Sentencing Memorandum by USA as to Joshua Bellamy — United States v. Bellamy (Dkt. 50, S.D. Fla. No. 0:21-cr-60064)

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U.S. District Court for the Southern District of Florida · No. 0:21-cr-60064-RKA · Doc. 50 · 2021-09-18 · Docket on CourtListener

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UNITED STATES DISTRICT COURT 
SOUTHERN DISTRICT OF FLORIDA 
BROWARD DIVISION 
 
CASE NO. 21-60064-CR-RKA 
 
UNITED STATES OF AMERICA  
 
 
 
 
 
 
 
 
 
 
vs. 
    
 
 
 
 
 
 
 
 
 
 
 
 
 
 
JOSHUA BELLAMY, 
 
 
Defendant. 
__________________________________/ 
 
GOVERNMENT’S SENTENCING MEMORANDUM  
The United States of America, by and through its undersigned counsel, hereby submits this 
Sentencing Memorandum as to Defendant Joshua Bellamy (the “Defendant”).  The Defendant is 
presently set for sentencing before the Court on September 22, 2021 for his conviction by guilty 
plea to one count of conspiracy to commit wire fraud, in violation of Title 18, United State Code, 
Section 371.  The offense stems from the Defendant’s application for a fraudulent Paycheck 
Protection Program (“PPP”) loan of $1,246,565 on behalf of his company, Drip Entertainment 
LLC (“Drip Entertainment”), and $1,648,413 in fraudulent loans sought through other conspirators 
that the Defendant referred to the scheme, for a total intended loss of $2,894,978. 
For the reasons set forth herein, the United States respectfully recommends that the Court 
sentence the Defendant to a term of imprisonment of 37 months, to be followed by three years of 
supervised release.1  A sentence of 37 months’ imprisonment represents the bottom of the 
applicable range of the United States Sentencing Guidelines (the “Guidelines”) as calculated by 
 
