{"id":49490,"date":"2022-04-18T20:33:15","date_gmt":"2022-04-19T03:33:15","guid":{"rendered":"https:\/\/cjnotebook.com\/?p=49490"},"modified":"2022-04-18T20:33:15","modified_gmt":"2022-04-19T03:33:15","slug":"man-sentenced-to-41-months-in-prison-for-trying-to-steal-1-7-million-in-covid-relief-loans","status":"publish","type":"post","link":"https:\/\/cjnotebook.com\/?p=49490","title":{"rendered":"Man Sentenced to 41 Months In Prison for Trying to Steal $1.7 Million in COVID Relief Loans"},"content":{"rendered":"

\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0LOS ANGELES\u00a0<\/strong><\/span><\/p>\n

A Santa Clarita man was sentenced Monday to 41 months in federal prison for attempting to steal millions of dollars in Paycheck Protection Program (PPP) COVID-relief loans, officials stated<\/span><\/p>\n

\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 \"\" Raymond Magana submitted fraudulent applications that included fake tax documents and information for non-existent employees.<\/span><\/p>\n

\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 U.S. District Court Judge Stanley Blumenfeld Jr. sentenced Raymond Magana, 41. The judge ordered him to pay $360,415 in restitution. <\/span><\/p>\n

At Monday’s hearing, Judge Blumenfeld called Magana\u2019s crime \u201ca despicable offense\u201d and noted that Magana exploited a \u201cnational emergency\u201d in order to \u201cline his own pockets.\u201d\u00a0<\/span><\/p>\n

Magana pleaded guilty in January 2021 to one count of fraud in connection with major disaster or emergency benefits.<\/span><\/p>\n

\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0<\/span><\/p>\n

\"\"<\/p>\n

In May and June 2020, Magana submitted to banks PPP loan applications that contained false statements about the number of employees and the amount of payroll expenses. <\/span><\/p>\n

Specifically, on June 3, 2020, Magana submitted a PPP loan application to Customer\u2019s Bank for $940,416 for The Building Circle LLC, a company registered in his name.<\/span><\/p>\n

In that application, Magana falsely claimed the company\u2019s average monthly payroll was $376,167 for 40 workers. Magana admitted to submitting fraudulent tax documents that reported $4,402,000 in annual wages paid to 40 employees in 2019.<\/span><\/p>\n

Magana also claimed he used $852,000 to pay employee wages during the first quarter of 2020.<\/span><\/p>\n

\"\"IRS and California Employment Development Department records showed that the company never reported paying any employees, and the underwriting packet also did not include a list of employees or associates for the company, according to an affidavit filed with a criminal complaint in this case.<\/span><\/p>\n

Investigators later determined that the Pico Rivera address given as The Building Circle\u2019s headquarters was a 980-square-foot, single-family home that appeared to be a residence, not a business. <\/span><\/p>\n

Ultimately, the loan application was approved and $940,416 was funded to Magana\u2019s shell company on June 4, 2020, the affidavit states.<\/span><\/p>\n

Magana also applied for and received a PPP loan of $360,415 for Forward Builders LLC, another shell company, using fake tax documents and false employee information, and falsely claiming $1.73 million in employee wages.<\/span><\/p>\n

When a bank manager contacted Magana after one of the business accounts receiving PPP funds had been frozen because of suspicious activity, he told the bank \u201cWe have all the documents, we got approved.\u201d <\/span><\/p>\n

He refused to agree to return the improperly obtained PPP funds, the affidavit states. <\/span><\/p>\n

The bank nonetheless kept the $940,416 in the defendant\u2019s bank account frozen, and Magana could not access it, according to officials.<\/span><\/p>\n

The actual loss from the two loans that were approved and disbursed was $360,415. Prior to today\u2019s sentencing hearing, Magana deposited with the court $360,415 as his restitution payment.<\/span><\/p>\n

Magana\u2019s business partner, Steven R. Goldstein, 37, of Northridge, is serving a one-year federal prison sentence for committing fraud in connection with major disaster or emergency benefits. <\/span><\/p>\n

Goldstein pleaded guilty in December 2020 to a federal fraud charge and admitted in his plea agreement that he fraudulently obtained $655,000 in PPP loans for his companies by submitting false tax documents and fake employee information.<\/span><\/p>\n

IRS Criminal Investigation and the Small Business Administration\u2019s Office of Inspector General investigated this case.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

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