Court filing

Defendant's Sentencing Memorandum — United States v. Alexander Barabash (D. Md.)

Filed June 12, 2023 in U.S. v. Barabash; one of 10 filings from this case.

Record facts

Court	U.S. District Court, District of Maryland
Filed	2023-06-12

U.S. District Court, District of Maryland · No. 1:22-cr-00232-JKB · Doc. 23 · 2023-06-12 · Docket on CourtListener

Full text

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
(Northern Division)
____________________________________

UNITED STATES OF AMERICA
:

v.
:
No. 1:22-cr-232-JKB

ALEXANDER BARABASH,

:
:

Defendant.

____________________________________:

DEFENDANT’S SENTENCING MEMORANDUM

Pursuant to 18 U.S.C. § 3553(a), Rule 32 of the Federal Rules of Criminal Procedure, the
United States Sentencing Guidelines (“U.S.S.G.”), and this Court’s Regular Sentencing Order
(D.E. 21), Defendant Alexander Barabash, through undersigned counsel, submits his Sentencing
Memorandum.
INTRODUCTION

Alexander Barabash was born in Kiev, Ukraine, and his family fled the Soviet Union when
he was a child. With a small amount of money and little more than the clothes on their backs, Mr.
Barabash’s family came to the United States to be free and to give Mr. Barabash and his sister the
best opportunity to succeed. Mr. Barabash became a United States citizen in 1984 and through
hard work and perseverance, lived the American dream. After working as a carpenter for ten years,
he entered the business of constructing and renovating homes and buying and selling real estate.
As a result of his hard work, his company, iDesignBuild, was recognized with numerous home
design awards and achieved an exceptional customer service rating. Under Mr. Barabash’s
leadership, iDesignBuild employed numerous independent contractors and its operations indirectly
employed numerous subcontractors and suppliers in the industry.
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 1 of 32

During the COVID-19 pandemic, iDesignBuild — and the home construction industry in
general — faced economic ruin. Business came to a complete stop and manufacturing supplies
were frequently unavailable or on back order. Financial obligations to independent contractors and
suppliers, however, remained constant. To keep iDesignBuild afloat, Mr. Barabash, with a high
school degree and a few college credits, applied for a loan from M&T Bank under the Paycheck
Protection Program (“PPP”). Shortly thereafter, M&T Bank’s Vice President for Business
Banking, Peyton Morin, advised Mr. Barabash that his initial loan request was below what he
should have requested. Mr. Barabash quickly made an amended request, but it was denied because
the prior loan had already been approved and processed.
When the time came for a second draw of funding, Mr. Barabash mistakenly relied on the
assistance of his accountant and tax preparer, Stanley Beers of Beers Tax and Accounting, to
ensure that his loan request was not lower than it should have been. Mr. Beers provided Mr.
Barabash with documents that grossly exaggerated iDesignBuild’s yearly earnings and number of
workers. Faced with the loss of his business, Mr. Barabash submitted the documentation provided
to him, even though he knew full well that the information was inaccurate and that the related
documents for W-2 employees were erroneous, particularly with regard to the withholding of
employment taxes. This was not the first time that Mr. Barabash submitted forms indicating W-2
employees, when he had independent contractors, in order to obtain funding during the pandemic.
As it applied to the second draw, to the extent that iDesignBuild was ever entitled to any PPP loan
funds as an employer of independent contractors, the amount would have been significantly lower
than the money received.
Notwithstanding the differences in iDesignBuild’s applications, the loans were approved
and Mr. Barabash used the PPP funds to keep his company afloat and to pay his independent
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 2 of 32

contractors, subcontractors, and suppliers during the economic downturn. He also used the money
to grow his business. Given the company’s ineligibility and its use of funds for business
expenditures outside the very limited authorized purposes, Mr. Barabash was aware that an audit
review would not have permitted forgiveness of the loan. Consequently, he considered the funds
to be a loan that would have to be paid back in four years. For him, it kept his company afloat and
he anticipated that he would be able to pay the loan back in full in four years.
For these actions, Mr. Barabash’s life turned into a nightmare. He will be a convicted felon,
a mark that he will carry with him for the remainder of his life and that will affect all of his future
business dealings in the industry. Mr. Barabash will be forced to give up the civic rights that he
and his family fled the Soviet Union to obtain. He has surrendered his Maryland home builder’s
license and will be subjected to a large restitution/forfeiture judgment, even after agreeing to forfeit
certain personal real property to lower his eventual financial obligation. Most importantly, Mr.
Barabash faces a lengthy period of incarceration for his first non-traffic related offense, which
could remove him from his family and all those he currently supports, including members of his
fiancée’s family, who were just able to get visas to the United States and leave war-torn Ukraine,
and who will be living with and supported by Mr. Barabash at his home in Arizona. Facing this
uncertainty, Mr. Barabash has been working around the clock to meet his financial obligations,
and to support his partner’s actions in rescuing her family from Russian aggression in Ukraine,
just as Mr. Barabash and his family did forty-four years ago. As the Court observed at his plea
hearing, Mr. Barabash was moved to tears, not because of the fear of incarceration, but because of
the shame that he has brought to his father, who did so much to give him the life he has now.
Upon notice of the Government’s investigation and the inception of this case, Mr. Barabash
has immediately accepted responsibility for his actions. He has been in 100% compliance with his
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 3 of 32

release conditions, and has not requested additional discovery or required the Government to file
a single motion during the pendency of this case. Mr. Barabash has also expressed his willingness
to be interviewed as to his dealings with Stanley Beers, his accountant who drafted and signed
false documents, and his communications with Peyton Morin, the M&T Bank Vice President who
encouraged him to apply for a larger loan amount, both of which could easily be the subject of
additional investigation by the Government.1 To date, no such meeting has been scheduled.
The nature of the specific transactions at issue in this case and the significant mitigating
facts and circumstances relating to Mr. Barabash, along with the sentences other courts have
imposed on similar defendants for far more egregious conduct, highlight why a sentence of more
than three years is wholly inconsistent with the statutory factors and the interests of justice. Even
a cursory review of the applicable Sentencing Guidelines in this case — such as, the exorbitant
enhancement for an offense involving a bank, when the money distribution and loan were approved
by the Government and the draconian increase based simply on the amount of the loan —
establishes why a three-plus-year prison sentence (in the midst of criminal justice reform seeking
to move away from mass incarceration) for a person who made a terrible mistake during a
pandemic does not serve the interests of justice.2

1 As discussed herein, infra at 23-26, the Government has prosecuted individuals who have aided
others in the preparation and filing of false PPP loan applications based on false supporting
financial and tax documents. Similarly, the Department of Justice is beginning to examine the
actions of lenders to evaluate their culpability in PPP related fraud. See JD Supra, Up Next: Lenders
May
Be
the
Next
Government
Focus
for
PPP
Fraud
(Feb.
17,
2023),
https://www.jdsupra.com/legalnews/up-next-lenders-may-be-the-next-3913257/, last visited June
12, 2023.