1 The United States is also seeking forfeiture of $1,246,565 and restitution of $1,246,565.  The Defendant 
has also agreed to pay a special assessment of $100 [ECF No. 32 ¶ 5]. 
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the United States Probation Office (“Probation”) in the Presentence Investigation Report, disclosed 
September 15, 2021 [ECF No. 45] (the “PSR”), to which the government has no objection.  
Furthermore, the sentence recommended herein by the United States will provide punishment for 
the offense of conviction that is sufficient, but not greater than necessary, to accomplish the 
purposes of sentencing set forth in 18 U.S.C. § 3553(a). 
I. 
FACTUAL BACKGROUND 
In early 2020, as the COVID-19 pandemic spread across the country and disrupted 
everyday life, causing illness, death and economic distress, the U.S. government assembled relief 
programs to help those whose livelihoods were jeopardized.  One of those programs was the PPP.  
Against this backdrop, the Defendant and his co-conspirators participated in a scheme to obtain by 
fraud millions of dollars in forgivable loans through the PPP, and have done so by conspiring with 
James Stote (referenced as “Individual 1” in the Information), Wyleia Williams, and others.  The 
Defendant obtained a fraudulent PPP loan for his own company, Drip Entertainment, with James 
Stote and Wyleia Williams providing falsified documents and submitting the application on the 
Defendant’s behalf in exchange for a kickback from the loan proceeds.  To inflate the size of these 
PPP loans, and the corresponding kickbacks, the conspirators relied on a variety of false 
statements, including by submitting falsified bank statements and payroll tax forms.     
A. 
The CARES Act 
In March 2020, in response to the many challenges presented by the pandemic, Congress 
passed the CARES ACT, Pub. L. 116-136, which created the PPP.  The PPP authorized $349 
billion in forgivable loans to small businesses to be used for payroll, mortgage interest, rent/lease 
payments, or utilities.   In April 2020, Congress authorized an additional $310 billion for PPP 
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funding.  These funds were designed to address the unprecedented crisis facing Americans—
especially business owners whose livelihoods were threatened by the public health emergency.  
PPP funds were designed as a lifeline.   
The program was designed to provide funds quickly and easily to qualifying individuals.  
PPP loans were not dispensed through any government bureaucracy; funds were distributed by 
banks who had existing relationships with many of the people in need.  To apply, individuals 
submitted an application to a participating financial institution along with supporting 
documentation as to the business’s payroll expenses.  The supporting documentation requirement 
was minimal and could be satisfied with one years’ worth of the company’s tax records.  If a PPP 
loan application was approved, the participating financial institution funded the PPP loan using its 
own monies, which were 100% guaranteed by the Small Business Administration (“SBA”). 
B. 
Overview of Defendant’s Conduct 
A more detailed recitation of the facts relating to the scheme are detailed in the Information 
(ECF No. 20), Defendant’s factual proffer statement (ECF No. 31), and the PSR (ECF No. 45).  
Beginning in May 2020 through in or around at least August 3, 2020, the Defendant 
conspired with James Stote, Wyleia Williams, and others to obtain by fraud a PPP loan on behalf 
of Drip Entertainment, a Florida limited liability company that the Defendant founded.   
In furtherance of the conspiracy, the Defendant caused the submission of a PPP loan 
application on behalf of Drip Entertainment that the Defendant knew contained materially false 
and fraudulent representations, including both the number of employees that Drip Entertainment 
had during each quarter of 2019 and the amount of wages paid by Drip Entertainment during each 
quarter of 2019.  Specifically, between May 14 and May 27, 2020, Stote and Williams, in 
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coordination with Defendant and at Defendant’s request, electronically submitted a PPP loan 
application form on behalf of Drip Entertainment, which falsely represented to Bank 1 that Drip 
Entertainment had 47 employees and an average monthly payroll of $498,626.    
Bank Processor 1 approved a PPP loan for Drip Entertainment, which Bank 1 funded in 
the amount of $1,246,565.  The Defendant then proceeded to spend those funds, which were 
supposed to go to payroll and other specified authorized expenses, on personal items, including 
luxury items such as jewelry, and charges at the Seminole Hard Rock Hotel and Casino.  The 
Defendant also wired approximately $311,641.67 to Stote as a kickback for his assistance in 
preparing and submitting the fraudulent Drip Entertainment loan. 
In addition to obtaining a fraudulent PPP loan for his own company, the Defendant 
recruited friends and associates, whom he referred to Stote for the purpose of submitting additional 
fraudulent PPP loan applications. The Defendant is directly responsible for two fraudulent loans 
seeking approximately $1,648,413 that came from his referrals.  The Defendant is therefore 
responsible for a total intended loss of $2,894,978, which includes the $1,246,565 Drip 
Entertainment loan and the $1,648,413 in fraudulent loans sought through his referrals. 
II. 
PROCEDURAL HISTORY 
On September 9, 2020, the Defendant was charged by complaint with conspiracy to commit 
wire fraud and bank fraud, in violation of Title 18, United States Code, Section 1349, wire fraud, 
in violation of Title 18, United States Code, Section 1343, and bank fraud, in violation of Title 18, 
United States Code, Section 1344 [ECF No. 1].  Following waiver of indictment, on February 25, 
2021, the Defendant was charged in an Information with conspiracy to commit wire fraud, in 
violation of Title 18, United States Code, Section 371 [ECF No. 20].  The Defendant pleaded guilty 
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before the Honorable Patrick M. Hunt to the Information pursuant to a written plea agreement on 
June 9, 2021 [ECF No. 31].  Sentencing is presently scheduled for September 22, 2021. 
III. 
SENTENCING GUIDELINES CALCULATIONS 
As explained below, the United States submits that the Defendant’s Total Offense Level is 
21.  At Criminal History Category I, this produces an advisory Guidelines range of 37-46 months 
of imprisonment pursuant to the Sentencing Table in Chapter 5, Part A of the Guidelines. 
A. 
The PSR Correctly Computes the Offense Level 
 
 
As set forth in the PSR, Probation computes the Total Offense Level at 21 (PSR ¶¶ 41-51).  
The United States concurs with the Offense Level computation in the PSR, which is as follows: 
Base Offense Level, § 2B1.1(a)(2) 
6 
Loss greater than $1,500,000 but less than $3,500,000, § 2B1.1(b)(1)(I) 
 
16 
Deriving more than $1,000,000 in gross receipts from one or more financial 
institutions, § 2B1.1(b)(17)(A) 
2 
Acceptance of Responsibility and Timely Notification § 3E1.1(a) and (b) 
(3) 
Total Offense Level 
21 
 
