Lexington man got a COVID loan through fraud, lost the money in bad investments

A Lexington man who received a COVID-19 relief loan through fraud and lost much of it in bad investments has been sentenced to six months in federal prison.

Shaan Ti Diyali, the man who was convicted of fraud by a federal jury, must also repay $53,390 to the U.S. Small Business Administration, according to a court document. U.S. District Judge Karen K. Caldwell sentenced Diyali Monday in federal court in Lexington.

Diyali applied in May 2020 for a low-interest loan through a program Congress had approved to help businesses hurt by the coronavirus pandemic, according to the court record.

The loan was designed to cover expenses such as rent and payroll for businesses. Diyali said the loan was for an insurance brokerage called Your Choice Services LLC., according to court records.

Diyali said in the loan application that the business had $100,000 in income the prior year, when in fact the company had no income and no business, Caldwell said in one ruling.

Diyali received a loan and invested much of it in Robinhood, a company that allows people to make trades in cryptocurrency and stocks. He ultimately lost almost all the money, Caldwell said in her ruling.

Diyali testified that he did not intend to defraud the U.S. and that a friend had told him the coronavirus relief money was “free money” and used Diyali’s personal information to apply for the loan, according to a release from U.S. Attorney Carlton S. Shier IV.

However, Diyali received the money and used it, according to the court record.

A jury convicted Diyali of wire fraud.

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