Superseding Indictment (Forfeiture Allegations) as to Eric Dean Sheppard — USA v. Sheppard (Dkt. 60, S.D. Fla.)

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U.S. District Court for the Southern District of Florida · No. 1:22-cr-20290-BB · Doc. 60 · 2023-08-23 · Docket on CourtListener

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Case 1:22-cr-20290-BB Document 60 Entered on FLSD Docket 08/24/2023 Page 1 of 12

FILED BY___IS___ D.C.

UNITED STATES DISTRICT COURT Aug 23, 2023
SOUTHERN DISTRICT OF FLORIDA ANGELA E. NOBLE

CLERK U.S. DIST. CT.
S. DB. OF FLA. - MIAMI

CASE NO. _ 22-20290-CR-BLOOM(s)

18 U.S.C. § 1343 ©
18 U.S.C. § 1028A(a)(1)
18 U.S.C. § 981(a)(1)(C)
21 U.S.C. § 853(p)
UNITED STATES OF AMERICA
VS.
ERIC DEAN SHEPPARD,
Defendant.
/
SUPERSEDING INDICTMENT
The Grand Jury charges that:
GENERAL ALLEGATIONS

At all times material to this Superseding Indictment:

The Small Business Administration, the COVID-19 Emergency, and the CARES Act

1. The Coronavirus Aid, Relief, and Economic Security (“CARES”) Act was a federal
law enacted on March 27, 2020, to provide emergency financial assistance to Americans suffering
economic harms from the COVID-19 pandemic. To achieve this goal, the CARES Act established
new temporary programs and expanded existing programs administered by the United States Small
Business Administration (“SBA”).

The Paycheck Protection Program

2. One source of relief provided by the CARES Act was the authorization of forgivable
loans to small businesses for job retention and certain other expenses, through a program referred

to as the Paycheck Protection Program (“PPP”).
Case 1:22-cr-20290-BB Document 60 Entered on FLSD Docket 08/24/2023 Page 2 of 12

3. Businesses could apply for PPP loans by submitting a PPP loan application (SBA
Form 2483). The PPP loan application required that these businesses acknowledge, through
authorized representatives, the program rules and make certain affirmative certifications to be
eligible to obtain the PPP loan. In the PPP loan application, these businesses, through authorized
representatives, had to state their: (a) average monthly payroll expenses, and (b) number of
employees. Because independent contractors were able to apply for PPP loans on their own,
employers’ payroll calculations and number of employees were based on wages paid to W-2
employees, not payments to independent contractors. The employers’ payroll expenses were used
to calculate the amount of money the applicant businesses were eligible to receive under the PPP.
In addition, these businesses had to provide documentation evidencing their payroll expenses;
typically, businesses would supply documents showing the amount of payroll taxes reported to the
IRS.

4. A PPP loan application had to be processed by a participating lender or the
participating lender’s delegee. If a PPP loan application was approved, the lender funded the PPP
loan using its own monies, which were fully guaranteed by the SBA. Data from the application,
including information about the borrower, the total amount of the loan, and the reports and
documentation regarding the business’s income and expenses, were transmitted by the lender to
the SBA in the course of processing the loan.

5. PPP loan proceeds were required to be used by the business on certain permissible
expenses— employee payroll costs, interest on mortgages, rent, and utilities. The PPP allowed
the interest and principal on the PPP loan to be entirely forgiven if the business spent the loan
proceeds on these expense items within a designated period of time and used a defined portion of

the PPP loan proceeds on payroll expenses.
Case 1:22-cr-20290-BB Document 60 Entered on FLSD Docket 08/24/2023 Page 3 of 12

The Economic Injury Disaster Loan Program

6. | The Economic Injury Disaster Loan (“EIDL”) program was an SBA program that
existed before the COVID-19 pandemic to provide low-interest financing to small businesses,
renters, and homeowners in regions affected by declared disasters.