2 The Attorney General, Merrick Garland has promised to work to reform the criminal justice
system and end mass incarceration and was quoted in April 2021 as stating that this “means
revamping charging policies to give prosecutors discretion to make charges and consequent
sentences proportional to the crime and the damage it does.” See CNN Press Report,
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 4 of 32

For all these reasons, Mr. Barabash asks this Court to allow him to remain in the
community, to continue to repay his financial debts, and to provide for his family and Ukrainian
refugees, rather than be subjected to a lengthy period of incarceration with the Federal Bureau of
Prisons (“BOP”), which will diminish his ability to meet his financial obligations and remove him
from a family who cares deeply for him and depends greatly upon his assistance.
FACTUAL BACKGROUND
Personal Life and Work Experience

Mr. Barabash was born in Kiev, Ukraine in 1970. When he was nine, Mr. Barabash, his
parents, his sister, and his paternal grandparents immigrated to the United States. The family
sought to begin a new life in this country and specifically in the State of Maryland. Mr. Barabash
embraced his new country and became a United States citizen in 1984, and he still recalls receiving
a small American flag to hold during his naturalization ceremony. The Barabash family was a
traditional, middle-class household, and Mr. Barabash grew up with the support of two loving
parents and an older sister (see Ex.1). Photographs of Mr. Barbash’s family are below:

Although he did not speak English when he first arrived in the United States, Mr. Barabash
tested out of the third grade and worked hard in school. Starting at the age of fifteen, Mr. Barabash

https://www.cnn.com/2021/04/14/politics/merrick-garland-justice-police-daunte-
wright/index.html, last visited June 12, 2023.
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 5 of 32

worked several jobs to save money for his education, such as a bartender, waiter, line cook, and
night janitor for a bank. After graduating from Towson Catholic High School, he enrolled in
classes at the University of Massachusetts at Amherst and Towson University. Eventually, he
obtained a three-year carpentry apprenticeship and began working as a general carpenter. Over
time, Mr. Barabash developed his craft and formed a successful business that constructed and
renovated homes and bought and sold real estate. Through his hard work and dedication, his most
recent company, iDesignBuild, was recognized throughout the Baltimore area, winning numerous
building design awards and having outstanding customer reviews.
As set forth in the Presentence Report (“PSR”), Mr. Barabash now resides in Scottsdale,
Arizona with his fiancée, Mariia Doroshenko, with whom he has been in a relationship for four
years. Also residing in the home are Mariia’s brother and his girlfriend, who recently were granted
visas due to the ongoing war in the Ukraine. Photographs of Mr. Barbash and Ms. Doroshenko are
below:

Ms. Doroshenko’s mother and father were also just granted visas, and they too will live
with Mr. Barabash and Mariia in Scottsdale. Once Mariia’s parents are in the United States at the
end of the month, Mr. Barabash plans to officially ask Mariia’s father for permission to marry her.
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 6 of 32

Mr. Barabash and Mariia are now raising two Harlequin Great Danes, who are about to turn one
year old, which keep them positive and optimistic for the future during this very challenging time
in their lives.

The letters of support from Mr. Barabash’s sister Marina and fiancée Mariia further attest
to the kind of person Mr. Barabash is:
Marina Barabash (Ex. 1)
I can characterize my brother as a gentleman; a man of his word that always does
what he says he is going to do. He is incredibly self-driven, dependable, realizable,
and responsible. . . . I am the older sister by eight years and have watched my
younger brother develop into an incredible human being that any sister would be
proud of. He is an enthusiastic creative designer, a brilliant builder who has devoted
almost three decades to his career. Always puts the needs of others before his own.
Rehabilitates weaknesses, praises strengths, and motivates individuals to be the best
version of themselves. . . . Over the years whenever our parents would go away for
a vacation my brother would be at their home the next day installing, repairing, or
building something so upon their return they would come home to a pleasant
surprise after their vacation. . . .

Mariia Doroshenko (Ex. 2)
The Pandemic put a great deal of stress on Alex to keep his company running. He
was not worried about himself; his primary concern was for the people that worked
for him and to make certain that everyone would continue to receive pay while this
unprecedented event continued to negatively develop. . . . In February 2021 Russia
invaded Ukraine, where my immediate family lives[.] . . . [A] sign of hope came in
the implementation of the Uniting for Ukraine program. Alex immediately owned
the responsibility to apply to the Department of Homeland Security as a sponsor so
that my younger brother and his girlfriend could leave the war crisis. After a long
and initiative-taking dedicated unwavering resolve on Alex’s part, my brother and
his girlfriend were able to safely arrive in the United States[.] . . . Helping my
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 7 of 32

mother and father out of the region has been more complicated. Alex has been an
integral part of this labyrinthine process. . . . After a very lengthy, grueling,
logistically challenging process my mother and father will finally be flying to the
United States[.] . . . I am grateful to Alex for his steadfast commitment, to God, and
to this great country of the United States of America for creating the opportunity to
make this possible, to save the lives of the people that I love dearly and cherish,
and to have our family finally reunited. . . . Alex is unlike anyone I have ever met.
He is a brilliant mind, one of the hardest-working people I have ever met, and treats
everyone with respect and kindness. Amazing friend, supportive brother, loving
son, and hopefully soon-to-be husband and father of our children.

In his own words (see Ex. 3), Mr. Barabash takes full responsibility and is extremely
remorseful for his conduct:
I worked half of my life to build something to be proud of only to see everything
cut down. I made a terrible mistake that I sincerely apologize for, a mistake that I
take full accountability for, a mistake I have been paying dearly for every day for
almost two years now. . . . I take full accountability, and I apologize for my actions.
I had a normal life before the pandemic; committed to my career, went out to dinner,
met with my family for lunch almost every Sunday, and now my entire world has
turned inside out. I was scared, scared for my business, scared for the wonderful
people that worked for and with me. Never would I have been in this situation had
this pandemic never occurred, but I stand by my word of full accountability. Now,
I am ashamed because so many people are counting on me, and I am letting them
all down. I am scared to be introduced to a world I know nothing about and people
that I have never interacted with in my entire life.

Since March 2023, Mr. Barabash has been employed with ReBath and Kitchens
(“ReBath”) located in Scottsdale, Arizona. See PSR, ¶ 60 (D.E. 22). While the home building
market is still recovering in Arizona, ReBath considers Mr. Barabash an integral part in the process
of growing their kitchen division and Mr. Barabash hopes to generate sufficient business and
commissions that will allow him to make timely and complete resolution of his financial
obligations following his sentencing in this case.
The Nature and Circumstances of the Charged Offense
As a result of the COVID-19 pandemic, iDesignBuild, and the home construction industry
in general, faced economic ruin. Although business halted to a complete stop and manufacturing
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 8 of 32

supplies were frequently unavailable or on back order, payments to independent contractors and
invoices from suppliers remained constant. Mr. Barabash, with a high school degree and a few
college credits, sought a PPP loan. On or about April 9, 2020, Mr. Barabash submitted to M&T
Bank (where he had banked since 2006 and where iDesignBuild’s business checking account was
located) an online PPP loan application. The loan application represented that iDesignBuild had
four employees and an average monthly payroll of $18,750. On April 23, 2020, a PPP loan of
$46,800 was credited to iDesignBuild’s business checking account, ending in M&T x3819.
Because iDesignBuild engaged independent contractors for various work-related matters, none of
the individuals who performed work for the company were IRS Form W-2 employees, and
iDesignBuild did not withhold payroll taxes for the individuals. These independent contractors,
therefore, did not qualify as employees for purposes of the PPP.
During the loan application process, M&T Bank’s Vice President for Business Banking,
Peyton Morin, advised Mr. Barabash that his initial loan request was below what he should have
requested. Believing he had lost out on approximately $50,000 worth of needed aid during the
pandemic, Mr. Barabash electronically submitted a corrected PPP loan application to M&T Bank
on behalf of iDesignBuild. The second application represented that iDesignBuild had seven
employees and an average monthly payroll of $38,777.60, and was for a $96,944 PPP loan. Mr.
Barabash submitted IRS forms signed by him and his tax preparer, Stanley Beers, despite knowing
that iDesignBuild had never filed 2019 IRS Forms 940 or 941 with the IRS, as iDesignBuild’s
employees were independent contractors and not W-2 employees. Ultimately, M&T Bank could
not process the second application because the initial loan had already been finalized.
On or about January 20, 2021, Mr. Barabash applied for a second draw of PPP funding for
iDesignBuild. The application represented that the company had 37 employees and an average
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 9 of 32

