyd for similar conduct. Schort is expected to plead guilty on July 1, 2021.
Acting US attorney Scott Erik Asphaug of the Oregon District made the announcement.
This matter was investigated by the FBI with assistance from the SBA Inspector General’s Office and the IRS Criminal Investigation. He is being sued by Gavin W. Bruce, Assistant United States Attorney for the District of Oregon.
Anyone with information about alleged attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Enforcement (NCDF) hotline at 866-720 -5721 or via the NCDF online complaint form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.