7. The CARES Act authorized the SBA to provide EJDLs to eligible small businesses
experiencing substantial financial disruptions due to the COVID-19 pandemic. In order to obtain
a COVID-19 EIDL, a qualifying business was required to submit an EIDL application to the SBA
and provide information about its operations, such as the number of employees and gross revenues
and cost of goods sold for the 12-month period preceding January 31, 2020. The applicant was
also required to certify that the information in the application was true and correct to the best of
the applicant’s knowledge.

8. EIDL applications were submitted directly to the SBA, which processed the
applications with support from a government contractor. The amount of the loan, if the application
was approved, was determined based, in part, on the information provided in the application
concerning the number of employees, gross revenues, and cost of goods sold. The SBA issued
any funds under an EIDL directly to the applicant.

The Defendant and Relevant Entities

9. _HM-UP Development Alafaya Trails, LLC (“Alafaya Trails”) was a Florida limited
liability company with its principal address in either Miami, Florida or Bal Harbour, Florida.

10. HM Management and Development, LLC (“HMMD7”) was a Florida limited liability
company with its principal address in either Miami, Florida or Bal Harbour, Florida.

11. HM Four, LLC (“HM Four”) was a Florida limited liability company with its

principal address in either Miami, Florida or Bal Harbour, Florida.
Case 1:22-cr-20290-BB Document 60 Entered on FLSD Docket 08/24/2023 Page 4 of 12

12. Defendant, ERIC DEAN SHEPPARD, was a resident of Miami-Dade County.
SHEPPARD was the Manager of Alafaya Trails, HMMD, and HM Four. SHEPPARD had access
and control over the bank accounts of Alafaya Trails, HMMD, and HM Four at SunTrust Bank.

13. Bank Processor 1 was a third-party company. processor, based in San Jose,
California, that processed the PPP loan applications for Bank 1. Bank Processor | processed PPP
loan applications at its offices in Wilmington, Delaware, Conshohocken, Pennsylvania, and
Timonium, Maryland.

14. Bank 1 was a financial institution based in Salt Lake City, Utah, that was insured by
the Federal Deposit Insurance Corporation (“FDIC”). Bank 1 was an approved SBA lender of PPP
loans.

15. Bank Processor 2 was a third-party company processor, based in Chicago, Illinois,
that processed the PPP loan applications for Bank 2. Bank Processor 2 processed PPP loan
applications at its office in Chicago, Illinois.

16. Bank 2 was a financial institution based in Portland, Maine, that was insured by the
FDIC. Bank 2 was an approved SBA lender of PPP loans.

17. Bank 3 was a financial institution based in Fort Lee, New Jersey, that was insured by
the FDIC. Bank 3 was an approved SBA lender of PPP loans.

COUNTS 1-9
Wire Fraud
(18 U.S.C. § 1343)

1, Paragraphs 1 through 17 of the General Allegations section of this Superseding

Indictment are realleged and incorporated by reference as though fully set forth herein.

2. From in and around April 2020, through in and around March 2021, in Miami-Dade

County, in the Southern District of Florida, and elsewhere, the defendant,
Case 1:22-cr-20290-BB Document 60 Entered on FLSD Docket 08/24/2023 Page 5 of 12

ERIC DEAN SHEPPARD,

did knowingly, and with intent to defraud, devise, and intend to devise a scheme and artifice to
defraud, and to obtain money and property by means of materially false and fraudulent pretenses,
representations and promises, knowing that the pretenses, representations, and promises were false
and fraudulent when made, and for the purpose of executing the scheme and artifice, did knowingly
transmit and cause to be transmitted, by means of wire communication in interstate commerce,
certain writings, signs, signals, pictures and sounds, in violation of Title 18, United States Code,
Sections 1343 and 2.

PURPOSE OF THE SCHEME AND ARTIFICE

3. It was the purpose of the scheme and artifice for the defendant and his accomplices
to unlawfully enrich themselves by, among other things: (a) submitting and causing the submission
of false and fraudulent applications and supporting documents for loans and grants made available
through the SBA to provide relief for the economic effects caused by the COVID-19 pandemic,
including PPP loans and EIDLs; and (b) diverting fraud proceeds for the defendant’s personal use,
the use and benefit of others, and to further the fraud.

