Officials stated that a federal jury convicted a Nevada man Friday of defrauding three banks of more than $11.2 million in COVID-19 pandemic relief funds intended to help small businesses impacted by the pandemic.
According to court documents and evidence presented at trial, Meelad Dezfooli, 30, of Henderson, engaged in a scheme to submit fraudulent loan applications under the Paycheck Protection Program (PPP).
The program provided loans to help small businesses continue paying employee salaries and certain other basic business expenses during the pandemic.
Dezfooli submitted three fraudulent PPP loan applications to federally insured banks, purportedly for the benefit of companies that the defendant controlled, and obtained more than $11.2 million in proceeds from those loans.
The evidence at trial showed that Dezfooli falsely represented certain material information in his loan applications, including information about payroll, employees, and use of the loan proceeds.
After fraudulently obtaining more than $11.2 million in PPP funds, Dezfooli laundered and/or spent the proceeds by, among other things: buying approximately 25 residences and two luxury cars, funding a personal investment account, and gambling extensively.
After he was originally charged, Dezfooli continued laundering criminal proceeds by selling five of the residences that he acquired with the fraudulently obtained PPP funds.
The jury convicted Dezfooli of three counts of bank fraud, three counts of money laundering, and four counts of engaging in monetary transactions in criminally derived property.
He is scheduled to be sentenced on Dec. 5 and faces a maximum penalty of 30 years in prison on each of the bank fraud counts, 20 years in prison on each of the money laundering counts, and 10 years in prison on each of the counts of engaging in monetary transactions in criminally derived property.
Trial Attorneys D. Zachary Adams and Taylor G. Stout of the Criminal Division’s Money Laundering and Asset Recovery Section (MLARS) and Assistant U.S. Attorney Daniel R. Schiess for the District of Nevada prosecuted the case.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Justice Department’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.