Court filing

Response in Opposition by USA as to Eric Dean Sheppard — USA v. Sheppard (Dkt. 214, S.D. Fla.)

Filed February 23, 2024 in USA v. Sheppard; one of 253 filings from this case.

Record facts

Court	U.S. District Court for the Southern District of Florida
Filed	2024-02-23

U.S. District Court for the Southern District of Florida · No. 1:22-cr-20290-BB · Doc. 214 · 2024-02-23 · Docket on CourtListener

Full text

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA

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

UNITED STATES OF AMERICA

vs.

ERIC DEAN SHEPPARD,

Defendant.
__________________________________/

UNITED STATES’ RESPONSE IN OPPPOSITION TO DEFENDANT’S
POST-TRIAL MOTION FOR JUDGMENT OF ACQUITTAL

The United States of America, through the undersigned Assistant United States Attorney,
files this response to the defendant’s motion for judgment of acquittal, pursuant to Fed. R. Crim.
P. 29. The government’s evidence admitted in this trial was sufficient for a reasonable jury to find
the defendant guilty beyond a reasonable doubt as to Counts 5, 7, 8, 9, 13 and 14 of the Superseding
Indictment. Accordingly, the defendant’s motion should be denied.
BACKGROUND

The Superseding Indictment charged the defendant with devising and participating in a
scheme to defraud, by using materially false representations, in order to receive loan proceeds from
PayPal/ WebBank, ACAP SME/ Northeast Bank, Cross River Bank, and the U.S. Small Business
Administration (“SBA”), to which the defendant and his companies were not entitled. The
Superseding Indictment charged the defendant with nine counts of wire fraud and five counts of
aggravated identity theft, in violation of 18 U.S.C. §§ 1343 and 1028A(a)(1), relating to Paycheck
Protection Program (“PPP”) and Economic Injury Disaster Loan (“EIDL”) applications on behalf
of HM Management and Development, LLC (“HM Management”), HM-UP Development Alafaya
Trails, LLC (“Alafaya Trails”), and HM Four, LLC (“HM Four”). Following a jury trial, on
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 1 of 28

January 12, 2024, the jury returned Guilty verdicts as to four counts charging wire fraud (Counts
5, 7, 8, and 9), and as to two counts charging aggravated identity theft (Counts 13 and 14).
Following the jury’s verdict, the defendant filed a motion for judgment of acquittal in
which he advances many of the same arguments he made in his motion for judgment of acquittal
after the close of the government’s case, which motion this Court denied: he challenges the wire
fraud counts arguing that the government’s evidence failed to show that the defendant’s scheme
to defraud implicated a traditional property interest, as required by the Supreme Court in Ciminelli
v. United States, 598 U.S. 306 (2023); and he challenges the aggravated identity theft counts on
the basis that the evidence was insufficient to satisfy the requirements set forth under the Supreme
Court’s decision in Dubin v. United States, 599 U.S. 110 (2023). The defendant’s motion should
be denied, as the government’s evidence was sufficient for a reasonable jury to find the defendant
guilty beyond a reasonable doubt as to the wire fraud counts (Counts 5, 7, 8, and 9), and as to the
aggravated identity theft counts (Counts 13 and 14).
LEGAL STANDARD
After a jury verdict, a defendant may move for a judgment of acquittal, and “the court may
set aside the verdict and enter an acquittal.” See Fed. R. Crim. P. 29(c). When deciding a motion
for judgment of acquittal, the Court must determine “whether the evidence, examined in the light
most favorable to the Government, was sufficient to support the jury’s conclusion that the
defendant was guilty beyond a reasonable doubt.” United States v. Williams, 390 F.3d 1319, 1323-
24 (11th Cir. 2004) (citing United States v. Varkonyi, 611 F.2d 84, 85-86 (5th Cir. 1980)). When
applying this test, “[a]ll credibility choices must be made in support of the jury’s verdict.”
Williams, 390 F.3d at 1323. “The district court must view the evidence in the light most favorable
to the government … resolve any conflicts in the evidence in favor of the government, … and must
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 2 of 28

accept all reasonable inferences that tend to support the government’s case.” United States v.
Ward, 197 F.3d 1076, 1079 (11th Cir. 1999) (internal citations omitted). “’It is not necessary for
the evidence to exclude every reasonable hypothesis of innocence or be wholly inconsistent with
every conclusion except that of guilty, provided a reasonable trier of fact could find that the
evidence establishes guilt beyond a reasonable doubt.’” Williams, 390 F.3d at 1323-24 (quoting
United States v. Young, 906 F.2d 615, 618 (11th Cir. 1990)); Ward, 197 F.3d at 1079. “A
conviction must be affirmed unless there is no reasonable construction of the evidence from which
the jury could have found the defendant guilty beyond a reasonable doubt.” United States v.
Ignasiak, 667 F.3d 1217, 1227 (11th Cir. 2012) (internal citation omitted).
DISCUSSION

I.
The evidence at trial was sufficient to convict the defendant of wire fraud as set
forth in Counts 5, 7, 8 and 9.

In order to convict the defendant of wire fraud, the government has to prove the following
elements:
(1) The defendant knowingly devised or participated in a scheme to defraud
someone by using false or fraudulent pretenses, representations or promises
about a material fact;
(2) The defendant acted with the intent to defraud; and
(3) The defendant transmitted or caused to be transmitted by wire some
communication in interstate commerce to help carry out the scheme to defraud.

Eleventh Circuit Pattern Jury Instruction No. 051; see United States v. Machado, 886 F.3d 1070,
1082-83 (11th Cir. 2018). “’A scheme to defraud requires proof of material misrepresentation, or
the omission or concealment of a material fact calculated to deceive another out of money or
property.’” United States v. Maxwell, 579 F.3d 1282, 1299 (11th Cir. 2009). A defendant’s intent
to defraud requires that one “intend to use deception to cause some injury …” meaning “to obtain,
by deceptive means, something to which the defendant is not entitled.” United States v. Waters,
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 3 of 28

937 F.3d 1344, 1353 (11th Cir. 2019); Maxwell, 579 F.3d at 1301 (“An intent to defraud may be
found when the defendant believed that he could deceive the person to whom he made the material
misrepresentation out of money or property of some value.”). “A material misrepresentation is
one having a natural tendency to influence, or capable of influencing, the decision maker to whom
it is addressed.” United States v. Hasson, 333 F.3d 1264, 1271 (11th Cir. 2003); Maxwell, 579 F.3d
at 1299. “Because the issue is whether a statement has a tendency to influence or is capable of
influencing a decision, and not whether the statement exerted actual influence, a false statement
can be material even if the decision maker did not actually rely on the statement.” United States
v. Neder, 197 F.3d 1122, 1128 (11th Cir. 1999). “’The focus of the language defining a scheme to
defraud is on the violator, not the victim.’” United States v. Svete, 556 F.3d 1157, 1165 (11th Cir.
2009) (quoting United States v. Drake, 932 F.2d 861, 864 (10th Cir. 1991)).
A. The purpose of the defendant’s scheme to defraud was to deprive the lenders and the SBA of
a “traditional property interest.”_ _____________________________

Through the testimony of the SBA and the lender witnesses (PayPal, Northeast Bank and
Cross River Bank), the government presented evidence that the Paycheck Protection Program
offered very favorable terms, including that the loan amount could be entirely forgiven, or would
be paid back at 1% interest, and that the Economic Injury Disaster Loans had very favorable terms
as well, including below-market interest rates and a repayment term of 30 years. The testimony
and documents admitted through IRS expert Philip Palmer, Tamara Och, Florida Department of
Revenue, accountant Neal Cupersmith, and through the SBA and the lender witnesses, showed
that the defendant received PPP and EIDL loans to which his businesses were not entitled.

