Former Hollywood exec sentenced to 3+ years in prison for $1.7M COVID fraud

William Sadleir, 68, of Beverly Hills, was sentenced by United States District Judge Dolly M. Gee, who also ordered him to pay $282,566 in restitution.

Sadleir pleaded guilty on March 16 to one count of bank fraud and one count of money laundering.

In April 2020, Sadleir -- who had been terminated from Aviron Pictures four months earlier after a major company investor discovered he had embezzled company funds -- filed bank loan applications that fraudulently sought more than $1.7 million dollars in forgivable PPP loans guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Sadleir obtained the loans for three Aviron entities by falsely representing that the funds would be used to support payroll expenses for 33 employees at each company, when in fact the entities were no longer operational.

Within days of the loans being funded on May 1, 2020, Sadleir transferred nearly $1 million to his personal checking account.

Sadleir spent most of the fraudulently obtained loan proceeds on utility bills, mortgage expenses, and his personal lawyer. He did not use any of the fraudulent loan proceeds to pay employees of the Aviron companies.

Following the discovery of the fraudulent loan applications, federal agents seized $308,058 of fraudulent loan proceeds from an Aviron account, and Sadleir returned $1,122,090 to the bank that funded the loans. As a result of the fraudulent PPP loan scheme, the SBA suffered losses of $282,566.

On September 9, Sadleir was sentenced in the Southern District of New York to http://www.doj.gov/usao-sdny/pr/hollywood-executive-and-former-white-house-staffer-sentenced-six-years-prison 72 months in federal prison after pleading guilty to two wire fraud counts for misappropriating more than $25 million that had been invested in Aviron. Judge Gee today ordered that the sentence imposed in the Los Angeles will run concurrent to the six-year sentence in the New York case.

The FBI, the SBA's Office of Inspector General, and the Federal Deposit Insurance Corporation's Office of Inspector General investigated the Los Angeles matter.

Assistant United States Attorney Gregory Bernstein of the Major Frauds Section prosecuted this case.

In May 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Justice Department's response to the pandemic, please visit http://www.doj.gov/coronavirus.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice's National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: http://www.doj.gov/disaster-fraud/ncdf-disaster-complaint-form.