 
The Defendant does not dispute that these Guidelines provisions are applicable to him.  
Rather, the Defendant seeks a downward variance based primarily on his personal history and 
characteristics, his role in the offense, and his cooperation with the Government’s investigation.  
[ECF No. 46].  As further described below, the Defendant is not entitled to a downward variance. 
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IV. 
CONSIDERATION OF SENTENCING FACTORS UNDER 18 U.S.C. § 3553(A) 
Title 18, United States Code, Section 3553(a), enumerates several factors that the Court 
shall consider in sentencing a defendant.  As addressed in turn below, the 3553(a) factors relevant 
to the Defendant support the sentence recommended by the United States and do not support a 
downward variance. 
A. 
Nature and Circumstances of the Offense  
This was a serious offense.  In 2020, as the COVID-19 pandemic spread across the country 
causing illness, death and economic distress, the government created PPP loans to help small 
business owners and their employees whose livelihoods were jeopardized.  The Defendant took 
advantage of the program by causing the submission of a false application claiming to have 
employees and payroll that did not exist.  His application was supported by false tax forms and a 
fictitious bank statement.  So too were the fraudulent loan applications that were submitted after 
the Defendant referred other conspirators to the scheme.  The Defendant’s willful participation in 
this serious criminal conduct warrants a sentence of imprisonment within the advisory Guidelines 
range.  The United States’ recommended sentence of 37 months’ imprisonment, which is at the 
bottom of the Guidelines range, is sufficient but not greater than necessary to accomplish this goal. 
The Defendant’s role in the offense to which he has accepted responsibility and pleaded 
guilty does not warrant a downward variance.  The Defendant is being sentenced for participating 
in a conspiracy to defraud the PPP program in which the Defendant caused the submission of a 
fraudulent PPP loan application for his own company and in which the Defendant referred other 
conspirators to the scheme.  His role in that offense is not minor.  Rather, the Defendant was an 
important participant in the relevant conduct for which he is being held accountable.  The 
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Defendant was the one who sought the proceeds of the fraudulent loan for his company. While 
Stote, Augustin, and others working with them orchestrated and carried out the scheme, the 
Defendant ultimately is the person who said yes to the fraud that his co-conspirators were offering.  
The Defendant is the one who took in over $1.2 million in PPP loan proceeds—the largest single 
PPP loan obtained within this conspiracy of over 90 PPP loans—and who quickly spent those 
proceeds in just a few months’ time on extravagant personal expenses as well as paying kickbacks 
to his co-conspirator.  And the Defendant is the one who took further steps by recruiting other 
conspirators to the scheme in the expectation of receiving kickbacks on their fraudulent loans.  
Without the Defendant and others like him bringing additional conspirators to the table in rapid 
succession, this scheme could not have ballooned into over 90 fraudulent applications and over 
$34 million in loans in just a few weeks’ time. Put differently, but for the Defendant’s role in the 
offense, the Defendant’s fraudulent PPP loan would not have existed, and it is highly unlikely that 
the fraudulent loans that he referred to the scheme would have existed.  It is those loans for which 
he is being held responsible, and not the larger total of more than approximately $34 million in 
intended loss based on the entire scheme. 
There is no dispute that other conspirators, including Stote and Augustin, played leading 
roles in the scheme.  But the facts also establish that the Defendant himself played a central role 
in the fraudulent PPP loans for which he is being held accountable, and therefore a downward 
variance is not appropriate. 
B. 
History and Characteristics of the Defendant  
The Defendant is a 32-year-old man who was the founder of Drip Entertainment [ECF No. 
45 (PSR) ¶ 23].  He has no criminal history points.  He was a professional football player from 
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2012 through 2019, playing for several organizations in the National Football League, for which 
he earned significant income in the millions of dollars.  [PSR ¶¶ 85, 90.]   
The Defendant has faced a variety of personal challenges throughout his life as detailed by 
his sentencing memorandum.  Those hardships provide context for how he got to this point in life.  
That said, the Defendant fails to recognize that he is ultimately the person responsible for his own 
conduct.  Financial literacy is not required to know right from wrong.  A lack of education does 
not excuse pure greed.  Indeed, despite his claims of familial obligations and financial hardship, 
the fact remains that the Defendant spent large amounts of the money he obtained from his 
fraudulent PPP loan on personal indulgence.  The Defendant’s conduct cannot simply be explained 
away as the product of the Defendant’s personal circumstances; what he did was an inexcusable 
display of selfishness and avarice in the midst of a national tragedy. 
The Defendant agreed to plead guilty before being indicted, and thus deserves credit for 
accepting responsibility early and saving the government considerable resources in preparing for 
trial.  The sentence recommended by the United States reflects such acceptance because it is within 
the Guidelines produced by the Offense Level that has been adjusted downward by three levels for 
acceptance of responsibility pursuant to Section 3E1.1(a) and (b).   
However, the Government disagrees with the Defendant’s claim that he provided truthful, 
“full and complete cooperation” with its investigation.  [ECF No. 46 at 17].  Although the 
Defendant agreed to promptly meet with investigators and consented to a search of his phone, the 
Government did not evaluate his statements during his interview to be fully truthful and complete.  
The Defendant offered a misleading, incomplete, and untruthful version of a call he had with an 
individual that, unbeknownst to the Defendant, was an undercover law enforcement agent who 
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recorded the call.  The Defendant met with the Government in the apparent hope of convincing 
law enforcement that he did nothing wrong.  If the Government accepted the Defendant’s version 
of events as he portrayed them during his interview – during which he declined to accept his own 
wrongdoing – it is unlikely that he would have been charged with the offenses for which he 
ultimately pleaded guilty.  But that is obviously not how this story ended.  The Defendant’s 
cooperation with the Government does not qualify as substantial assistance that warrants a 
downward variance. 
C. 
Need for the Sentence to Afford Adequate Deterrence to Criminal  
Conduct and Protect the Public from Further Crimes of the Defendant 
The sentence in this case should address a need for both general and specific deterrence.  
As to general deterrence, the Eleventh Circuit has explicitly stated that “general deterrence is an 
important factor in white-collar cases, where the motivation is greed.”  United States v. Hayes, 762 
F.3d 1300, 1308 (11th Cir. 2014).  As explained above, this case was motivated by greed at a time 
when millions of Americans were suffering from the economic impact of a global pandemic.  As 
the pandemic spread, so too did fraud related to the PPP program and other programs designed to 
provide critical economic assistance—especially in the Southern District of Florida.  The 
Government’s recommended sentence of imprisonment in this case is thus appropriate to provide 
both specific and general deterrence.  Such a sentence will send a clear message to the Defendant 
and other offenders that there are serious consequences for defrauding government pandemic relief 
programs.  Indeed, as the pandemic continues to impact small businesses, the PPP loan program 
remains ongoing.  Actors like the Defendant who seek to defraud these programs not only drain 
the program of limited funding, they make it more difficult for administrators of government and 
other relief programs to get aid to individuals that qualify for and need it.  The Defendant’s 
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sentence will serve as a warning and deterrent to others inclined to exploit pandemic relief 
programs. 
Furthermore, a sentence at the bottom of the Guidelines range is sufficient to protect the 
public from future crimes of this Defendant who has no prior convictions. With this sentence, the 
Government believes the risk of recidivism is low. 
D. 
Need for the Sentence to Avoid Unwarranted Sentencing Disparities  
The sentence recommended by the United States will not create an unwarranted sentencing 
disparity.  There are two relevant points of comparison to avoid unwarranted sentencing 
disparities: sentences associated with others convicted of PPP related fraud, and the sentences of 
co-conspirators in this case.  While a relatively small number of defendants have been sentenced 
to date for offenses related to PPP fraud, judges of this Court and of other Districts have imposed 
sentences with significant terms of imprisonment.  See, e.g., United States v. Ioannis Kralievits, 
Case No. 21-20157-CR-Altonaga (S.D. Fla. June 30, 2021) (sentencing cooperating defendant to 
19-month term of imprisonment (following reduction pursuant to 5K1.1) in connection with two 
fraudulent PPP loans totaling approximately $824,750); United States v. David Hines, Case No. 
21-20011-CR-Cooke (S.D. Fla. May 12, 2021) (imposing 78-month term of imprisonment for 
defendant responsible for a loss of $3.9 million resulting from multiple fraudulent PPP loans);  
United States v. Ganell Tubbs, 20-00193-CR-Miller (E.D. Ark.) (imposing 41-month term of 
imprisonment for defendant responsible for loss of $1.9 million resulting from two fraudulent PPP 
loans). 
The Defendant will be the fourth of the conspirators in this scheme to be sentenced.  On 
July 13, 2021, the court sentenced co-conspirator Tiara Walker to one year and one day, three 
years of supervised release, and ordered her to pay restitution and forfeiture.  United States v. 
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Walker, Case No. 20-cr-60159-RAR (S.D. Fla., July 13, 2021).  On July 27, 2021, co-conspirator 
Tonye Johnson was sentenced by this Court to 18 months in prison, three years of supervised 
release, and ordered him to pay restitution and forfeiture.  United States v. Johnson, Case No. 21-
CR-60017-RKA (S.D. Fla.).  Both defendants Walker and Johnson only sought fraudulent PPP 
loans for their own companies, for less than $500,000 each, and did not refer others to the scheme.  
Both defendants Walker and Johnson had no criminal history points.2  On July 30, 2021, the court 
sentenced Andre Clark to 33 months imprisonment, three years of supervised release, and ordered 
him to pay restitution and forfeiture.  United States v. Clark, Case No. 21-CR-60029 (S.D. Fla.). 
Defendant Clark sought his own fraudulent PPP loan and also referred other conspirators to the 
scheme, and he did so with a significant criminal history.3  In contrast to Defendant Bellamy, 
however, Clark received a smaller PPP loan ($488,565) that was frozen by the bank before he 
could spend the proceeds.   
The intended loss amount of $2,894,978 attributable to the Defendant is an important 
measure of his relative culpability as compared to co-conspirators in a scheme involving over 90 
fraudulent loan applications and over $34 million in intended losses.  That is, the co-conspirators 
who led and organized the scheme and were involved in preparing or submitting even more 
fraudulent loan applications will be responsible for a greater intended loss amounts, and a 
correspondingly higher advisory Guidelines range under Section 2B1.1.  A sentence of 37 months 
for this Defendant, who is being held responsible only for the loss associated with his fraudulent 
 