The defendant argues that the evidence did not establish that the scheme to defraud in this
case was designed to cause harm involving a “traditional property interest,” as required by the
Supreme Court’s decision in Ciminelli v. United States, 598 U.S. 306, 308-309 (2023). The
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 4 of 28

defendant argues that the SBA only suffered a “regulatory” harm and that the banks were not
harmed at all because they received what they bargained for. Def. Motion (DE 205) at 16-18. The
defendant’s arguments lack merit.

In Ciminelli v. United States, 598 U.S. 306 (2023), Ciminelli was convicted of wire fraud
for his involvement in a scheme to rig the selection process for companies that bid on state-funded
development projects in a way that favored his construction company. The Government relied on
a “right-to-control” theory of wire fraud recognized in the Second Circuit, “under which the
Government can establish wire fraud by showing that the defendant schemed to deprive a victim
of potentially valuable economic information necessary to make discretionary economic
decisions.” Id. at 310. “Consistent with the right-to-control theory, the District Court instructed
the jury that the term ‘property’ in § 1343 ‘includes intangible interests such as the right to control
the use of one’s assets.’” Id. at 311. The Supreme Court reversed Ciminelli’s conviction, holding
that “the wire fraud statute reaches only traditional property interests” and that “[t]he right to
valuable economic information needed to make discretionary economic decisions is not a
traditional property interest.” Id. at 316.

In this case, the “right-to-control” theory of wire fraud was not suggested anywhere in the
Superseding Indictment, in the evidence presented at trial, in the prosecutors’ presentations to the
jury in opening statements or closing arguments, or in the jury instructions. Instead, the focus of
the wire fraud allegations and the trial evidence was grounded in the “traditional property interest”
of the wire fraud statute: that the defendant carried out a scheme to defraud that involved making
material misrepresentations in PPP and EIDL loan applications and in falsified supporting
documents in order to obtain loan proceeds, i.e. money, from the banks and the SBA to which he
was not entitled. As this Court stated in its order denying the defendant’s motion for judgment of
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 5 of 28

acquittal, “Sheppard does not argue, nor can he, that loan proceeds are not ‘money or property’
within the meaning of the Wire Fraud statute.” DE 170 at 7. There is no question that the sole
object of the defendant’s scheme to defraud involved depriving the victims of a traditional property
interest contemplated by the Supreme Court in Ciminelli: the loan money made available through
the PPP and EIDL programs offered under the CARES Act. See, e.g., United States v. Mansouri,
2023 WL 8430239, *3 (W.D.N.Y. Dec. 5, 2023) (trial court rejected arguments to dismiss the wire
fraud and bank fraud counts charging a scheme to defraud involving fraudulent PPP and EIDL
applications; court found Ciminelli decision irrelevant where the indictment said “nothing about
depriving the lenders or the SBA of their ‘right to control’ property,” but instead alleged a scheme
that “involved false statements designed precisely to obtain money [belonging to the financial
lenders and the SBA], fitting well within the realm of ‘traditional property interests’ identified by
the Supreme Court.”).
B. Both the banks and the SBA were victims of the defendant’s scheme to defraud.

The defendant further argues that neither the SBA nor the banks can be considered victims.
As to the SBA, the defendant claims that it did not suffer a harm that involved a “traditional
property interest,” and that any harm to the SBA was “purely regulatory.” DE 205 at 16.1 Focusing
on the PPP aspect of the fraud, the lender witnesses testified about SBA’s involvement in the PPP
loan application process, which included providing de facto approval for the banks to disburse the
loan proceeds to the applicant. The SBA also functioned as a guarantor, paying back the loan
amounts, plus interest, to the banks if and when the loans were forgiven. In fact, in this case,

1 The defendant also argues that the SBA cannot be considered a victim because “the government’s
“SBA as victim’ theory varies from the Indictment ….” Yet the Superseding Indictment
specifically alleges that the PPP loans were fully guaranteed by the SBA, and that the SBA paid
the EIDL funds directly to the applicant. Superseding Indictment (DE 60) at ¶¶ 4, 8.
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 6 of 28

Alafaya Trails had its May 2020 PPP loan amount (plus interest) forgiven in 2021 by
PayPal/WebBank, and the SBA reimbursed WebBank the entire forgiveness amount. Govt. Exh.
18-6; Tr. 11/27/23, at 50; Tr. 11/29/23 PM, at 99. These transactions involved money – a
traditional property interest – that the defendant received as a result of his scheme to defraud.
The defendant incorrectly claims that Ms. Harris testified that the SBA’s interest was not
financial, but that it sought to “implement the government’s policy interests favoring (among other
things) traditional employment relationships.” DE 205 at 16. Ms. Harris testified about the PPP
and the Congress’s allocation of billions of U.S. Treasury dollars for the program. Of course the
SBA had a “regulatory” interest in ensuring that the PPP rules were followed so that those who
were actually eligible for the funds were the ones receiving the money. The SBA having this
interest does not negate the fact that the defendant’s wire fraud scheme, as alleged and proven,
was for the purpose of obtaining money from this government program that the SBA was tasked
to administer and to provide payment guarantees to lenders.

