U.S. District Judge James Robart in Seattle accepted the guilty plea of a 62-year-old Redmond man on Thursday for his role in a scheme to steal $646,000.00 in COVID-19 relief monies from the federal Paycheck Protection Program.
Joseph Freeman set up shop with two firms to secure revolving Paycheck Protection Loans for the benefit of his fictitious workers.
To steal half a million dollars from the PPP, Freeman, and his accomplices exploited data they had gathered in 2004. This theft was discovered in May 2020.
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Freeman stated that Special Delivery LLC paid out $200,000 each month to its 15 employees, although in reality there was just Freeman working for the company.
Freeman attempted to obtain $500,000 in PPP money by filing false IRS paperwork to give the appearance that his company had employees.
The money from Freeman’s loan was deposited into his bank account on May 20th, 2020. After getting the money, Freeman set up a payroll service account to pay out to people who weren’t technically employees.
Freeman and his accomplices submitted another bogus application on June 15, 2020.
According to Freeman, New Jack Trucking LLC had 10 workers and paid them a total of $58,400 each month. Although the company never really conducted any business, Freeman and his partners claimed it had been in operation since February 2020.
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The conspirators made it look like New Jack Trucking had workers by filing false tax returns and using a fictitious bank statement. Freeman and his accomplices got the $146,000 for the fake application on June 16, 2020.
Freeman shared some of the wealth with the other conspirators and benefited personally from the rest.
After federal authorities discovered the fraud in July 2020 and contacted Freeman’s bank, the bank froze and returned roughly $220,000 in loan proceeds to the Small Business Administration. In total, the program cost $426,666.
On May 16th, 2023, Freeman will be given his punishment for his role in the fraud plot.
The maximum penalty for conspiracy to steal government funds is five years in jail and a fine of $250,000 or twice the defendant’s gross monetary gain or twice the victims’ gross monetary loss, whichever is greater.
The state’s attorney’s office has stipulated that they will recommend a sentence of no more than two years in jail for Freeman.
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COVID-19 Fraud Enforcement Task Force was formed by the Attorney General on May 17, 2021, to combat and prevent pandemic-related fraud.
Go to www.justice.gov/coronavirus to learn more about the department’s efforts to combat the pandemic.