monthly payroll of $525,227, and a PPP loan of $1,295,000 was credited to M&T account x3819
on February 26, 2021. In support of the application, Mr. Barabash submitted additional IRS forms
signed by him and Mr. Beers, even though Mr. Barabash knew that his workers were not W-2
employees and the gross earnings had been overstated. As iDesignBuild was ineligible for any
PPP funds, the Government contends that any use of the funds in any capacity was inappropriate.
Notwithstanding, Mr. Barabash used the funds to pay his independent contractors, suppliers,
vendors, and other business expenses, even though many non-salary expenditures were not
permitted under the PPP program.
As discussed below, at the time the second PPP loan hit iDesignBuild’s bank account, the
account already had a balance of $350,000. Additional funds were continuously deposited by
iDesignBuild into the account during the period that followed. While there is no dispute that the
funds were intermingled and Mr. Barabash would not have been financially comfortable engaging
in business transactions without the PPP loans, only one transaction in the Statement of Offense,
made on April 30, 2021, included deposited PPP funds. That single transaction resulted in proceeds
that were subsequently deposited back into the operating account five days later. While not
negating criminal liability, it puts into perspective Mr. Barabash’s conduct when finding
appropriate comparators for sentencing.

In the weeks and months following the disbursement of the loan proceeds to M&T account
x3819, Mr. Barabash made several transactions from the account that were not PPP permissible
expenditures, such as:
•
March 10, 2021, check drawn in the amount of $15,000 to a Title Company for the
purchase of real property located at 7 Fila Way, Sparks Glencoe, Maryland 21152;
•
March 24, 2021, check drawn in the amount of $25,000 to a Title Company for the
purchase of real property located at 14044 Fox Hill Road, Sparks Glencoe, Maryland
21152;
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 10 of 32

•
April 2, 2021, check drawn in the amount of $10,500 to Auto Showroom for the
purchase of a 2016 Chevrolet Corvette;
•
April 12, 2021, check drawn in the amount of $36,000 to a Title Company for the
purchase of real property at 7 Fila Way, Sparks Glencoe, Maryland;
•
April 30, 2021, wire transfer in the amount of $435,000 to a Title Company as an
advance of funds toward the purchase of real property at 7 Fila Way, Sparks Glencoe,
Maryland (paid as security to proceed with the purchase of 7 Fila Way; with the funds
later transmitted back to M&T x3819); and
•
May 21, 2021, wire transfer in the amount of $170,867.88 to a Title Company for the
purchase of real property at 14044 Fox Hill Road, Sparks Glencoe, Maryland.

As part of its business, iDesignBuild bought, renovated, and resold property. The
Government claims that the April 2, 2021, check drawn in the amount of $10,500 to Auto
Showroom for the purchase of a 2016 Chevrolet Corvette was a gross misappropriation of funds,
but the vehicle in question was quickly refinanced, with the valuation above the purchase price,
and the proceeds of the refinancing, $83,900, were deposited back into iDesignBuild’s business
checking account with the PPP funds.

The PPP funds provided to iDesignBuild provided compensation to the various personnel
who performed services for the company in 2020 and 2021:
iDesignBuild Personnel — April 1, 2020

Alexander Barabash

Principal
Tivshintugs (Tony) Banzragch
Project Manager (Kitchen and Bath)
Larry Brown

Plumber (Boilers, Steam, Pluming and Gas)
Jeremy Richards

Electrician
Tomas Trojansky

Working Foreman
Filip Braun

Lead Carpenter
Guillermo Moran

Rough Carpentry/Framing
Camillo Williamson

Welding Shop Custom Rail/Stair Fabrication
Oscar Rayes

Painter
Rigeberto Guevara

Painter/Drywall
Saul Hernandez

Hardwood (Installation and Refinishing)
Melissa Williams

Website

iDesignBuild Personnel — January 1, 2021

Alexander Barabash

Principal
Tivshintugs Banzragch

Project Manager (Kitchen and Bath)
Larry Brown

Master Plumber (Boilers, Steamfitter, Plumbing/Gas)
Jonathan Johnson

Master Plumber (Plumbing/Gas)
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 11 of 32

Henry Hom

Electrician
Jeremy Richards

Electrician
Yee Hyun

Tile and Stone Installer
Tomas Trojansky

Working Foreman
Filip Braun

Lead Carpenter
Mike McGuire

Plumber (Plumbing/Gas)
Charles Redmiles

Lead Carpenter
Ron Baker

Mechanical
Roberto Martinez

Trim Carpenter/Custom Woodworker
Camillo Williamson

Welding Shop (Custom Rail/Stair Fabrication)
Guillermo Moran

Rough Carpentry/Framing
R. George Cochran

Generalist - Home Improvement
Luis Garcia

Generalist - Home Improvement
Dennis Paul Kratz

Carpenter
Rigeberto Guevara

Painter/Drywall
Vlad Risman

Drywall (Hanger/Finisher) and Painter
Oscar Rayes

Painter
Alex Golden

Network/Automation low voltage wiring
Brendon Miles

Lead Carpenter
Peter Sherratt

Wood Shop/Finish Carpentry
Shawn Lee

Exterior Mechanic; Siding and Gutters
Saul Hernandez Hardwood

Installation and Refinishing
Jay Hester

Hardwood and Tile Installation
Joseph Dicarlo

Tile Installation
Clint Lindemer

Generalist - Home Improvement
John Anderson

Hauling, Demolition, Project Clean Up
Raqub Salaam

Hauling, Project Clean Up
Matt Donohue

Carpenter General Helper
Matt Ogle

Carpenter General Helper
Melissa Williams

Website
Glenda Lizeth Reyes

Project Clean Up
Sergei Ivan Randazzo

Demolition/Project Clean Up

The PPP funds provided to iDesignBuild permitted it to meet additional financial
obligations to the following vendors, suppliers, and governmental entities in 2020 and 2021:
Amazon Business Prime
Appliances Connection
Atlantic Pest Control
Baltimore County Govt - Permits
Bison Drywall
Bobby’s Pottys
Budekes Paints and Stains
Build.com
Cabinet ERA
Capital Pro Lighting
Chesapeake Tile and Marble
Clifton HVAC
Coleman Home Improvement
Computer Kitchen Design
Custom Ink Products
Devere Insulation
eBay
E.L. Façade Masonry
ETSY
Everlong Pest Control
Fast Signs
Granite Bracket Direct
Hajoca Lee Dopkin Supply
Home Depot
Home Systems Appliance Repair
Hunt Valley Tile and Stone
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 12 of 32

Jones Valley Association
Lowes
Lynn Construction
Maryland Abatement
Maryland Department of Licensing
Michaels Irrigation Services
Mobtown Mechanical Plumbing/Gas
Mirror Crafters
Northwest Refuse Roll-off Services
NW2 Engineers
Ocean Mosaics Tile
Perry Hall Heating and Air Conditioning
Plumb Smart
Preller Properties
Prime Roofing
Property Inspection Pros
Sanitary Landfill
Sherwin Williams Stores
The Roofers of Maryland
Timonium North
TW Perry Lumber Yard
UHAUL
USA Distributor Cabinetry
VistaPrint
Wallace H. Campbell & Co.
Wave Carousel Automation and Integration
Wood Floors Plus

Though Mr. Barabash cannot deny that iDesignBuild received funds it was not entitled to
receive, the funds were used primarily to keep workers employed, to keep the business afloat, and
to grow the business’ property portfolio.3
ARGUMENT
I.
A SENTENCE BELOW THE GUIDELINES IS WARRANTED IN THIS CASE.

