A California resident, Nipun Desai, has been sentenced to 12 months and one day in prison for making false statements related to the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). Acting U.S. Attorney Michael M. Simpson announced the sentencing by U.S. District Judge Wendy B. Vitter.
The CARES Act, signed into law on March 27, 2020, aimed to provide emergency assistance to small business owners affected by the COVID-19 pandemic through programs such as the Paycheck Protection Program (PPP) and Economic Injury Disaster Loans (EIDL).
Court records indicate that on January 25, 2021, Desai made false statements to secure a PPP loan of $146,947.50 for a hotel in Metairie, Louisiana. At the time of application, the hotel was permanently closed with no employees or payroll.
Desai’s sentence includes incarceration divided between time in federal prison and home confinement, followed by two years of supervised release. He must also repay approximately $234,000 to the SBA and $26,000 to the Louisiana Workforce Commission. Additionally, he was fined $25,000 and paid a mandatory special assessment fee of $100.
This investigation was part of efforts by the Pandemic Response Accountability Committee (PRAC) Task Force and involved agencies like the U.S. Department of Veterans Affairs – Office of Inspector General. The PRAC works to ensure transparency and oversight over federal COVID-19 spending exceeding $5 trillion.
Acting U.S. Attorney Simpson commended various investigative bodies including the Department of Labor – Office of Inspector General and U.S. Bankruptcy Trustee’s Office (Region 5). Assistant U.S. Attorney Edward J. Rivera led the prosecution from the Financial Crimes Unit.
For further details on fraud prevention during COVID-19 or to report related fraud attempts, visit https://www.justice.gov/coronavirus or contact the National Center for Disaster Fraud Hotline at 866-720-5721.