MANNER AND MEANS OF THE SCHEME AND ARTIFICE

The manner and means by which the defendant and his accomplices sought to accomplish
the object and purpose of the scheme and artifice included, among others, the following:

4. ERIC DEAN SHEPPARD and his accomplices submitted and caused to be
submitted false and fraudulent PPP loan and EIDL applications on behalf of Alafaya Trails,
HMMD, and HM Four, via interstate wire communications.

S. The PPP loan applications submitted and caused to be submitted by ERIC DEAN

SHEPPARD masked payments to independent contractors as wages paid to W-2 employees in
Case 1:22-cr-20290-BB Document 60 Entered on FLSD Docket 08/24/2023 Page 6 of 12

order to qualify for the PPP loans.

6. The PPP loan and EIDL applications submitted and caused to be submitted by
ERIC DEAN SHEPPARD included falsified documents, such as Internal Revenue Service
(“IRS”) and Florida Department of Revenue forms. The applications also misrepresented the type
of business the borrowing entities were engaged in, as well as revenues, monthly payroll, and
numbers of employees.

7. Some of the falsified documents submitted and caused to be submitted by ERIC
DEAN SHEPPARD in support of the false and fraudulent PPP and EIDL applications contained
the names and forged signatures of others, without the knowledge or consent of those individuals.

8. Based on the false and fraudulent PPP loan and EIDL applications submitted as part
of this scheme, Bank 1, Bank 2, Bank 3, and the SBA disbursed loan proceeds to bank accounts
controlled by ERIC DEAN SHEPPARD that were held by Alafaya Trails, HMMD, and HM
Four, via interstate wire transmissions.

9. ERIC DEAN SHEPPARD and his accomplices used the proceeds from the fraud
scheme for their own use, the use of others, and to further the fraud.

USE OF WIRES

10. On or about the dates specified as to each count below, in Miami-Dade County, in
the Southern District of Florida, and elsewhere, the defendant, ERIC DEAN SHEPPARD, for
the purpose of executing and in furtherance of the aforesaid scheme and artifice to defraud, and to
obtain money and property by means of materially false and fraudulent pretenses, representations,
and promises, knowing that the pretenses, representations, and promises were false and fraudulent
when made, did knowingly transmit and cause to be transmitted in interstate commerce, by means

of wire communication, certain writings, signs, signals, pictures, and sounds:
Case 1:22-cr-20290-BB Document 60 Entered on FLSD Docket 08/24/2023 Page 7 of 12

Count

Approximate Date

Description of Wire

October 22, 2020

Electronic submission of a false and fraudulent EIDL
application on behalf of HM Four, from the Southern District
of Florida to the SBA, resulting in an EIDL payment of

| approximately $150,000.

November 4, 2020

Electronic submission of a falsified lease agreement on behalf
of HM Four’s EIDL application, from the Southern District of
Florida to the SBA.

November 12, 2020

Electronic submission of a falsified letter from a banker in
support of HM Four’s EIDL application, from the Southern
District of Florida to the SBA.

January 19, 2021

Electronic submission of a false and fraudulent PPP second
draw loan application on behalf of Alafaya Trails, from the
Southern District of Florida to Bank Processor 1.

February 11, 2021

Electronic submission of false and fraudulent IRS Form 941s
(Employer’s Quarterly Tax Return) in support of Alafaya
Trails’ PPP second draw loan application, from the Southern
District of Florida to Bank Processor 1.

February 26, 2021

Electronic submission of a false and fraudulent IRS Form 1065
(U.S. Return of Partnership Income) in support of Alafaya
Trails’ PPP second draw loan application, from the Southern
District of Florida to Bank Processor 1.

March 11, 2021

Electronic submission of a false and fraudulent PPP second
draw loan application on behalf of Alafaya Trails, from the
Southern District of Florida to Bank Processor 2, resulting in a
PPP loan of approximately $148,397.