This Court need not send Mr. Barabash to prison, as the statute on which he will be
sentenced does not require a mandatory period of incarceration. Based on Mr. Barabash’s de
minimis criminal history, long ties to the community, willingness to forfeit personal property to
satisfy any financial judgment in this case, amenability to cooperating in any investigation of bank
employees and his former accountant, and demonstrated ability to maintain 100% compliance with
his release conditions during the pendency of this case, the Court should vary downward from the
Guidelines range and impose a three-year sentence of probation (to include, six months home

3 The same cannot be said for the thousands of law firms that received PPP funds in a legal market
that did not suffer significant declines as a result of the COVID-19 pandemic. See Law Firms That
Received PPP Loans, https://www.gerbenlaw.com/blog/law-firms-that-received-ppp-loans/, last
visited June 12, 2023 (noting that the Small Business Administration and the Treasury Department,
“[i]n order to provide transparency,” released data that “showcases all the businesses that received
more than $150,000 in PPP loans,” including a list of “the 14,363 law firms that received PPP
Loans, as well as the amount they were given and the jobs they reportedly retained”).
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 13 of 32

confinement and 200 hours of community service) and order a money judgment for the proceeds
of the loan received, less the $504,000 already seized by the Government and real property agreed
to be forfeited to satisfy any judgment.
A.
Sentencing Discretion and Section 3553(a) Statutory Factors.
The Guidelines are only advisory despite their mandatory language. See United States v.
Booker, 543 U.S. 220, 245 (2005). A district court must therefore “consider Guidelines ranges,”
but is permitted “to tailor the sentence in light of other statutory concerns as well.” Id. The Supreme
Court in Gall v. United States outlined the process to follow:
[A] district court should begin all sentencing proceedings by correctly calculating
the applicable Guidelines range. As a matter of administration and to secure
nationwide consistency, the Guidelines should be the starting point and the initial
benchmark. The Guidelines are not the only consideration, however. Accordingly,
after giving both parties an opportunity to argue for whatever sentence they deem
appropriate, the district judge should then consider all of the [18 U.S.C.] § 3553(a)
factors to determine whether they support the sentence requested by a party. In so
doing, he may not presume that the Guidelines range is reasonable. He must make
an individualized assessment based on the facts presented.

552 U.S. 38, 49-50 (2007) (emphasis added) (citations and punctuation omitted).
Thus, in fashioning an appropriate sentence, this Court must consider the Guidelines along
with the other factors set forth in 18 U.S.C. § 3553(a) (see Booker, 543 U.S. at 260; see also,
U.S.S.G.) and treat the Guidelines “as one factor among several” that § 3553(a) requires courts to
consider. See Kimbrough v. United States, 552 U.S. 85, 90 (2007).
Under 18 U.S.C § 3661, “[n]o limitation shall be placed on the information concerning the
background, character, and conduct of a person convicted of an offense which a court of the United
States may receive and consider for the purposes of imposing an appropriate sentence.” Further,
under 18 U.S.C. § 3582(a), the court, in considering the factors in § 3553(a) and their applicability,
should recognize “that imprisonment is not an appropriate means of promoting correction and
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 14 of 32

rehabilitation.” (Emphasis added.)
Although the Guidelines range will generally align with the objectives of the § 3553(a)
factors, that is not always the case. As the Supreme Court said in Kimbrough:
[I]n the ordinary case, the Commission’s recommendation of a sentencing range
will reflect a rough approximation of sentences that might achieve § 3553(a)’s
objectives. The sentencing judge, on the other hand, has greater familiarity with
the individual case and the individual defendant before him than the Commission
or the appeals court. He is therefore in a superior position to find facts and judge
their import under § 3553(a) in each particular case. In light of these discrete
institutional strengths, a district court’s decision to vary from the advisory
Guidelines may attract greatest respect when the sentencing judge finds a particular
case outside the heartland to which the Commission intends individual Guidelines
to apply.

552 U.S. at 109 (emphasis added) (citations and punctuation omitted).

As one district court has framed it, the Guidelines’ “most fundamental flaw is the notion
that the complexity of human character and conduct can be rationally reduced to some arithmetic
formula.” See Terry Carter, Rakoff’s Stance on the SEC Draws Fire, Praise—and Change: The
Judge Who Said No, ABA Journal, Oct. 2013, at 53.
B.
Applicable Sentencing Guidelines Range.
Mr. Barabash entered a guilty plea to Count One of the Indictment, which charges him with
wire fraud, in violation of 18 U.S.C § 1343. The parties agree that the Guidelines provision
applicable to this offense is U.S.S.G. § 2B1.1(a)(1), which begins with a base offense level of 7
and, with Mr. Barabash being in Criminal History Category I, results in an applicable guidelines
range of 0 to 6 months, with Zone A, being probation eligible. The wire fraud statute is, however,
heavily driven by the actual loss amount, which indirectly drives the Government’s prosecution
of offenses for violations of the Payroll Protection Act. Here, even though $504,000 was sitting in
Mr. Barabash’s corporate checking account following the deposit of PPP funds and was
immediately seized by the Government, Mr. Barabash is responsible for the full loan amount under
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 15 of 32

the Guidelines, which raises his offense level fourteen levels to offense level 21, resulting in an
advisory guidelines range of 37 to 46 months.
Mr. Barabash’s offense level is subject to an additional upward adjustment and
enhancement because the money passed through a financial institution and its total was in excess
of $1,000,000 (again, even though $504,000 remained in the bank account and was seized by the
Government). As confirmed by DOJ’s own website devoted to its nationwide taskforce for the
devotion of Justice resources to the prosecution of PPP loan related offenses, it is the Government
that approves the loans, and the banks were merely the pass-through mechanism by which
Government funds were distributed to loan recipients:4

The upward adjustment and additional enhancement raises Mr. Barabash’s guidelines range to
offense level 23, and subsequently to offense level 24, based on a guidelines provision finding any
offense level below 24 insufficient. This is yet another upward adjustment, which is obvious
double counting based on the amount at issue and the involvement of a financial institution that
was merely a pass-through instrument for Government funds getting to the end recipient quicker.
With these various provisions, and after a three-level reduction for Mr. Barabash’s

4 DOJ Website, https://www.justice.gov/criminal-fraud/cares-act-fraud, last visited June 12, 2023.
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 16 of 32

immediate acceptance of responsibility, the final adjusted offense level is 21, with an advisory
guidelines range of 37 to 46 months. A sentence over three years of incarceration is wholly
inconsistent with the § 3553 sentencing factors.
C.
A Below-Guidelines Sentence is Appropriate in this Case.