2 Notably, however, defendant Johnson tested positive for marijuana during the presentence investigation 
and attempted to conceal his marijuana use from Probation by using a device to provide urine from someone 
other than the test taker. 
3 Based primarily on his referrals, Clark’s loss amount for sentencing purposes was between $3,500,000 
and $9,500,000.  However, unlike Defendant Bellamy, Clark ultimately received little money from the 
scheme, which the sentencing court found to be a significant factor at sentencing.  
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loan and those he directly referred to the scheme, will provide a consistent framework for future 
sentences of co-conspirators in this conspiracy whose Guidelines correlate to the losses for which 
they are directly responsible. 
V. 
RESTITUTION & FORFEITURE 
Restitution is mandatory in this case pursuant to 18 U.S.C. § 3663A(a)(1).  As set forth in 
the Plea Agreement [ECF No. 32 ¶ 17], the United States and the Defendant have agreed that the 
Defendant owes restitution.  The United States is seeking restitution in the amount of $1,246,565.  
Restitution is owed joint and severally with the Defendant’s co-conspirators charged in at least the 
following related case:  United States v. Stote, 20-4215-MJ-Greenberg (N.D. Ohio); United States 
v. Augustin, 20-mj-02207-DAR (N.D. Ohio); United States v. Williams, 20-mj-02208-DAR (N.D. 
Ohio). 
Furthermore, pursuant to the Plea Agreement, the Defendant agreed to forfeiture.  The 
United States is seeking a money judgment in the amount of $1,246,565.  [ECF No. 32 ¶ 13].  On 
August 26, 2021, the Court entered a preliminary order of forfeiture in which the Court entered a 
forfeiture money judgment of $1,246,565 [ECF No. 44]. 
 
