LOS ANGELES
A Gardena man was sentenced Monday to 13 years and six months in federal prison for running a multi-year scam, according to officials.
Troy Rustill Stroud fraudulently obtained nearly $1 million in business loans by setting up shell corporations – complete with people paid to pose as fake corporate “officers” – that deceived small business lenders into believing they were legitimate companies, officials stated.
U.S.District Judge Stephen V. Wilson sentenced Troy Rustill Stroud, 54, of Gardena. The judge also ordered Stroud to pay $968,169 in restitution.
Stroud plead guilty in August 2020 to one count of conspiracy to commit wire fraud. He has been in federal custody since his arrest in this matter in May 2020.
Stroud created several corporations that purported to be in business, but in fact, did none.
The sham businesses included kitchen remodeling companies Glorious Oak Company and Glossy Grape Investments Inc., and Polished Pine Group, an audio-visual company, according to court documents.
Stroud applied for business loans from at least 22 financial institutions and used the names of 14 companies in doing so, court documents state.
Stroud conducted a series of transfers from bank accounts in some of his corporations’ names to those held in other names to make it appear that the sham corporations were engaging in business, according to authorities.
Stroud paid other people to pretend to be officers of his corporation. He then used the names of those “officers” to apply online for business loans for his sham companies.
Stroud falsely reported that the shell companies had substantial revenues when in fact they had none.
When Stroud received the loan proceeds, he used them to pay for his personal expenses, and defaulted on the loans immediately or after a payment or two. Stroud admitted that his scheme to defraud lenders caused $968,169 in actual losses.
The FBI investigated this matter.