District courts may impose a sentence below the Guidelines range through either a
“departure” or “variance.” See United States v. McKinnie, 21 F.4th 283, 289 (4th Cir. 2021). A
“departure” is typically a change from the final sentencing range computed by examining the
provisions of the Guidelines themselves. It is frequently “triggered by a prosecution request to
reward cooperation . . . or by other factors that take the case ‘outside the heartland’ contemplated
by the Sentencing Commission when it drafted the Guidelines for a typical offense.” United States
v. Rangel, 697 F.3d 795, 801 (9th Cir. 2012) (citation and punctuation omitted). “A ‘variance,’ by
contrast, occurs when a judge imposes a sentence above or below the otherwise properly calculated
final sentencing range based on application of the other statutory factors in 18 U.S.C. § 3553(a).”
Id. (citation omitted); see also USSG § 1B1.1(c). Here, through either a departure or variance, Mr.
Barabash should receive a sentence significantly below the applicable Guidelines range.
Mr. Barabash is by all accounts a kind-hearted, devoted man, with a family who loves and
supports him. See Exs. 1-3. He is not a violent person and poses no danger to society, as evidenced
by the Government’s willingness to let him live in the community for the past eighteen months
and to relocate to Arizona. Mr. Barabash’s only prior adjudication is for a traffic offense, which
resulted in a sentence of probation before judgment.5

5 Mr. Barabash provided records to United States Probation showing all the programs he undertook
as part of his probationary sentence for his prior traffic offense. Mr. Barabash completed all
requirements, including the Interlock requirement, as he otherwise would not have been able to
receive a valid Maryland license, which he did and maintained, up to and including, when he
relocated to Arizona. A copy of his valid Maryland license, issued after his traffic case was
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 17 of 32

Contrary to many PPP loan fraud cases, this is not a case where the monies were being
funneled to Mr. Barabash’s friends and family, unconnected to a legitimate business. Rather, the
evidence shows that the funds were used for business purposes, though not for the business
purposes contemplated by the PPP statute. Moreover, in this case, Mr. Barabash immediately
accepted complete responsibility for his actions, without filing a single motion or requesting
additional discovery from the Government. He also offered to debrief with the Government and
provide all information relating to his tax preparer’s preparation of erroneous financial documents,
as well as the specific M&T Bank officer who contacted him to tell him his loan application
appeared to be lower than it should be, but the Government has taken no action to schedule any
meeting with Mr. Barabash in this regard.
Just punishment has been imposed. Mr. Barabash will be saddled with a felony conviction
for the rest of his life. He will remain under supervision with strict conditions with the clear and
apparent reality of potential revocation even for the slightest of violations. As discussed below,
Mr. Barabash respectfully requests a sentence of three years’ probation, with a period of home
confinement, a lengthy community service order, and order of restitution, all of which serves the
interests of justice and which is sufficient, but not greater than necessary, to comply with the
statutory purposes of sentencing. See 18 U.S.C. § 3553(a). Given the facts of this case, just
punishment and deterrence have been provided for in the recommended sentence.

resolved, was provided to United States Probation. Additionally, Mr. Barabash previously sent
confirmation of completion of his Interlock requirement to the Maryland DMV and sought,
although was unsuccessful, to obtain another copy in preparation for sentencing in this case. There
is no factual basis to conclude that Mr. Barabash did anything else but fully comply with all the
necessary requirements to resolve his Maryland traffic case and his sentence of probation, as he
has done for every aspect of this case, and for every request made of him by United States
Probation.
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 18 of 32

1.
Kinds of Sentences Available.
A sentence of incarceration is not always necessary to satisfy the Sentencing Guidelines or
section 3553. Indeed, as observed by the district court in Gall, probation (or post-release
supervision), “rather than an act of leniency, is a substantial restriction of freedom.” 552 U.S. at
44 (punctuation omitted). The Gall Court emphasized that the defendant would have to “comply
with strict reporting conditions along with a [multi]-year regime of alcohol and drug testing.” Id.
The Court also noted that the defendant would “not be able to change or make decisions about
significant circumstances in his life, such as where to live or work, which are prized liberty
interests, without first seeking authorization from his Probation Officer or, perhaps, even the
Court.” Id.
This Court may also consider a sentence with a period of home detention, which has been
defined by the Guidelines as:
[A] program of confinement and supervision that restricts the defendant to his place
of residence continuously, except for authorized absences, enforced by appropriate
means of surveillance by the probation office. When an order of home detention is
imposed, the defendant is required to be in his place of residence at all times except
for approved absences for gainful employment, community service, religious
services, medical care, education or training programs, and such other times as may
be specifically authorized. Electronic monitoring is an appropriate means of
surveillance and ordinarily should be used in connection with home detention.
However, alternative means of surveillance may be used so long as they are as
effective as electronic monitoring.

U.S.S.G. § 5F1.2, Commentary, n.1.
Based upon the information contained in this submission, and given the mandate of
18 U.S.C. § 3553(a)(3) for the Court to consider “the kinds of sentences available,” a community
service order would also satisfy the goals of sentencing. A 2001 publication of the Administrative
Office of the United States Courts described community service as “a flexible, personalized, and
humane sanction,” which “offers a way for the offender to repay or restore the community.” Court
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 19 of 32

& Community: An Information Series About U.S. Probation & Pretrial Services: Community
Service, Office of Probation and Pretrial Services, Administrative Office of the U.S. Court (Feb.
2001), available at https://www.nhp.uscourts.gov/sites/nhp/files/ccservice.pdf, last visited June
12, 2023. It is “practical, cost-effective, and fair — a ‘win-win’ proposition for everyone
involved.” Id. It is also recognized that “[c]ommunity service addresses the traditional sentencing
goals of punishment, reparation, restitution, and rehabilitation. . . . It restricts offenders’ personal
liberty[,] . . . allows offenders to atone or ‘make the victim whole’ in a constructive way[, and] . . .
may be regarded as . . . a form of symbolic restitution when the community is the victim.” Id. In
selecting an appropriate candidate to perform community service, United States Probation
recommends as follows:
[C]ourts can use community service successfully with a wide spectrum of
offenders: corporations and individuals, first offenders and recidivists, the indigent
and the affluent, juveniles and senior citizens. Not every offender is a good
candidate for community service. . . . Courts look for offenders with personal and
social stability, who are willing, motivated, and who have no history of violence.
Id.
2.
Avoid Sentencing Disparities.
As discussed below, in this Court, individuals committing similar offenses received
significantly lower sentences than will be sought by the Government in this case. Moreover, in a
brief cursory review of published sentences nationwide, district court judges have pushed back on
Government requests for incarceration for PPP related wire fraud, and have sentenced defendants
to lengthy terms of supervision (with periods of home confinement) and appropriate restitution
judgments.

As it pertains to this jurisdiction, in United States v. Brandon Fitzgerald-Holley, No. 21-
cr-00250-GJH, the defendant used a non-operational nonprofit to obtain PPP funds, even though
the company had no employees, income, or regular operations. See Press Release,
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 20 of 32

https://www.justice.gov/usao-md/pr/nonprofit-ceo-pleads-guilty-wire-fraud-relation-covid-19-
loan-fraud, last visited June 12, 2023. After a prior loan application to the SBA had been denied,
the defendant created and submitted fraudulent documents, including an IRS Form W-3, which
falsely stated that the company had twenty-five (25) employees with total wages of $1,385,000.
As stated in his plea agreement, the defendant used the fraudulently obtained funds to purchase
personal items, including clothing, a pool table, televisions, electronic equipment, a 2020 Dodge
Charger, and various accessories for the vehicle; and to fund a vacation rental. In total, the
defendant misappropriated $305,854 in PPP loan funds. As the loan amount was lower than a
million dollars, the defendant’s advisory sentencing guidelines range was 21 to 27 months,
significantly lower than Mr. Barabash’s advisory guidelines range in this case, even though Mr.
Barabash did not use a defunct company and pocket the proceeds of the PPP funds for his personal
use, and did not seek the loan after another attempt for Government funding was futile. Even with
this conduct and a guidelines range of 21 to 27 months, the Court sentenced the defendant in
Fitzgerald-Holley to six months of incarceration.
In United States v. Dana Hayes, No. 22-cr-0224-GLR, the defendant made multiple
applications for PPP loans and Economic Injury Disaster (“EID”) loans for an inactive company,
based on false information as to revenue, employees, and activities, and also failed to disclose that
he was under supervision for a prior stolen gun possession conviction that made him ineligible for
the loan programs. The defendant was also the Chief of Fiscal Services with the Baltimore City
Police Department during the time of his conduct, but was fired after being put under supervision
for allegedly murdering his stepfather. Because the defendant only obtained $50,036, and even
though he transferred all the PPP funds from the corporate account where they were deposited to
his personal account, his offense level on the charge of wire fraud was only offense level 11, with
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 21 of 32