The Seventh Circuit’s decision in United States v. Griffin, 76 F.4th 724 (7th Cir. 2023), is
instructive. In that case, the defendants were charged with conspiracy to commit wire fraud and
substantive wire fraud counts, involving a scheme to obtain SBA-guaranteed financing for loans
that did not meet the SBA’s guidelines and requirements. Id. at 734. In a post-trial motion for
judgment of acquittal, the defendants argued that the government “did not prove that the wire fraud
scheme deprived the SBA of a protectable money or property interest.” Id. at 737. The Court
distinguished the Supreme Court’s Ciminelli decision, explaining that the Government “did not
pursue a right-to-control theory of fraud in this case; rather, the Government’s allegations focused
explicitly on the defendants’ attempts to deprive the SBA of loan guarantees and the millions of
dollars the SBA lost paying out on these loan guarantees.” Id. at 738. The Court upheld the wire
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 7 of 28

fraud convictions, concluding that “[t]hese guarantees, that committed the SBA to stand behind a
significant portion of the loan amount in case of default, are most certainly ‘property’ as required
by the wire fraud statute.” Id. at 339 (quoting Pasquantino v. United States, 544 U.S. 349, 356
(2005)). Even if the SBA’s role in the context of the PPP loans was as a guarantor of private loans,
the defendant’s scheme to defraud still involved a property interest, as the Seventh Circuit in
Griffin determined.2
Relying on Ciminelli and the Eleventh Circuit decision in United States v. Takhalov, 827
F.3d 1307 (11th Cir. 2016), the defendant argues there was no evidence that the defendant’s scheme
would harm the banks’ property interest because the banks stood to gain financially from making
the loans. DE 205 at 17. The Court in Takhalov explained that “if the defendant does not intend
to harm the victim – ‘to obtain, by deceptive means, something to which [the defendant] is not
entitled’ – then he has not intended to defraud the victim.” Id. at 1313 (quoting United States v.
Bradley, 644 F.3d 1213, 1240 (11th Cir. 2011)). Neither Takhalov nor Ciminelli (as discussed
above) applies to this case.
The defendant’s material misrepresentations in the loan applications and loan documents
were intended to deceive and to defraud. The banks were harmed. Northeast Bank and Cross
River Bank (and WebBank) disbursed the loan proceeds to the defendant’s companies. The

2 The defendant also makes a “convergence” argument that the SBA was not a victim because the
false representations were made to someone else, i.e., the loan processors. DE 205 at 17. This
argument is baseless. Ms. Harris, the SBA witness, and the lender witnesses testified about the
SBA’s involvement in the PPP application process. Moreover, Ms. Harris explained that the public
was informed that the PPP was a government program offering potentially forgivable loans to
small businesses during the COVID-19 pandemic. The defendant surely knew he was dealing with
the SBA, as he was required to review the application -which was SBA Form 2483 with the SBA’s
logo on the top– and certify that the information he provided was true and accurate. Govt. Exhs.
17-11, 18-5, 20-12. He also signed the loan note, which was on SBA letterhead, and contained
language explaining the PPP and the SBA’s involvement. Govt. Exhs. 20-14, 22-6.

Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 8 of 28

defendant is now making monthly payments on the loans. The banks are being deprived of the
funds they loaned the defendant, which he is paying back at a very advantageous 1% interest.
The wire fraud statute requires a scheme to defraud and intent to defraud. It does not
require that the victims of the fraud actually be injured. See United States Mansouri, 2023 WL
8430239 (W.D.N.Y. Dec. 5, 2023) (rejecting similar argument that financial institutions could not
have suffered a loss in PPP and EIDL fraud case, court explained that the “government need not
prove ‘that the victims of the fraud were actually injured’” but that the defendants “’contemplated
some actual harm or injury to the victims’”) (citing United States v. Novak, 443 F.3d 150, 156 (2d
Cir. 2006)). It is well established that the government must prove that a fraudulent scheme existed,
but the government does not have to prove that the fraudulent scheme succeeded. See United
States v. Bradley, 644 F.3d 1213, 1239 (11th Cir. 2011) (explaining that the victim does not have
to actually rely on the misrepresentation, and to gauge the defendant’s intent to defraud, the court
must determine whether the defendant “attempted to obtain” something to which he was not
entitled). In other words, the defendant can be guilty of wire fraud even if the loan was not
approved and funded and the fraud did not ultimately succeed. Similarly, the fact that a bank is
being paid back the money, or that it was reimbursed by the SBA for a loan that was forgiven does
not negate the crime of wire fraud. Thus, the defendant’s argument that the defendant did not
commit wire fraud because the banks suffered no actual financial loss must fail.
C. Other arguments against the wire fraud convictions lack merit.
The defendant advances several other meritless arguments challenging the sufficiency of
the wire fraud evidence against the defendant: (1) that there was no evidence connecting the
defendant to the submission of the false IRS Forms 940, 941, or 1065, and that the Forms 941 were
linked to the defendant based only on speculative handwriting evidence from a single witness, Jeff
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 9 of 28

Graff; (2) that the 1065 tax return that is the subject of Count 8 is not material to the fraud; (3) that
the government did not establish that the defendant was the person who actually filled out the
portal application as to Count 9, or that he submitted the application for Count 8; and (4) that the
government failed to establish that the defendant’s “workers” were not truly “employees.”
As to the first three arguments above, the evidence tying the defendant to the fraud was
substantial. The companies that received the PPP funds, HM Management and Alafaya Trails,
were the defendant’s companies for which he was the undisputed managing member and
decisionmaker. The defendant was the sole signer on the bank accounts that received the PPP
funds, which funds he controlled and spent as he saw fit. The defendant’s personal information
was provided for all of the loan applications, including his phone number, email address, home or
office address, and copy of his driver’s license. In all instances in which the lenders had records
of communications with the applicant, those communications were with the defendant’s email
address. The falsified 1065 tax returns, including the one listed in Count 8 and discussed in greater
detail below, were requested by the lenders primarily to corroborate payroll figures and were
integral to the fraud scheme. Because the defendant himself can transmit, or cause the wire
transfers to be transmitted by others, the law does not require the defendant to be the person who
sits in front of his computer to personally answer the questions posed in the portal or to be the
person who personally presses the button that uploads or submits the loan application’s supporting
documents. Nevertheless, in every instance in which the lender or DocuSign captured an IP
address in connection with a PPP loan application in this case, that IP address was tied to the
defendant’s home internet service.3 See Govt. Exh. 71.

