Articles Posted in Loan Fraud

Two men in New England were charged with fraudulently applying for a Payment Protection Program (PPP) loan worth over $500,000. These loans, stemming from the recent CARES Act, were designed to assist small businesses during the COVID-19 pandemic. David Butziger of Rhode Island and David Staveley of Massachusetts were charged with conspiracy to make false statements on their SBA forms and conspiracy of fraud. Staveley was separately charged with identity theft and Butziger was separately charged with bank fraud. They claimed on their applications to have multiple wage-earning employees at four different businesses. The Justice Department stated the employees who claimed to work at the businesses were not actually employed. The FBI uncovered emails between the two men, discussing ways to create an application for a federal PPP loan and the supporting documents under false information without getting caught.

Butziger claimed his company, Dock Wireless, had seven workers on the payroll. The Department of Revenue determined, under further investigation, that those workers were not employed at Dock Wireless. Records further showed no evidence of any alleged workers except Butziger. Staveley claimed on his application there were dozens of employees unemployed across three restaurants he owned. However, under further investigation, it was determined two of the restaurants were closed before the pandemic hit early March, and the other restaurant had no indication Staveley was involved in the business.

For the men to be charged in a criminal court, they must be proven, beyond a reasonable doubt, to be guilty of the charges. Fraudulent applications to the PPP must have evidence containing immense wrongdoing in one or more of the four categories needed on the original application: 1) necessity for the loans, 2) size eligibility for the loan- less than 500 employees, 3) amount requested for the loan- under $10 million, or 4) the use of the loan- payroll, mortgage, rent, and/or utilities.

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