A brazen scheme to swindle millions in COVID-19 relief funds has landed a Nevada man in hot water. Jorge Abramovs, 40, pleaded guilty to participating in a scheme to defraud multiple financial institutions by filing fraudulent bank loan applications that sought over $1.9 million dollars in forgivable loans guaranteed by the Small Business Administration under the Coronavirus Aid, Relief, and Economic Security (CARES) Act.
According to court documents and admissions made in court, Abramovs submitted at least 12 Paycheck Protection Program (PPP) loan applications to seven different lenders in spring 2020. As part of the scheme, he submitted the loan applications in the names of multiple different businesses while falsely claiming to have numerous employees earning wages. In fact, these businesses were non-operational: they had no employees and no monthly payroll.
To support the fraudulent loan applications, Abramovs submitted false information about the businesses, fake tax documents and payroll schedules, and other forged documents. In total, Abramovs fraudulently obtained $1,986,737 in PPP loans. Rather than spending these funds to pay workers or for other specified business expenses as certified in the loan applications, Abramovs spent these funds on purchases for himself, including luxury condominiums, a Bentley, a Tesla, and payments on his home mortgage.
Abramovs further admitted that he failed to pay $475,000 in taxes owed to the IRS, relating to a different set of companies Abramovs controlled and operated. From 2014 through 2019, Abramovs was responsible for collecting and paying over employee-related taxes to the IRS, including withheld employee federal income tax, employee and employer FICA contributions, and federal unemployment tax. But Abramovs did not pay these withheld funds over to the IRS. Similarly, he failed to pay employer FICA contributions and unemployment tax payments the entities owed the IRS for those employees.
Abramovs pleaded guilty to one count of bank fraud, one count of monetary transactions in criminally derived property, and one count of willful failure to collect or pay over tax. U.S. District Judge Richard F. Boulware II scheduled sentencing for January 6, 2022. Abramovs faces a total statutory maximum penalty of 45 years in prison.
Las Vegas, Nev. – Jorge Abramovs, a resident of Las Vegas, pleaded guilty to bank fraud, monetary transactions in criminally derived property, and willful failure to collect or pay over tax. He is set to be sentenced on January 6, 2022.
This case was investigated by the FBI, SBA OIG, TIGTA, and IRS-Criminal Investigation. Trial Attorney Joseph McFarlane of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Jessica Oliva of the U.S. Attorney’s Office for the District of Nevada are prosecuting the case.
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Key Facts
- State: Nevada
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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