an advisory guidelines range of 8 to 14 months. Notwithstanding these facts and the defendant’s
prior criminal history, the Court sentenced the defendant to three years of supervised probation
and four weekends of intermittent confinement.
In United States v. Sherrie Bryant, No. 22-cr-00308-DLB, the defendant pled guilty to wire
fraud after submitting fraudulent PPP and EID loan applications for a business whose stated
purpose was to provide mentorship and education to underserved youth. The defendant repeatedly
misrepresented that she had never been convicted of a crime and ultimately obtained $419,100 in
fraudulent loans proceeds, which were used in part to pay for a car, a boat, a vacation, and tickets
to sporting events. The case represented the defendant’s third federal fraud conviction, and the
defendant was on federal supervised release at the time of her PPP fraud. Given the loss amount,
the defendant’s offense level conduct was only level 16, with an advisory guidelines range of 27
to 33 months of incarceration, due to her Category III criminal history score. Notwithstanding the
defendant’s lengthy criminal history and having committed the offense while on supervision for
another federal fraud conviction, the Court sentenced the defendant to twelve months on the
current wire fraud to run consecutive to six months for the violation of supervision.
This Court has also imposed non-incarceration sentences for non-dangerous, non-violent
theft offenses against the United States Government on numerous prior occasions:
• Leroy Kamzura, who engaged in federal employees’ compensation fraud and social
security fraud by obtaining benefits ($177,132) while failing to report active employment
for a period of seven years, was sentenced to one year of probation on home detention (18-
cr-0582-CCB);

• Frederick Kellner, who for nearly 27 years converted to his own use his father’s
retirement benefits ($356,577), was sentenced to five years of probation, including six
months of home detention (19-cr-0267-DKC);

• Craig Colbert, who for ten years converted his deceased father’s retirement benefits
($216,290) to his own use was sentenced to four years of probation, including nine months
of home detention (19-cr-093-GJH);
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 22 of 32

• Gloria Wilson, who improperly received her stepmother’s social security benefits for 17.5
years ($176,874), was sentenced to three years of probation, including eight months of
home detention and 100 hours of community service (15-cr-0633-CCB);

• Keisha Jones, who engaged in social security fraud by obtaining improper benefits
($145,044) for 20 years, was sentenced to three years of probation, including one year of
home detention (18-cr-0590-RDB);

Separate from decisions in this Court, as explained in detail below, district courts
nationwide have pushed back on the Government’s request for incarceration for offenses relating
to PPP fraud as part of DOJ’s focused national task force priority on prosecuting these offenses:
In United States v. Janet Jenison, Chief United States District Judge Algenon L. Marbley
in Columbus, Ohio sentenced the defendant to five years of probation, including six months of
home confinement, for multiple counts of wire fraud and making a false statement to law
enforcement relating to PPP fraud. The defendant submitted three fraudulent applications and
sought nearly $300,000 in federal PPP financing for a marketing business registered under her
maiden name. The defendant received approval on two applications totaling $160,247 in funding
after she submitted false payroll and other documentation. The defendant also created false bank
account statements for her business, showing withdrawals for payroll, tax withholding, and
business expenses, even though the business account was not open during the relevant period.
Further, the defendant submitted false tax documents, including one classifying her marketing
business as a corporation, when the employer tax identification number on the form was not created
until four months later. She also submitted documents falsely claiming she had made federal
employment tax deposits for employees when she had not. The Government sought a 21-month
prison term, plus fines and restitution, but the district court sentenced the defendant to probation
and home confinement (No. 2:21-cr-90, S.D. Ohio).
In United States v. Malik Breckenridge, the defendant applied for and obtained two PPP
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 23 of 32

loans on behalf of his purported business, which was not a registered business entity and was not
engaged in substantial or legitimate business activity. The defendant admitted that he falsely stated
that the company was established in 2014 and had been operating at the time the loans were sought.
The defendant further admitted that he submitted false IRS forms showing that the company had
earned $180,489 in gross income during 2019. The defendant was sentenced to five years of
probation, including eight months on home detention, on the sole count of wire fraud (No. 2:22-
cr-84,
S.D.
W.V.)
(https://www.justice.gov/usao-sdwv/pr/charleston-man-ordered-pay-
restitution-covid-19-relief-fraud-scheme).
In United States v. Tarshauna Thomas, the defendant, a BOP correctional guard, claimed
to be the sole proprietor of a dog breeding and sitting service, “Shaunas Little Pooches,” when
applying for two PPP loans. While approved for both PPP loans, she received payment from only
one lender. The payment was electronically deposited into the defendant’s personal bank account
and spent on personal, non-business-related expenses. The defendant was sentenced to three years
of federal probation and ordered to pay restitution (No. 3:22-cr-00086-DCB-FKB, S.D. Miss.)
(https://oig.justice.gov/news/press-release/former-bop-correctional-officer-pleaded-guilty-wire-
fraud-after-submitting-two);
(https://www.justice.gov/usao-sdms/pr/former-bop-correctional-
officer-sentenced-committing-covid-relief-fraud).
In United States v. David Andrew Butziger, the defendant assisted his codefendant in
applying for PPP loans for three restaurants that had no employees at all (and one of which his
codefendant had no ownership interest in at all). The defendant also submitted a PPP loan
application in his own name on behalf of an unincorporated entity that he called Dock Wireless.
The loan application was in the amount of $105,381.50 and fraudulently represented that Dock
Wireless had seven employees and an average monthly payroll of $42,152.60. In reality, the
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 24 of 32

company had no employees and no wages were ever paid. In total, the defendant and his
codefendant submitted four fraudulent PPP loans applications totaling $543,959. While the
applications were pending, a concerned citizen aware of their fraudulent nature brought them to
the attention of law enforcement, which ultimately led to the denial of their loan applications. The
defendant’s guidelines range was 21 to 27 months and the Government asked for a sentence of 21
months. The district court placed the defendant on three years of supervised release, the first six
months to be served in home confinement with electronic monitoring, and ordered the defendant
to pay a fine of $5,000. The defendant was on pretrial release during the entirety of the case and
his sentence was more akin to a sentence of probation than supervised release (No. 20-072-MSM,
D.R.I., D.E. 35 (Gov’t Sentencing Memorandum)) (https://www.justice.gov/usao-ri/pr/rhode-
island-man-sentenced-covid-19-related-fraud-scheme).
In United States v. Jeremy Sanders, et al., the defendants — husband and wife — were
sentenced to probationary sentences with brief periods of home confinement after they worked
with others to prepare and submit loan applications that misrepresented payroll for their purported
businesses and sole proprietorships. The businesses, in fact, had no employees and the PPP
applications were supported by false tax documents. Jeremy Sanders and an Omaha-based co-
conspirator submitted fraudulent applications for loans totaling approximately $41,290, and he
personally obtained $20,690. His wife, Lakeda Sanders, and a co-conspirator submitted fraudulent
applications for loans totaling approximately $220,000, and she personally obtained $24,166 (No.
21-cr-00253-RFR-SMB, D. Neb.) (https://www.justice.gov/usao-ne/pr/georgia-couple-sentenced-
paycheck-protection-program-fraud).
In United States v. Alexis Ransom, the defendant was sentenced to five years of probation
after fraudulently applying for three PPP loans for her purported business, Alexis Renae Ransom,
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 25 of 32