3 The defendant relies on two documents to shift the blame to Jeff Vasilas. The defendant argues
that Mr. Vasilas “forged” the defendant’s name on Defense Exhibit G. Defense Exhibit G involved
a rental agreement for equipment relating to the Burlington project, the very project Mr. Vasilas
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 10 of 28

The defendant’s argument regarding the lack of evidence of “employees” vs. “independent
contractors” appears to be that the government failed to establish that the “workers” the defendant
paid were in fact, or should be if applying IRS employment rules, classified as “independent
contractors” whom the defendant could not count as “employees” for purposes of the PPP loan
applications. This is a meritless argument. The point of the PPP was to cover 2.5 months of a
business’s employee wages and related compensation, so the relevant inquiry was focused on the
defendant’s companies – the loan applicants – and how much they paid in wages and other
employee compensation (as reflected on their tax forms) in order to arrive at a payroll amount.
The overwhelming evidence in the case was that this amount was zero; the defendant’s companies
paid no wages during the relevant time period.4

Finally, the jury was entitled to draw reasonable inferences from the evidence, and the
evidence presented was more than sufficient to find the defendant guilty of wire fraud as to Counts
5, 7, 8, and 9.
II.
The Evidence of Aggravated Identity Theft Satisfies Dubin v. United States.
The offense of aggravated identity theft, pursuant to 18 U.S.C. §1028A, requires the

was tasked to oversee. There is no evidence the defendant’s name was “forged” other than the
defendant’s testimony, which the jury did not believe; the defendant’s name was written on the
agreement as a guarantor, and as owner of the shopping center and the person funding the project,
he was the guarantor. Notably, the page with Mr. Vasilas’ signature, where he is listed as “owner,”
has his name misspelled (“Vasillias” instead of “Vasilas”), which indicates that someone other
than Mr. Vasilas filled in portions of this document. The second document, Defense Exhibit I,
was a proposal to fix the defendant’s gate to his Bal Harbour residence, again showing Mr. Vasilas
engaging in contractor work for the defendant, not having anything to do with the defendant’s
fraud scheme.

4 HM Management was the only company for which the defendant ever reported having paid
employee wages to the IRS or to the Florida Department of Revenue. He never reported having
more than three employees and the last year he reported employee wages was for 2018. Govt.
Exhs. 12-2, 12-3, 12-5, 12-6, 16-1.
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 11 of 28

government to prove that (1) the defendant knowingly transferred, possessed, or used another
person’s means of identification; (2) without lawful authority; and (3) during and in relation to the
specified wire fraud counts alleged in the Superseding Indictment. See Eleventh Cir. Pattern Jury
Instr. O40.3 (Mar. 2023). The evidence was sufficient for the jury to find the defendant guilty
beyond a reasonable doubt of aggravated identity theft, as charged in Counts 13 and 14 of the
Superseding Indictment, pursuant to the Supreme Court’s decision in Dubin v. United States, 599
U.S. 110 (2023).
A.
Pertinent Facts from the Trial.
1.
Alafaya Trails PPP Loan Application to ACAP SME/ Northeast Bank
Count 13 of the Superseding Indictment involved the use of accountant Neal Cupersmith’s
identity, including his name, employer identification number (“EIN”), and preparer tax
identification number (“PTIN”) on a falsified IRS 1065 partnership tax return for tax year 2020,
submitted to ACAP SME, loan processor for Northeast Bank, in support of Alafaya Trails’ second
draw PPP loan application. Government Exhibit 20-16, admitted as part of ACAP SME’s records,
showed that several documents were uploaded to its portal at different times, starting on March
11, 2020, and that the loan application information and the supporting loan documents were
separate wire transmissions to ACAP SME/ Northeast Bank. Tr. 12/4/23, at 112. Count 7 charged
the defendant with wire fraud involving the submission of the Alafaya Trails loan application
information to ACAP SME, and Count 8 separately charged the defendant with wire fraud
involving the submission of the falsified IRS 1065 income tax return that is the subject of Count
13. The jury returned guilty verdicts as to Counts 7, 8, and 13.
The evidence at trial showed that Alafaya Trails was a company that owned a shopping
center in Orlando, Florida, and that it was structured as a partnership, over which the defendant
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 12 of 28

exercised control as the managing member. Tr. 12/6/23 PM, at 12-13, Govt. Exhs. 23-1, 23-2.
The false information and documents that the defendant submitted to ACAP SME and Northeast
Bank on behalf of Alafaya Trails reported an average monthly payroll of $59,359, 19 employees,
and a total loan amount of $148,397 (based on 2.5 times the amount listed as average monthly
payroll). The defendant falsely reported gross revenues in 2020 as having declined by more than
25% from 2019, and he falsely represented Alafaya Trails as a construction business. Northeast
Bank approved the loan application, and on March 31, 2021, it disbursed the amount of $148,397
to the defendant’s bank account. Govt. Exhs. 20-20 through 20-23, 41-1. The facts show that the
falsified and forged 2020 1065 income tax return using the identity of Mr. Cupersmith supported
all of these misrepresentations and was integral to this fraud.
The evidence at trial established that had the defendant submitted truthful information and
documents for Alafaya Trails, it would not have qualified for a PPP loan. Alafaya Trails had no
employees, it paid no wages or salaries, or employee benefits, and its partners had no net earnings,
which meant that its payroll was zero and its loan amount should have been zero; it had a revenue
increase instead of a revenue decrease in 2020 over 2019, which meant that it was not eligible for
a second draw of PPP funds; and it was a landlord of commercial property, which was a business
category excluded from the Paycheck Protection Program.
David Toye, Vice President for Northeast Bank, testified that ACAP SME was responsible
for interacting with the applicant, receiving the documents that Northeast Bank requested of the
applicant, and screening the applicant per the SBA’s rules. Tr. 12/4/23, at 73-75. Northeast Bank,
as the underwriter of the loan, reviewed the information and documents received and made a
decision whether to fund the loan. Id.
The SBA and the lender witnesses testified that the amount of a PPP loan was based on the
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 13 of 28

applicant’s average monthly payroll, multiplied by 2.5 times. The defendant applied to ACAP/
Northeast Bank as a limited liability company (“LLC”), with employees, and thus, the loan amount
was based primarily on the wages paid to the employees, plus certain other expenses, such as the
employer’s payments for employees’ benefits like health insurance coverage. Govt. Exhs. 20-12,
20-21. Although Alafaya Trails was not identified on the loan application as a partnership, it was
a partnership that filed income tax returns using an IRS Form 1065 for reporting partnership
income. Govt. Exh. 13-2.
Mr. Toye explained that Government Exhibit 20-3 (“UW Template”), admitted as part of
ACAP SME and Northeast Bank’s exhibits, was an on-line tool that guided both ACAP and
Northeast Bank regarding what documents and information to request and review from the
applicant. Tr. 12/4/23, at 87-90; Govt. Exh. 20-3 (Partnership and Corporations tabs attached as
Exhibit 1).5 Exhibit 20-3 instructed ACAP (as verifier) and Northeast Bank (as the underwriter)
to request and review the applicant’s income tax return, which was listed as an IRS Form 1120 for
corporations. See Exh. 1. Because Alafaya Trails was a partnership, however, Mr. Toye explained
that its IRS Form 1065 and K-1 were the corporate tax documents that ACAP and Northeast Bank
would have requested here. Tr. 12/4/23, at 90-91; see Exh. 1. Indeed, the defendant submitted a
(false) 2020 IRS Form 1065 tax return for Alafaya Trails with its loan application to ACAP/
Northeast Bank.6

5 Portions of this trial exhibit, in pdf format, were filed by the defendant as defense Exhibits A and
B. Government Exhibit 20-3 is an excel spreadsheet having several tabs, with each one
corresponding to the type of applicant indicated (sole proprietorship, partnership, corporation,
etc.). The filed Exhibit 20-3 has additional columns on the right side that are not included on the
defendant’s version in Exhibits A and B, which are important here, as they list the types of tax
documents that ACAP and Northeast Bank were supposed to request and review.