* 
 
* 
 
* 
 
 
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CONCLUSION 
 
For the forgoing reasons, the United States respectfully recommends that the Court 
sentence the Defendant to a term of imprisonment of thirty-seven (37) months, to be followed by 
a term of supervised release of three (3) years.  The United States also requests that the Court order 
restitution, forfeiture, and a special assessment, consistent with the Plea Agreement [ECF No. 32] 
and the point and authorities discussed herein. 
 
 
 
 
Respectfully Submitted, 
 
 
JUAN ANTONIO GONZALEZ 
ACTING UNITED STATES ATTORNEY  
 
 
By:       /s/ David S. Turken                      
 
DAVID TURKEN 
Assistant United States Attorney 
Florida Bar No. 28573 
99 NE 4TH Street 
Miami, FL 33132-2111 
Tel.: (305) 961-9430 
Fax: (305) 530-7976 
Email: david.turken@usdoj.gov 
 
 
 
 
 
JOSEPH S. BEEMSTERBOER 
ACTING CHIEF, FRAUD SECTION 
    
 
By:      /s/ Philip B. Trout  
            PHILIP B. TROUT 
Trial Attorney, Fraud Section 
U.S. Department of Justice 
1400 New York Ave NW 
Washington, DC 20530 
Tel: (202) 616-6989 
Fax: (202) 514-3708 
Email: philip.trout@usdoj.gov 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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CERTIFICATE OF SERVICE 
 
 
I HEREBY CERTIFY that on September 18, 2021, I electronically filed the foregoing 
with the Clerk of the Court using CM/ECF.     
 
/s/ Philip Trout                               
 
 
 
 
 
 
 
 
Trial Attorney 
 
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