for which she claimed did business under the tradenames of Renae’s Fashion Consulting LLC and
Momma & Me Boutique. The defendant admitted that she falsely stated that Renae’s Fashion
Consulting LLC was established in 2019, and had earned $66,900 in gross income in 2019 and
2020, and that Momma & Me Boutique earned $69,000 in gross income in 2019. The investigation
revealed that the defendant’s purported business and its tradenames had not engaged in substantial
business activity before February 15, 2020. The defendant further admitted that she submitted a
false IRS form in connection with the first loan application she submitted for Renae’s Fashion
Consulting LLC (No. 2:22-cr-122, S.D.W.V.) (https://www.justice.gov/usao-sdwv/pr/logan-
county-woman-sentenced-covid-19-relief-fraud-scheme).
In each of these above-referenced cases, located in a quick Google search, the defendants
applied for PPP loans for which they were ineligible, for companies that did not exist, and the
proceeds were used exclusively for personal purposes. In all instances, the defendants did not serve
a day in jail. None of those predicate facts exist in this case and while the loan amount may have
been greater for Mr. Barabash, the PPP funds were primarily used for business-related costs and
expenditures (regardless of whether they were permissible under the PPP program). For the
Government to disregard these facts, and those cases, and ask for multiple years of incarceration
simply because the loan amount was higher, runs afoul of the purposes of sentencing and the
§ 3553 sentencing factors.
Similarly, districts courts throughout the country have not backed down from issuing non-
incarceration sentences for non-dangerous, non-violent offenses even when the Government
sought jail sentences, merely as a form of deterrence:
• Leonardo Silva, who, as a DEA Special Agent in Monterrey, Mexico, was prosecuted for
providing false information that caused two Mexican citizens to have their visas revoked
in exchange for post-retirement employment, as well as, submitting false financial
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 26 of 32

disclosure reports, was sentenced to two years of probation (No. 16-cr-69-TFH (D.D.C.
2017));

• Gloria Dickinson, who, as a FERC employee and elected Treasurer of Local 421 of the
American Federation of Government Employees, was prosecuted for embezzling $21,713
of federal-employee union funds and filing false reports with the Department of Labor to
cover it up, was sentenced to five years of probation (No. 12-cr-00197-BAH (D.D.C.
2012));

• Martin Lieb, who, as a DOD employee, was prosecuted for failing to disclose on his
financial disclosure form gifts — including a ticket to the Super Bowl, lodging on a cruise
ship, and meals and drinks — from a company that had secured DOD contracts worth
hundreds of millions of dollars, was sentenced to two years of probation (No. 1:10-cr-
00144-RBW (D.D.C. 2010));

• Courtney Stadd, who, as a former NASA Chief of Staff, was prosecuted for steering
millions of dollars of earmarked funds for a NASA initiative to benefit a university with
which she had a consulting agreement, thereafter, increasing her own consulting fees as a
result, was sentenced to three years of probation (No. 09-cr-65-RMC (D.D.C. 2009));

• Turab Lookman, who was prosecuted as a former scientist from Los Alamos National
Laboratory for making false statements regarding his involvement with a Chinese
government technology program — stating he had not been recruited by the Chinese
program when he in fact had — was sentenced to five years of probation (No. 1:19-cr-
01439-WJ (D.N.M. 2020));

• Andrew Siemaszko, who was prosecuted as an employee of a nuclear power station and
who made false statements to the Nuclear Regulatory Commission regarding the condition
and maintenance of equipment at the power plant, was sentenced to three years of probation
(No. 3:06-cr-00712-DAK-3 (N.D. Ohio 2009));

• Randall Barker, who was prosecuted for failing to report the full amount of income from
his business from 2011 to 2014, admitting to taking direct payments from customers,
removing cash from business deposits, and altering invoices to show less income for the
business, was sentenced to one year of probation (No. 18-cr-10152 (EFM) (D. Kan. Jul.
31,
2019))
(https://www.justice.gov/usao-ks/pr/flooring-store-owner-sentenced-tax-
evasion);

• Lawrence P. Stephenson, who was prosecuted for tax evasion, began diverting portions
of his practice’s business receipts by depositing checks from insurance carriers and patients
into a personal bank account, failed to report approximately $1.2 million dollars paid to his
dental practice and deposited it elsewhere, thus failing to pay taxes due the IRS, was
sentenced to three years of probation and 280 hours per year of community service (No.
18-cr-73 (D.R.I. Nov. 14, 2018)) (https://www.justice.gov/usao-ri/pr/north-providence-
dentist-sentenced-tax-evasion-0);

Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 27 of 32

• Ty Warner, who was prosecuted for failing to report more than $24.4 million in income,
and evading nearly $5.6 million in federal taxes from millions of dollars he hid for more
than a decade in secret foreign financial accounts at two banks based in Switzerland, was
sentenced to two years of probation (No. 13-cr-731 (CPK) (N.D. Ill. Jan. 14, 2014))
(https://www.justice.gov/usao-ndil/pr/h-ty-warner-sentenced-probation-after-paying-80-
million-taxes-and-penalties-tax-evasion);

• Jacques Wajsfelner, who worked in real estate and advertising, held a Swiss bank account
valued at over $5 million, and owed more than $400,000 in back taxes, interest, and
penalties, was sentenced to three months of home detention (No. 12-cr-641 (NRB)
(S.D.N.Y. Mar. 8, 2013));

• Josephine Bhasin, who had an account at HSBC in India that held a high balance of $8.3
million, and filed a false Report of Foreign Bank and Financial Accounts (“FBAR”) after
being contacted by the DOJ, was sentenced to two years’ probation, the first three months
to be served in home confinement, and 150 hours of community service (No. 11-cr-268
(ADS) (E.D.N.Y. Mar. 8, 2013));

• Arvind Ahuja, who was convicted in a jury trial of willfully filing a false return and
willfully failing to file an FBAR due to a failure to disclose more than $8.5 million held in
bank accounts at HSBC India, was sentenced to three years of probation, three months of
home detention, a $350,000 fine, and 450 hours of community service, after the court
varied from the Guidelines’ range of 41 to 51 months (No. 11-cr-135 (CNC) (E.D. Wisc.
Feb. 6, 2013));

• Lothar Hoess, the owner of a company that sold office supplies and equipment, who had
a tax loss of between $400,000 and $1,000,000, and faced a Guidelines’ range of 30 to 37
months, was sentenced to three years of probation (No. 11-cr-154 (SM) (D.N.H. Mar. 30,
2012));

• Arthur Joel Eisenberg, who was prosecuted for filing a false income tax return and failing
to report that he had an interest in or signature authority over financial accounts at UBS
AG, where at the end of 2004, the total balance of Eisenberg’s various UBS financial
accounts exceeded $3.1 million, was sentenced to three years of probation (No. 10-cr-
00369-JCC (W.D. Wash. Mar. 4, 2011));