6 The fact that Government Exhibit 20-3 (the guidance tool for the reviewer and the underwriter)
had the corporations tab marked (where the underwriter was prompted to request an 1120 tax
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 14 of 28

Mr. Toye explained that the loan amount was based on the business’s payroll, which
consisted of payments to its W-2 employees. Tr. 12/4/23, at 95. Mr. Toye also explained that, as
a partnership, Alafaya Trails’ 1065 partnership return and its K-1 were requested because a
partnership’s payroll amount included the partners’ net earnings, capped at $100,000 for the year.
Id.; Govt. Exh. 20-21 (SBA Form 2483), at 5 (explaining that for the PPP, a partnership’s payroll
costs includes the general partners’ net earnings, as reported on the IRS Form 1065 K-1).7
The corporations tab on Exhibit 20-3, which was the tab filled in for the Alafaya Trails
application, listed the loan amount the defendant requested of $148,397, and what he reported as
gross wages of $815,358.8 Exhibit 20-3 guided the underwriter to calculate the payroll amount,
consisting of wages, and other payments to employees, such as for health insurance and retirement
plans, to be drawn from: IRS Form 941s (Employer’s Quarterly Tax Returns) or IRS Form 940
(Employer’s Annual Federal Unemployment Tax Return), IRS Form 1120 (for corporation, which
for a partnership was IRS Form 1065), and State quarterly wage reporting forms.9 The evidence
showed that the defendant submitted all of these forms, and that all were false. Govt Exhs. 20-8,

return) and the partnership tab was listed as “the wrong tab” (where the underwriter was prompted
to request a 1065 return) did not mean that the lender did not request an income tax return from
Alafaya Trails. It only indicated that as an LLC, the underwriter was automatically directed to the
“corporations” tab that listed an 1120 tax return, instead of a 1065 partnership return.

7 The defendant was a limited partner of HM Four, owner of Alafaya Trails, and he reported no net
earnings on the IRS Form 1065, K-1. This aspect of the false 1065 tax return submitted to ACAP/
Northeast Bank was not changed from the real tax return.

8 Based on the annual payroll amount of $815,358 the defendant reported on the false tax forms
(Form 940 and 1065 tax return), Alafaya Trails was eligible for a greater loan amount of $169,866
than the amount requested of $148,397. Govt. Exh. 20-3 (corporations tab). As Mr. Toye testified,
a loan amount greater than $150,000 would have prompted Northeast Bank to conduct a more in-
depth review of the loan application. Tr. 12/4/23, at 90-91.

9 Government Exhibit 20-3 instructed the underwriter which lines on the 1120 or 1065 tax return
reported payments for employee health insurance and retirement plans (1065 lines 18 & 19).
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 15 of 28

20-10, 20-11, 20-19, 20-20. Both the Form 940 and the 1065 tax return contained the (false)
annual “payroll” figure of $815,358 that the defendant reported.

The Alafaya Trails application to ACAP/ Northeast Bank was for a second draw loan,
having previously received a PPP loan from PayPal/WebBank. For a second draw loan, Alafaya
Trails had to show a revenue decline in 2020 from the same time period (quarter or annual) in
2019. Tr. 12/4/23, at 78. As a result, the applicant’s income tax return had the additional purpose
of verifying that the business had at least a 25% revenue decline in 2020 from 2019. Alafaya
Trails’ 2020 1065 tax return falsely reported gross rents to support a 25% revenue decrease from
2019, whereas the real tax return reported a revenue increase. Govt. Exhs. 20-11, 20-20, 30-3, 30-
7; Tr. 12/4/23, at 91-92. Because the loan amount the defendant requested was below $150,000,
however, the defendant could have waited to submit documentation supporting the revenue decline
when applying for forgiveness. Tr. 12/4/23, at 91-92; Govt. Exh. 20-3.

Ms. Harris from the SBA testified that certain types of businesses were excluded from the
Paycheck Protection Program, such as developers and landlords. Tr. 11/28/23, at 145-46. Mr.
Toye explained that the type of business of the applicant was verified through the business code
listed on the income tax return. Tr. 12/4/23, at. 105, 107. Indeed, the 2021 version of the SBA
Form 2483 directed the applicant to use the business code that was listed on its income tax return.
Id.; Govt. Exh. 20-21, at 6. The 2020 1065 tax return the defendant submitted to ACAP/Northeast
Bank falsely reported Alafaya Trails as a company in the construction business, instead of the
business that Mr. Cupersmith assigned to Alafaya Trails on its real tax return, which was a
landlord/lessor of non-residential buildings. Mr. Toye testified that a lessor of non-residential
buildings was a business category that was not eligible for a PPP loan. Tr. 12/5/23 AM, at 5.

Mr. Toye explained that the income tax return needed to be signed, even if it had not yet
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 16 of 28

been filed with the IRS: “[t]hat was one of SBA’s requirements or rules was that if you haven’t
filed it yet to sign the document showing that you’re certifying that this is accurate and true.” Tr.
12/4/23, at 103. Finally, Mr. Toye explained the importance of the tax return to the Bank’s loan
decision in the context of a standard commercial loan. Tr. 12/5/23 AM, at 6.
As Mr. Toye testified, had the defendant truthfully reported that he made payments only to
independent contractors, and that he paid no wages to employees, no net earnings to partners, his
payroll amount and his “loan amount would be zero dollars.” Id.
Mr. Cupersmith, the defendant’s accountant for 25 years, testified that Alafaya Trails never
reported wages. Tr. 12/12/23 AM, at 76. Mr. Cupersmith also testified that he did not prepare or
sign the 1065 tax return submitted to ACAP/ Northeast Bank, or authorize the defendant or anyone
on the defendant’s behalf to use his name, his PTIN, or his business in this manner. Tr. 12/12/23
PM, at 6-8; Govt Exhs. 20-11, 20-20.
Regarding the false entries and the forgery on the tax return, Mr. Toye stated:
Q: If you had information that that 1065 tax return was falsified as to the business
code and the wages, and the gross rents and that the tax preparer name was forged
on that document, would it have affected the decision that you made with respect
to this loan?
A: Yes. Definitely.
Q: What would it have done?
A: We wouldn’t have funded the loan.