March 11, 2021

Electronic submission of false and fraudulent IRS Form 1065
(U.S. Return of Partnership Income) in support of Alafaya
Trails’ PPP second draw loan application, from the Southern | -
District of Florida to Bank Processor 2.

March 12, 2021

Electronic submission of a false and fraudulent PPP loan
application, IRS Form 1065 (U.S. Return of Partnership
Income), and IRS Form 940 (Employer’s Annual Federal
Unemployment Tax Return) on behalf of HMMD, from the
Southern District of Florida to Bank 3, resulting in a PPP loan
of approximately $148,591.

In violation of Title 18, United States Code, Sections 1343 and 2.

Case 1:22-cr-20290-BB Document 60 Entered on FLSD Docket 08/24/2023 Page 8 of 12

COUNTS 10-14
Aggravated Identity Theft
(18 U.S.C. §1028A)

On or about the dates enumerated as to each count below, in Miami-Dade County, in the
Southern District of Florida, and elsewhere, the defendant,
ERIC DEAN SHEPPARD,
during and in relation to a felony violation of Title 18, United States Code, Section 1343, that is,
wire fraud, as charged in Counts 2, 3, 6, 8, and 9, of this Superseding Indictment, did knowingly
transfer, possess, and use, without lawful authority, the means of identification of another person,

as specified in each count below:

Count | Approximate Date of Use Means of Identification

Name, signature, and title of M.S., used on a falsified
10 November 4, 2020 lease agreement electronically submitted to the SBA
in support of HM Four’s EIDL application.

Name, signature, and title of H.B., used on a falsified
1] November 12, 2020 bank letter electronically submitted to the SBA in
support of HM Four’s EIDL application.

Name, Employer Identification Number (“EIN”), and
12 February 26, 2021 Preparer Tax Identification Number (“PTIN”) of N.C.,
used on a falsified IRS Form 1065 tax. return
electronically submitted to Bank Processor 1 in
support of Alafaya Trails’ PPP second draw loan
application.

Name, EIN, and PTIN of N.C., used on a falsified IRS
Form 1065 tax return electronically submitted to Bank
13 March 11, 2021 Processor 2 in support of Alafaya Trails’ PPP second
draw loan application.

Name, EIN, and PTIN of N.C., used on a falsified IRS
14 March 12, 2021 Form 1065 tax return electronically submitted to Bank
3 in support of HMMD’s PPP loan application.

In violation of Title 18, United States Code, Sections 1028A(a)(1) and 2.
Case 1:22-cr-20290-BB Document 60 Entered on FLSD Docket 08/24/2023 Page 9 of 12

FORFEITURE ALLEGATIONS

1. The allegations of this Superseding Indictment are hereby re-alleged and by this
reference fully incorporated herein for the purpose of alleging forfeiture to the United States of
America of certain property in which the defendant, ERIC DEAN SHEPPARD, has an interest.

2. Upon conviction of a violation of Title 18, United States Code, Section 1343, as
alleged in this Superseding Indictment, the defendant shall forfeit to the United States any
property, real or personal, which constitutes or is derived from proceeds traceable to such offense,
pursuant to Title 18, United States Code, Section 981(a)(1)(C).

3. The property subject to forfeiture as a result of the alleged offenses includes, but is
not limited to, the following:

a. real property located at 180 Bal Cross Drive, Bal Harbour, Florida 33154-
1390; and

b. asum of at least approximately $893,145 in U.S. currency, which represents
the total amount of funds constituting, or derived from, proceeds traceable to
the alleged offenses and fraud scheme, which may be sought as a forfeiture
money judgment.

4, If any of the property subject to forfeiture, as a result of any act or omission of the
defendant:

a. cannot be located upon the exercise of due diligence;
b. has been transferred or sold to, or deposited with, a third party;
c. has been placed beyond the jurisdiction of the court;

d. has been substantially diminished in value; or
Case 1:22-cr-20290-BB Document 60 Entered on FLSD Docket 08/24/2023 Page 10 of 12

e. has been commingled with other property which cannot be divided without
difficulty;
the United States shall be entitled to forfeiture of substitute property under the provisions of Title
21, United States Code, Section 853(p).
All pursuant to Title 18, United States Code, Section 981(a)(1)(C), and the procedures set
forth in Title 21, United States Code, Section 853, as incorporated by Title 28, United States Code,

Section 2461(c).

