NJ Pair indicted for fraudulently obtaining more than $3.75M in COVID-19 loans

Jean Rabbitt, 52, and Kevin Aguilar, 52, both of Sherman, Texas, and both previously of Farmingdale, New Jersey, are each charged by indictment with: one count of conspiracy to engage bank fraud; seven counts of bank fraud; one count of conspiracy to engage in wire fraud; three counts of wire fraud; conspiracy to engage in monetary transactions in property derived from specified unlawful activity and one count of engaging in monetary transactions in property derived from specified unlawful activity; and one count of aggravated identity theft. Rabbitt is additionally charged with one count of making a false statement in a loan application.

According to documents filed in this case and statements made in court:

The Coronavirus Aid, Relief, and Economic Security (CARES) Act is a federal law enacted on March 29, 2020, to provide emergency financial assistance to millions of Americans suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses, through the Paycheck Protection Program (PPP).

Rabbitt and Aguilar submitted seven fraudulent PPP loan applications on behalf of four businesses that Rabbitt owned or controlled. Rabbitt and Aguilar made multiple false statements in their PPP applications, at least one of which was submitted to a Federal Home Loan Bank member. The lenders approved PPP loans totaling $3.33 million, and transmitted those funds to Rabbitt's businesses. Rabbitt and Aguilar also submitted fraudulent applications to the U.S. Small Business Administration (SBA) under the federal Economic Injury Disaster Loan (EIDL) program. Based on false statements in those applications, the SBA approved EIDLs to three of Rabbitt's businesses, totaling approximately $447,000.

After receiving the PPP and EIDL funds, Rabbitt and Aguilar transferred those funds to other businesses that Aguilar created to give the false appearance that the PPP and EIDL funds were being used for legitimate purposes. Aguilar and Rabbitt then used the PPP and EIDL funds for personal expenses.

Rabbitt and Aguilar also engaged in identity theft, by submitting an EIDL application using the name and identifying information of an individual who did not authorize the use of that information.

Rabbitt is also charged with making a false statement on a loan application, including with respect to her gross monthly income, in order to obtain financing to purchase a new truck from a Monmouth County car dealership.

U.S. Attorney Sellinger credited special agents of the Federal Deposit Insurance Corporation - Office of Inspector General, under the direction of Special Agent in Charge Patricia Tarasca in New York; special agents of IRS - Criminal Investigation, under the direction of Acting Special Agent in Charge Tammy Tomlins; special agents of the Social Security Administration, Office of the Inspector General, under the direction of Special Agent in Charge Sharon MacDermott; postal inspectors of the U.S. Postal Inspection Service in Newark, under the direction of Inspector in Charge is Christopher A. Nielsen, Philadelphia Division; special agents of the Federal Housing Finance Agency, Office of Inspector General, under the direction of Special Agent in Charge Robert Manchak; and special agents of the U.S. Attorney's Office for the District of New Jersey, under the direction of Special Agent in Charge Thomas Mahoney.

The government is represented by Assistant U.S. Attorney David V. Simunovich of the U.S. Attorney's Office's Health Care Fraud Unit, in Newark.

On May 17, 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 Department's response to the pandemic, please visit https://www.justice.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 Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

The charges and allegations contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

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Original text here: https://www.justice.gov/usao-nj/pr/monmouth-county-pair-indicted-fraudulently-obtaining-more-375-million-loans-meant-help