Tr. 12/4/23, at 108.
2.
HM Management’s PPP Loan Application to Cross River Bank
Count 14 of the Superseding Indictment also involved the use of Mr. Cupersmith’s identity,
including his name, EIN, and PTIN on a falsified IRS 1065 tax return for tax year 2020, submitted
to Cross River Bank in support of a PPP loan application, this one on behalf of the defendant’s
company, HM Management. Unlike the process that Northeast Bank had in place in which the
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 17 of 28

applicant communicated with the loan processor ACAP SME, Cross River Bank received the loan
application information and supporting documents directly from the applicant. Spencer Lord,
program manager for Cross River Bank, testified that once the applicant had all of the information
and supporting documents uploaded, these were submitted all at once to Cross River Bank’s portal.
Tr. 12/5/23 PM, at 40, 53, 123.10 Count 9 charged the defendant with wire fraud involving the
submission of the HM Management loan application information, together with the falsified IRS
1065 tax return that is the subject of Count 14, and a falsified IRS Form 940. The jury returned
guilty verdicts as to Counts 9 and 14.
The evidence at trial presented HM Management as a real estate company through which
the defendant managed his other properties, specifically the shopping centers owned by Alafaya
Trails and another company, CJUF III Flagler, LLC. Tr. 12/6/23, at 8, 18; 12/12/23 PM, at 17;
Govt. Exhs. 23-1, 23-2. HM Management was also structured as a partnership, although the
defendant was the managing partner and 99% owner. Tr. 12/6/23, at 19; 12/12/23, at 71. For the
HM Management PPP application, this was a first draw application in which the defendant falsely
reported an average monthly payroll of $59,437, a total loan amount of $148,592, and 18
employees. Govt. Exh. 22-6. The defendant falsely listed HM Management as a construction
company. Id. Cross River Bank approved the loan application, and on March 29, 2021, it disbursed
the amount of $148,592 to the HM Management bank account. Govt. Exhs. 22-6, 22-7, 41-1.
Because HM Management applied to Cross River Bank as an LLC with employees, the
loan amount was based on the company’s wages paid to employees in the tax year selected, 2020.
Mr. Lord explained the application process in which the applicant would “proceed through the

10 The defendant refers to a loan processor for Cross River Bank, “Revenued,” but the evidence at
trial was that Cross River Bank received and reviewed the PPP applications and supporting
documents directly from the applicants.
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 18 of 28

application flow answering the questions and providing the requested information.” Tr. 12/5/23
PM, at 40. The last step of the process “was uploading the requested documents to the application.”
Id. Mr. Lord testified that Cross River Bank requested “filed tax forms, identification and voided
check.” As for the types of tax forms, Mr. Lord said, “it depended on the type of business.” In
this case, what was provided was “a 1065 and a 940.” Id. at 59. Mr. Lord explained that Cross
River Bank requested the 1065 tax return on its portal as part of the “application flow” based on
the type of business and how it filed its taxes. Id. at 75-76, 124. According to Mr. Lord, Cross
River Bank reviewed the tax return information for “the payroll amount.”11 Id. at 77. The
supporting documentation the defendant provided was a false 2020 1065 tax return, and a false
Form 940 for 2020. Govt. Exhs. 22-3, 22-4.
The 1065 tax return that the defendant submitted with the HM Management application
reported false “salaries and wages” in the amount of $815,358 for tax year 2020, which was the
same false figure included on the Alafaya Trails 1065 tax return submitted to ACAP/ Northeast
Bank. Govt. Exh. 22-3. It also listed a false amount of $92,791 on line 19, for “Employee benefit
programs,” which are benefits paid to employees that would be added to the payroll calculation
for the PPP loan. The wages amount reflected on the Form 940 was $713,420, which more closely
matched the average monthly payroll figure the defendant provided on the loan application.12

11 A partnership’s payroll amount would have included any partner’s net earnings reflected on the
K-1 of the 1065 tax return, as indicated on the SBA Form 2483. Govt. Exh. 22-6 at p. 6. HM
Management did not report any net earnings (on either the real or the falsified tax returns).

12 The defendant argues that the 1065 tax return was neither requested nor reviewed by Cross River
Bank because the 1065 tax return was not referenced on one version of the “UW” notes record,
Defense Exhibit D. What the Cross River Bank notes suggest is that the salaries and wages, plus
employee benefits reflected on the 1065 income tax return would have yielded a loan above
$150,000 (approximately $189,197), and that the wages figure on the Form 940 more closely
matched the loan amount requested on the loan application of $148,592. It does not mean that the
income tax return, Form 1065, was not requested or reviewed.
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 19 of 28

The false income tax return also corroborated HM Management’s claim that it was in the
construction business, instead of being in the real estate business, as reflected on the real tax return
prepared by Mr. Cupersmith. Tr. 12/5/23 PM, at 45-46, 60-61; Govt. Exhs. 22-3, 29-3, 22-1 (Cross
River Bank portal application listing types of businesses considered ineligible for PPP loans,
including businesses owned by developers and landlords, and owners of shopping centers, with
defendant’s acknowledgement). As noted above, in 2021, the SBA Form 2483 directed the
applicant to list the business code from its income tax return. Govt. Exh. 22-6, at 6.
Not only did Mr. Lord testify that Cross River Bank requested HM Management’s 1065
tax return based on the type of business and how it filed its taxes, Cross River Bank initiated a
process to verify the tax return by providing the defendant an IRS Form 4506-T to execute with
the other closing loan documents. Govt. Exh. 22-6. The IRS Form 4506-T granted Cross River
Bank access to the defendant’s IRS-filed income tax return information for HM Management. Tr.
12/5/23 PM, at 68, 116, 125-26; Govt Exh. 22-6. The defendant executed the IRS Form 4506-T
that Cross River Bank provided, which was filled in to request HM Management’s 1065 tax return
information from the IRS for tax years 2019 and 2020. Govt Exh. 22-6, at pp 18-19. The falsified
tax return the defendant submitted to Cross River Bank was for tax year 2020. IRS records
indicated that, as of June 2022, the defendant had not filed HM Management’s real 1065 tax return
for tax year 2020, even though Mr. Cupersmith’s firm prepared that tax return in December 2021.
Govt Exhs. 12-4, 29-3. As for HM Management’s 2019 1065 tax return, which was filed with the
IRS, Mr. Cupersmith testified that his firm prepared it and he signed it, as was the case for all of
the defendant’s business and personal tax returns for the past 20-25 years. Tr. 12/12/23, at 63, 72;
Govt. Exh. 29-2. Had Cross River Bank turned to the IRS for verification, it would have received
tax return information from the HM Management 2019 tax return with Cupersmith’s signature.
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 20 of 28

Similar to the evidence about Alafaya Trails’ PPP application to ACAP/ Northeast Bank,
the evidence at trial established that the information the defendant reported about HM Management
regarding payroll and employees was false, and that the documents the defendant submitted in
support of the loan application to Cross River Bank were falsified. HM Management did not have
employees, or pay wages or employee benefits in 2020, the year for which the defendant reported
payroll figures to Cross River Bank. Govt. Exhs. 12-4, 12-5, 12-6, 16-1, 29-3, 29-10, 29-12.13
Mr. Cupersmith testified that his firm did not prepare and he did not sign the 2020 income tax
return for HM Management that the defendant submitted to Cross River Bank. Mr. Cupersmith
also testified that he did not authorize the defendant or anyone on the defendant’s behalf to use his
name, his PTIN or his business in this manner. Tr. 12/12/23 AM, at 90-92; Govt. Exh. 22-3.

