Former Middlesex County Resident Sentenced Over P3 Ripping Off

SAYREVILLE – A former Borough man was sentenced to 30 months in prison on Thursday for fraudulently receiving Payment Protection Program (PPP) funds and depositing a stolen and tampered with US Treasury check, the acting prosecutor said Rachael A. Honig.

Bernard Lopez, 40, who now resides in Atlanta, has previously pleaded guilty by video conference before US District Judge Peter G. Sheridan to one count each of bank fraud and theft of public funds. Judge Sheridan handed down the sentence Thursday by video conference.

According to the US Attorney’s Office, Lopez devised a scheme to commit bank fraud whereby a stolen and altered US Treasury check was deposited into a Lopez corporate bank account established in the name of Pezlo Management LLC. The check was amended to be made payable to Pezlo in the amount of $ 211,886 and was then deposited into Pezlo’s business bank account.

Lopez then removed or transferred the stolen product from Pezlo’s bank account before the bank could detect the fraud.

On June 24, 2020, Lopez had a fraudulent PPP loan application submitted to a lender on behalf of Company-1, an alleged company that Lopez controlled, the US attorney’s office said.

The Small Business Administration oversees the PPP, which is designed to provide forgivable loans to small businesses affected by the pandemic. Applicants for PPP loans go directly to banks or financial institutions participating in the program. In these applications, applicants make affirmative certifications on their average monthly salary expenses and number of employees.

Applicants also certify their intention to spend the proceeds of the PPP on permitted business expenses, such as labor costs, rent, utilities, and mortgage interest. PPP loans can be fully canceled if the recipient spends the loan proceeds for those authorized expenses within a specified time after receiving the proceeds.

Lopez’s PPP application falsely represented that Company 1 employed 25 employees, had a monthly payroll expense of approximately $ 192,000, and had mortgage / rental and utility expenses. Company-1 did not, in fact, employ any employees, nor did it incur any salary or utility expenses, the US attorney’s office said.

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Based on Lopez’s misrepresentation, the lender approved Lopez’s PPP loan application and provided Lopez’s purported business with $ 481,502 in federal COVID-19 emergency relief funds for struggling small businesses. Lopez then converted some of the proceeds for his own use, the US attorney’s office said.

In addition to the prison term, Lopez was sentenced to three years on probation and ordered to pay restitution of $ 137,000 and forfeiture of $ 481,502.

Email: [email protected]

Susan Rent covers Middlesex County and more for MyCentralJersey.com. To get unlimited access to his work, please register or activate your digital account today.

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