A Southern California resident accused of fraud related to $1.7 million in COVID-19 relief funds passed out in the courtroom when he and his father were found guilty by a jury. Tarik Freitekh, 33, was facing bank and wire fraud charges.
Man Passes Out After He’s Found Guilty of PPP Loan Fraud
According to evidence presented during a six-day trial, Tarik and his father Izzat Freitekh, 55, obtained $1.7 million in fraudulent proceeds obtained by submitting multiple fraudulent PPP loan applications for four companies owned by Izzat Freitekh.
The loan applications misrepresented the number of employees and payroll expenses. After obtaining the fraudulent loan proceeds, the defendants were accused of engaging in unlawful monetary transactions with the proceeds of the scheme, including making $30,000 payments to family members.
Izzat Freitekh was convicted of one count of conspiracy to commit money laundering, three counts of money laundering, and one count of making false statements. He faces up to 10 years in prison for conspiracy to commit money laundering, 10 years in prison for each of the money laundering counts, and five years in prison for the false statements count.
While his father Tarik Freitekh was convicted of one count of conspiracy to commit wire fraud, one count of bank fraud, one count of conspiracy to commit money laundering, one count of money laundering, and one count of falsifying and concealing material facts. He faces up to 30 years in prison for the bank fraud count, 20 years in prison for the wire fraud and money laundering conspiracies, 10 years in prison for the money laundering count, and five years in prison for the falsifying material facts count.
Izzat will be allowed to remain out of jail until sentencing in six months. While his father Tarik Freitekh was ordered detained.
Small Business Deals
Feds Clamping on Pandemic Related Fraud
In May last year, the US Attorney General established the COVID-19 Fraud Enforcement Task Force to combat and prevent pandemic-related fraud. This is after, rampant fraud was observed with COVID-related relief. Late last year the Secret Service investigations into unemployment insurance and Paycheck Protection Program (PPP) loan fraud resulted in the seizure of more than $1.2 billion in assets while recuperating more than $2.3 billion of fraudulently obtained funds.
More in: PPP Loans