Mr. Lord testified that had he received information that the 1065 income tax return for HM
Management had false information regarding salaries and wages, and that the accountant’s
signature had been forged, Cross River Bank would not have approved the loan. Tr. 12/5/23 PM,
at 63, 125.
B.
The evidence in this case supporting the Aggravated ID Theft counts satisfies Dubin.
In Dubin, the Supreme Court reversed the Fifth Circuit’s decision upholding an aggravated
identity theft conviction that involved the use of a Medicaid patient’s number on an inflated claim
for reimbursement for psychological services. Id. at 115-17. The psychological services were
performed on the Medicaid patient whose number was used on the claim. The claim, however,
was false because the qualifications of the psychologist performing the services were
misrepresented in order to justify an upcharge, and not because of anything having to do with the

13 Business records the defendant provided to Cupersmith’s firm to prepare the HM Management
2020 tax return showed wages in the amount of $2456, not $815,358. Govt. Exhs. 29-10, 29-12.
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 21 of 28

use of the Medicaid patient’s identity. Id. at 115. The Supreme Court in Dubin held that the words
“use” and “in relation to” in Section 1028A should not be construed so that the statute would
“apply automatically any time a name or other means of identification happens to be part of the
payment or billing method used in the commission of a long list of predicate offenses.” Id. at 117.
Instead, “using a means of identification in relation to a predicate offense requires ‘a genuine nexus
to the predicate offense.’” Id.
The Supreme Court explained that:
On this reading, the means of identification is at the crux of what makes the
predicate offense criminal, rather than merely an ancillary feature of a payment
method. When the underlying crime involves fraud or deceit, as many of § 1028A’s
predicates do, this entails using a means of identification specifically in a fraudulent
or deceitful manner.

Id. After referring to the dictionary definition of “identity theft,” the Supreme Court went on to
state that,
These definitions refer to offenses built around what the defendant does with the
means of identification in particular. In other words, the means of identification
specifically is a key mover in the criminality.

Id. at 122-23. Finally, the Court analyzed “uses” of another person’s means of identification “in
relation to” predicate offenses involving “fraud or deceit crimes,” and stated that “with fraud or
deceit crimes like the one in this case [health care fraud], the means of identification specifically
must be used in a manner that is fraudulent or deceptive. Id. at 131-32. Dubin requires, in fraud
cases, a showing that there was fraud or deceit “about identity.” See Dubin, 599 U.S. at 126.

The government has restated the language of Dubin here because the defendant has
misstated it as requiring that the use of the means of identity be “the crux” of what makes the
offense criminal, and “the key mover” of the criminality, instead of being “at the crux” of what
makes the underlying offense criminal or being “a key mover” of the criminality. The reason
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 22 of 28

Dubin vacated the defendant’s conviction is that he did not misuse the identities in a fraudulent or
deceptive way. The patients got the services.
The Eleventh Circuit’s opinion in United States v. Gladden, 78 F.4th 1232, 1244 (11th Cir.
2023) helps illustrate the point. The case involved a three-year health care fraud conspiracy with
ten defendants. The Court did not ask whether Linton’s misuse of several doctor’s names was the
crux of a multi-year, ten-defendant conspiracy, but rather whether her misuse was at the crux of
what made her health care fraud conspiracy criminal. Linton misrepresented by whom certain
prescriptions were authorized (by, among other ways, changing signed prescriptions to add
additional expensive medications). Her use of the doctor’s means of identification was fraudulent
because she falsely represented that he had authorized additional prescriptions. That her fraud
involved other misrepresentations (such as the reason why the medication was being prescribed,
i.e., they were medically unnecessary) does not mean her misrepresentation about identity was
ancillary to the fraud. “Linton’s use of Dr. Almirol’s identity was central to the deception: she
used his ‘means of identification itself to defraud or deceive.’” Id. at 1245-46.14
By contrast, the Eleventh Circuit held that co-defendant Gladden’s aggravated identity
theft conviction—for having his employee, Whitten, go to a doctor to get an unneeded prescription
in her daughter’s name—must be vacated because his “use of Whitten’s daughter’s identifying
information was merely ancillary to the deception.” Gladden, 78 F.4th at 1248. The prescriptions
at issue were signed by a “buddy” doctor and were written to real people, like Whitten’s daughter,

14 Similarly in Carter v. United States, 2024 WL 20847 (11th Cir. Jan. 2, 2024), the Eleventh
Circuit upheld the aggravated identity theft conviction for Carter, who used students’ identifying
information by falsifying enrollment forms to make it appear as if they were enrolled at his school
(which in fact they were not) and that way, the school could continue to receive state funding. The
Court found that Carter’s use of the students’ names and information was “at the crux” of what
made the scheme fraudulent. Id. at *8.

Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 23 of 28

so there were not any misrepresentations about identity.15 Id.
In this case, contrasted with Dubin, the means of identification of the accountant, Neal
Cupersmith, was stolen and used in the commission of the underlying scheme to defraud. The
defendant argues in effect that Mr. Cupersmith’s name was a superfluous addition to a false
document that was neither requested nor reviewed as part of the approval process for these loans.
The defendant argues that neither Mr. Toye nor Mr. Lord themselves had personal knowledge
regarding what loan documents were reviewed and that their respective bank’s records do not state
definitively that the income tax return was in fact a document the bank relied on to approve the
loan.
The bank witnesses testified about the process their respective banks had in place to review
PPP loan applications, and what these banks requested as supporting documents for the loan
applications. During the trial, and in his motion, the defendant simply refuses to accept the lender
witnesses’ testimony and records showing that the income tax return was requested, required, and
reviewed in their process. For instance, Northeast Bank’s guidance tool (Exh 20-3) listed the
income tax return as something to be requested and reviewed. As for Cross River Bank, while the
“application flow” that Mr. Lord spoke about was not preserved or produced, the Bank had the
defendant execute an IRS Form 4506-T that authorized the Bank to specifically request from the
IRS the applicant’s 2019 and 2020 income tax return information for verification. The tax returns
provided payroll information (consisting of salaries and wages, employee compensation, and net

15 The Court suggested that its holding might have been different, however, had Gladden “forge[d]
the name of the prescribing doctor on the prescription” or “misrepresent[ed] who would be
receiving the filled prescription.” Id. at 1249. In those circumstances, the deception at the heart
of his conduct not only would involve obtaining medically unnecessary prescriptions, but also
misrepresenting who was writing or receiving the prescriptions.

Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 24 of 28

earnings of a partner), which was the driver of the loan amount for any PPP loan. They also
corroborated other aspects of the business that the defendant misrepresented on the applications,
such as the type of business the applicant was engaged in, which would have rendered the
defendant’s companies ineligible for PPP loans. And as to Alafaya Trails, the requisite 25%
revenue decrease to qualify for a second draw loan. The income tax return, among the documents
requested, obviously provided the most comprehensive financial picture of the business.
The defendant’s use of Mr. Cupersmith’s identity is not the conduct that Dubin held fell
outside the scope of the aggravated identity theft statute. The defendant used Mr. Cupersmith’s
identity in a manner that was fraudulent or deceptive. The defendant stole Mr. Cupersmith’s
identity – his name, signature, PTIN, business name, EIN - to represent the income tax returns as
documents prepared and signed by him. It was at the crux of what made the defendant’s conduct
criminal: submitting false information with false supporting documents about his businesses,
particularly regarding payroll, in order to qualify for the loans. The defendant submitted to both
banks false 1065 tax returns and false Forms 940 that contained annual wages/ annual payroll
figures from which the average monthly payroll amount could be calculated. The income tax
returns contained other false information that was important, if not disqualifying, to the application
process as well: the type of business (business code) of the applicant company and, in the case of
Alafaya Trails, the revenue decrease that made it eligible for a second draw from Northeast Bank.
Mr. Cupersmith was not a name that was superfluous to those documents or to the fraud; because
Mr. Cupersmith was listed as the preparer, the tax returns and the misrepresentations they
contained supporting the loan application, were represented as Mr. Cupersmith’s work product.
In this way, the defendant’s use of Mr. Cupersmith’s identity was like Linton’s use of the doctor’s
identity to claim the prescriptions were authorized by the doctor. Gladden, 78 F.4th at 1245-46.
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 25 of 28

The case of United States v. Fullerton, 2023 WL 6150782 (W.D. Tx. Sept. 20, 2023) is
factually similar to this case. In that case, the defendant “engaged in a fraudulent scheme with
other conspirators to apply for and receive Payroll Protection Program (PPP) loans during the
COVID-19 pandemic.” Id. at *1. In short, the defendant “used fraudulent documents to support
the loan applications, including fraudulent lists of employees and fraudulent tax documents.” Id.
In one instance, he created fake tax records to attach to the fraudulent loan applications he
submitted and forged the signature of a CPA to indicate it had been prepared by a tax preparer. Id.
The district court found this allegation survived Dubin because the defendant used the
name and signature of a certified public accountant on fake tax records “to lend credibility to
fraudulent loan applications.” Id. at *4. That action, the court found, “legitimized the loan
applications and increased the likelihood that they would be approved by the appropriate financial
institutions.” In other words, the court held, he used the identity “in a manner that is fraudulent
and deceptive.” “[I]t is hard to identify a clearer allegation of identity theft.” Id.
By contrast, in United States v. Noble, ___ F. Supp. 3rd ___ (N.D. Ga. 2024), 2024 WL
253623 (N.D. Ga. Jan. 23, 2024), the court arrived at the opposite result in a COVID-19 loan fraud
case. The case illustrates, in a loan fraud-type context, when the use of a means of identification
may be covered by Dubin and when it is not. In Noble, the court held that the factual basis in the
defendant’s guilty plea was insufficient to sustain a conviction for aggravated identity theft, post-
Dubin, even though the defendant and a co-conspirator submitted fraudulent COVID-19 loan
applications using other people’s names as the applicants. Id. at *1. As to the specific loan
application that was the subject of the aggravated identity theft, the court found that whether the
loan application was successful hinged, not on the applicant’s identifying information, but on her
business records. Id. at *4. Importantly, the court noted that Noble did not forge the applicant’s
Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 26 of 28

name or misrepresent who the applicant was, or misrepresent whether the applicant was the person
receiving the loans. Id. The court cited with approval this Court’s Sheppard decision from October
31, 2023, denying Sheppard’s motion to dismiss the aggravated identity theft counts. Id. at *5.
The court noted that “Sheppard supports Noble’s position that the other person’s knowledge or
consent precludes conviction for aggravated identity theft.” Ultimately, the court found that the
defendant could not be guilty of identity theft if he has not stolen anyone’s identity. Id.
The defendant here stole Mr. Cupersmith’s identity and used it in a deceptive manner, as
Dubin requires. The defendant conveyed to the banks that this document they requested – the
income tax return – with (false) payroll figures, revenues, business type, was the work of Neal
Cupersmith, when in actuality, the figures had been falsified, Mr. Cupersmith’s signature had been
forged, and the tax return was the work product of the defendant. The defendant’s use of Mr.
Cupersmith’s identity was at the crux of what made the conduct criminal: the materially false
representations about his businesses. The jury had evidence from which to draw a reasonable
inference that using Mr. Cupersmith’s identity on the income tax returns was also important to the
defendant’s scheme as it conveyed to the lenders that the figures reported on the tax returns were
reliable. A reasonable jury could find, and did find from the evidence, that the defendant’s use of
Cupersmith’s identity was at the crux or a key mover in his fraud scheme to deceive the lenders
and the SBA into approving and funding loans the defendant knew he was not entitled to receive.
CONCLUSION

For the reasons set forth above, the government respectfully requests that the defendant’s
motion for judgment of acquittal as to Counts 5, 7, 8, 9, 13, and 14 of the Superseding Indictment
be denied.

Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 27 of 28

Respectfully submitted,

MARKENZY LAPOINTE

UNITED STATES ATTORNEY

By: s/Aimee C. Jimenez

Aimee C. Jimenez

Assistant United States Attorney

Court No. A5500795

99 N.E. 4th Street

Miami, Florida 33132-2111

Tel: (305) 961-9028

Fax: (305) 530-7976

Email: aimee.jimenez@usdoj.gov

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that on February 23, 2024, I electronically filed the foregoing

document with the Clerk of the Court using CM/ECF.

s/Aimee Jimenez
Aimee C. Jimenez
Assistant United States Attorney

Case 1:22-cr-20290-BB Document 214 Entered on FLSD Docket 02/23/2024 Page 28 of 28

File and source

File: gov.uscourts.flsd.615773.214.0.pdf
Size: 346,170 bytes
SHA-256: df7b9f679fafc2480df37e47fb22cc34e67685655292e3e7e76a94f8c55cb482
Our copy: gov.uscourts.flsd.615773.214.0.pdf
Original: PACER (login required)

Response in Opposition by USA as to Eric Dean Sheppard — USA v. Sheppard (Dkt. 214, S.D. Fla.)

Record facts

Full text

File and source

Related records