• Harry Abrahamsen, who was prosecuted for failing to file a FBAR and concealing more
than $1 million in Swiss bank accounts, was sentenced to three years of probation,
including twelve months of home confinement with electronic monitoring (No. 10-cr-254
(D.N.J. May 24, 2011)) (https://www.justice.gov/opa/pr/new-jersey-ubs-client-sentenced-
failing-report-more-1-million-swiss-bank-account);

• Michael Reiss, who moved his offshore account to various institutions and countries,
failed to participate in the IRS’s offshore voluntary disclosure program, and filed false
FBARs, and faced a Guidelines’ range of 30 to 37 months, was sentenced to three years of
probation, the first eight months to be served in a community confinement center, and 30
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 28 of 32

hours of community service a week for three years (No. 11-cr-668 (RMB) (S.D.N.Y. Jan.
1, 2011));

• Ernest Vogliano, who opened UBS accounts in the names of Liechtenstein and Hong
Kong shell corporations, and actively used funds and transferred some after learning of the
criminal investigation, was sentenced to two years of probation (No. 10-cr-327 (TPG)
(S.D.N.Y. Apr. 26, 2011));

• Jules Robbins, who created a sham Hong Kong corporation to be listed as the nominal
holder of his UBS accounts that held nearly $42 million was sentenced to twelve months
of probation because the court took into consideration his “otherwise unblemished life”
(No. 10-cr-333 (RJH) (S.D.N.Y. Oct. 8, 2010));

• Paul Zabczuk, who instructed clients to make payments to him through undisclosed
accounts in Switzerland and the Bahamas was sentenced to three years of probation, twelve
months of home detention, and community service (No. 10-cr-60112 (WPD) (S.D. Fla.
July 26, 2010));

• John McCarthy, who transferred over $1,000,000 to an unreported Swiss bank account
and communicated with bank representatives to orchestrate various transactions, was
sentenced to three years of probation with six months of home detention and 300 hours of
community service (No. 09-cr-784 (VBF) (C.D. Cal. Mar. 22, 2010));

• Juergen Homman, who failed to disclose a Swiss account holding approximately $5
million, was sentenced to five years of probation and community service (No. 09-cr-724
(SRC) (D.N.J. Jan. 6, 2010));

• Steven Rubinstein, who hid approximately $7 million in unreported Swiss accounts that
he used to invest in real estate, was sentenced to three years of probation with twelve
months of home detention (No. 09-cr-60166 (MGC) (S.D. Fl. Oct. 28, 2009)); and

• Igor Olenicoff, a businessman and investor, who held more than $200 million in
undisclosed offshore bank accounts and owed $52 million in back taxes, interest, and
penalties, was sentenced to two years of probation (No. 07-cr-227 (CJC) (C.D. Cal. Apr.
16, 2008)).

II.
RESTITUTION, FORFEITURE, AND FINES.

At the plea hearing, the Government made clear that it was seeking a windfall in this case,
a money judgment for the remainder of the loan proceeds, and a separate forfeiture order for the
full amount of the loan, $1,295,000. Notwithstanding this Court’s admonitions that no such
multiple orders would be forthcoming as a matter of fundamental fairness and due process, the
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 29 of 32

Government’s
press
release
for
this
matter
following
the
plea
hearing
(https://www.justice.gov/usao-md/pr/baltimore-man-pleads-guilty-federal-charge-fraudulently-
obtaining-more-12-million-covid), and Mr. Barabash’s notice from the U.S. Treasury (which
appears to include both amounts) (attached hereto as Exhibit 4), appear to imply that the
Government is moving forward as if this Court had already issued both a restitution and a forfeiture
order. To avoid a windfall for the Government and consistent with other PPP fraud sentences
throughout the country, Mr. Barabash requests that he only be required to pay back the difference
in the loan amount after subtraction of the $504,869.54 already seized and with a credit afforded
for his agreement to forfeit his interest in property located at 14044 Fox Hill Road in Sparks
Glencoe, Maryland.6
III.
SENTENCING REQUEST AND RECOMMENDATION.
A term of probation or supervised release is determined by reviewing many of the same
§ 3553(a) factors already considered above, including, as relevant here: (i) the nature and
circumstances of the offense and the history and characteristics of the defendant; (ii) the need for
deterrence, to protect the public, and provide treatment to the defendant; (iii) the available
sentences and sentencing range; (iv) relevant policy statements by the Sentencing Commission;
and (v) the need to avoid sentencing disparities. See 18 U.S.C. § 3583(c). Accounting for these
factors, as addressed above, Mr. Barabash recommends a three-year period of supervision

6 Mr. Barabash, consistent with the Government’s agreement in its plea agreement not to ask for
the imposition of a fine in this case, also requests that the Court not impose upon him the obligation
to pay a fine, when he will have a large money judgement to satisfy in the years ahead, just had to
forfeit real property to satisfy the anticipated judgment, and will no longer be able to have rental
income from that property to subsidize his current intake as a consultant in the home development
field (especially after the forfeiting of his Maryland home improvement license). Contrary to U.S.
Probation’s conclusion, and consistent with the Government’s position, Mr. Barabash does not
have the ability to pay a fine in this case and a fine should not be imposed.
Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 30 of 32

including the “standard” conditions recommended by the Guidelines (see USSG § 5D1.3(c)). The
conditions of supervised release will significantly restrict Mr. Barabash’s liberty and provide a
daily reminder of his criminal conduct by requiring that he, among other things:
• regularly report to his probation officer;
• seek permission from the Court or his probation officer to leave Arizona;
• respond truthfully to questioning by his probation officer;
• live in an approved residence and notify his probation officer or any address change;
• allow his probation officer access to his residence;
• work fulltime and notify his probation officer of any job change;
• refrain from knowingly communicating with criminals;
• notify his probation officer if he is arrested;
• refrain from possessing a firearm or other dangerous weapons; and
• refrain from possessing illegal drugs or alcohol.

A three-year period of supervision, subject to these conditions, will serve the interests of
punishment and deterrence while allowing Mr. Barabash to remain a productive member of society
and giving him appropriate credit for his immediate acceptance of responsibility.7

7 To the extent that the Court believes incarceration is essential in this case and will not consider
home confinement or a sentence of numerous weekends at a local facility, Mr. Barabash
respectfully requests that he be permitted to self-surrender, which would allow the BOP to
appropriately designate him for assignment, thereby reducing his danger classification (which is
non-existent), and to do so in accordance with BOP’s facility availability. Mr. Barabash also asks
that he be designated at the lowest security classification facility near Scottsdale, Arizona so he
can be as close to family as possible.

Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 31 of 32

CONCLUSION

For the foregoing reasons and any others that may appear to the Court or that may develop
at the sentencing hearing, Mr. Barabash respectfully requests that this Court impose a sentence of
three years of probation, with a term of home confinement and community service.
Dated: June 12, 2023

Respectfully submitted,

/s/
Christopher Macchiaroli (Bar No. 21099)

Silverman Thompson Slutkin & White LLC
1750 K Street, NW, Suite 810
Washington, D.C. 20006
Telephone: (202) 539-2444
Facsimile: (410) 547-2432
cmacchiaroli@silvermanthompson.com

Counsel for Alexander Barabash

Case 1:22-cr-00232-JKB Document 23 Filed 06/12/23 Page 32 of 32

File and source

File: gov.uscourts.mdd.515239.23.0.pdf
Size: 748,054 bytes
SHA-256: 15c35ed6bb4083fc520095654b4e7e7d23109ab5f357933f8106105e1a6eff4c
Our copy: gov.uscourts.mdd.515239.23.0.pdf
Original: PACER (login required)

Defendant's Sentencing Memorandum — United States v. Alexander Barabash (D. Md.)

Record facts

Full text

File and source

Related records