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Three Charged in Multistate COVID-19 Relief Fraud Scheme
An elaborate plot to defraud federal pandemic relief programs results in multi-count indictments.
Three individuals have been indicted on charges related to a complex scheme to fraudulently obtain approximately $5 million in federal Paycheck Protection Program (PPP) loans and Economic Injury Disaster Loans (EIDL), according to U.S. Attorney Philip R. Sellinger. The suspects are also accused of laundering the proceeds from these loans.
The indictment involves Eric Rivera of Norcross, Georgia; Adrienne Ponzo of Bear, Delaware; and James Wessels of Middletown, Delaware. Charges against them include bank fraud conspiracy, wire fraud, and money laundering, with Rivera facing the most extensive list of offenses. The trio was initially charged by complaint in July 2023, leading to the recent indictment.
The fraudulent activities center on exploiting the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which was enacted in March 2020 to provide emergency financial assistance to Americans impacted by the COVID-19 pandemic. The accused manipulated the PPP and EIDL provisions by submitting fraudulent applications and documentation for businesses with minimal or nonexistent operations.
Rivera's role was particularly significant; he orchestrated the preparation of fake bank statements and IRS tax forms to support fraudulent loan applications, recruiting business owners to apply for loans under false pretenses. Wessels was instrumental in creating these fraudulent tax documents and structured the spending of loan proceeds to make ineligible expenditures appear as legitimate payroll expenses.
Adrienne Ponzo was implicated in preparing fraudulent EIDL applications, assisting Rivera in recruiting individuals to apply under false premises. After securing the loans, Rivera distributed a portion of the proceeds to Ponzo for her role in the deceit.
These actions led to substantial financial gains for the accused, with Rivera receiving up to 50% of the loan amounts in some cases. The indictments allege that the trio effectively laundered the illicit funds through various transactions and transfers.
The potential penalties for these crimes are severe, with bank fraud charges carrying a maximum sentence of 30 years in prison and a $1 million fine. Wire fraud and money laundering also carry hefty penalties, including up to 20 years in prison and significant fines based on the gross gain or loss from the offenses.
This case was brought to light by a coalition of federal agencies, including the FBI, the FDIC Office of Inspector General, and the U.S. Department of Labor's Office of Inspector General. It is part of a broader effort by the U.S. Department of Justice's COVID-19 Fraud Enforcement Strike Force, which focuses on identifying and prosecuting large-scale fraud related to pandemic relief efforts.
The legal proceedings are overseen by Assistant U.S. Attorneys Daniel A. Friedman and Jason M. Richardson of the Criminal Division in Camden. The defendants are presumed innocent unless and until proven guilty.
