RIVERSIDE, California
The former CEO of a La Quinta-based communication services company was sentenced this week to 27 months in federal prison, according to officials.
He fraudulently obtained $5 million in bank loans by submitting sham financial documents that overstated his company’s net worth, officials stated.
U.S. District Judge John Holcomb sentenced Richard Loren Lewis, 67, of La Quinta, and ordered him to pay $3.4 million in restitution.
Lewis pleaded guilty on May 7 to one count of bank fraud and one count of making a false statement to a financial institution.
From April 2013 to April 2016, Lewis, who was the CEO of Blue Wave Media Inc., schemed to defraud Silicon Valley Bank, a Santa Clara-based commercial bank that funds start-up technology companies.
Lewis gave false financial documents to Silicon Valley Bank that misrepresented Blue Wave Media’s net worth, liquidity, and revenue so the bank would lend millions of dollars to his company.
The false financial statements claimed that Blue Wave Media had millions of dollars in cash deposits and millions of dollars more in revenue streams.
In truth, Blue Wave Media had little to no cash on hand and little to no incoming revenue. Lewis’s misrepresentations made the bank to approve four loans totaling $5 million.
Lewis signed a loan and security agreement with Silicon Valley Bank in April 2013 to secure a $500,000 loan.
In January 2014, he submitted an amendment to the agreement to the bank to secure an additional $500,000 loan.
In June 2014, Lewis signed an agreement to secure a $1 million loan. In April 2015, Lewis signed a third amendment to the agreement with the bank to secure a $3 million loan.
As a result of Lewis’s criminal activity, Silicon Valley Bank sustained about $3.4 million in losses.
The FBI investigated this matter.