A TRUE BILL

aloha LAPOINTE

STATES —

AIMEE C. JIMENF
ASSISTANT UNITED STATES ator

10
Case 1:22-cr-20290-BB Document 60 Entered on FLSD Docket 08/24/2023 Page 11 of 12
UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF FLORIDA

UNITED STATES OF AMERICA CASE NO.: 22-20290-CR-BLOOM(s)
v.
CERTIFICATE OF TRIAL ATTORNEY
ERIC DEAN SHEPPARD,
/ Superseding Case Information:
New Defendant(s) (Yes or No) No
Court Division (select one) Number of New Defendants
Miami Key West EJFTP Total number of counts 14 ~~
FTL WPB
I do hereby certify that:

1. [I have carefully considered the allegations of the indictment, the number of defendants, the number of probable
witnesses and the legal complexities of the Indictment/Information attached hereto.

2. lam aware that the information supplied on this statement will be relied upon by the Judges of this Court in setting
their calendars and scheduling criminal trials under the mandate of the Speedy Trial Act, Title 28 U.S.C. §3161.

3. Interpreter: (Yes or No) No
List language and/or dialect:

4. This case will take_7 days for the parties to try.

5. Please check appropriate category and type of offense listed below:

(Check only one) (Check only one)
I [] Oto 5 days Petty

Il 6 to 10 days Minor

III [£111 to 20 days Misdemeanor
IV E121 to 60 days Felony

V 61 days and over

6. Has this case been previously filed in this District Court? (Yes or No) Yes
If yes, Judge Bloom Case No. 22-20290-Cr-Bloom
7. Has acomplaint been filed in this matter? (Yes or No) No
If yes, Magistrate Case No.
8. Does this case relate to a previously filed matter in this District Court? (Yes or No) No
If yes, Judge Case No.
9. Defendant(s) in federal custody as of
10. Defendant(s) in state custody as of
11. Rule 20 from the____-___ District of
12. Is this a potential death penalty case? (Yes or No) No
13. Does this case originate from a matter pending in the Northern Region of the U.S. Attorney’s Office
prior to August 8, 2014 (Mag. Judge Shaniek Maynard? (Yes or No) No
14. Does this case originate from a matter pending in the Central Region of the U.S. Attorney’s Office
prior to October 3, 2019 (Mag. Judge Jared Strauss? (Yes or No) No
15. Did this matter involve the participation of or consultation with now Magistrate Judge Eduardo I. Sanchez
during his tenure at the U.S. Attorney’s Office, which concluded on January 22, 2023? No

Fe
By: Lina’ an
Aimee C. Jimenez Lo

Assistant United States Attorney
CourtID No. A55000795

Case 1:22-cr-20290-BB Document 60 Entered on FLSD Docket 08/24/2023 Page 12 of 12

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA

PENALTY SHEET

Defendant's Name: ERIC DEAN SHEPPARD

Case No: __22-20290-CR-BLOOM(s) _

Counts #: 1-9

Wire Fraud

18 U.S.C. § 1343

* Max. Term of Imprisonment: 20 years as to each count

* Mandatory Min. Term of Imprisonment (if applicable): N/A
* Max. Supervised Release: 3 years

* Max. Fine: $250,000

Counts #: 10-14

Aggravated Identity Theft

18 U.S.C. § 1028A(a)(1)

* Max. Term of Imprisonment: 2 years as to each count

* Mandatory Term of Imprisonment (if applicable): 2 years as to each count, consecutive to

any other sentence imposed
* Max. Supervised Release: 1 year
* Max. Fine: $250,000

*Refers only to possible term of incarceration, supervised release and fines. It does not include
restitution, special assessments, parole terms, or forfeitures that may be applicable.

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