Indictment — United States v. Russell Foreman and Chandler Simbeck (D. Colo.)

Record facts

U.S. District Court for the District of Colorado · No. 1:21-cr-00165-WJM · Doc. 1 · 2021-05-18 · Docket on CourtListener

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IN THE UNITED STATES DISTRICT COURT 
FOR THE DISTRICT OF COLORADO 
Case No.  
UNITED STATES OF AMERICA, 
Plaintiff, 
v. 
1.
RUSSELL FOREMAN and
2.
CHANDLER SIMBECK,
Defendant. 
INDICTMENT 
The Grand Jury charges: 
COUNTS 1-7 
1.
At all times material to this indictment, the United States Small Business
Administration ("SBA") was an executive branch agency of the United States 
government. The mission of the SBA was to maintain and strengthen the nation's 
economy by enabling the establishment and viability of small businesses and assist in 
the economic recovery of communities after disasters. As part of this effort, the SBA 
enabled and provided for loans through banks and other lenders. These loans had 
government backed guarantees. 
2.
The Coronavirus Aid, Relief, and Economic Security ("CARES") Act was
a federal law enacted in or around March 2020 and was designed to provide 
emergency financial assistance to Americans suffering the economic effects caused by 
the COVID-19 pandemic. The CARES Act authorized the SBA to issue loans to small 
businesses and non-profit entities experiencing revenue loss due to the pandemic. 
21-cr-00165-RM
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3.
One form of assistance was the Economic Injury Disaster Loan ("EIDL
loan") program, which provided loan assistance for certain businesses negatively 
affected by the COVID-19 pandemic. To qualify for an EIDL loan, a business had to, 
among other requirements, be in operation prior to February 1, 2020. 
4.
Applicants for EIDL loans used the SBA online portal to submit their
application materials. The SBA servers that processed the EIDL loan applications were 
based in the state of Iowa. 
5.
Applicants had to certify that the information in the application was true
and correct, under the penalty of perjury and applicable criminal statutes. The 
application process involved filling out data fields relating to the size and ownership of 
the affected business entity, and other information about the relevant business for the 
12 months prior to COVID-19 impacting the national economy, such as the number of 
employees in the business, the gross business revenues realized, and the cost of 
goods sold. This information, submitted by the applicant, was then used by SBA 
systems to calculate the amount of money the applicant was eligible to receive.  
Additionally, applicants were asked questions about their criminal history to include 
whether they were convicted of a felony within the last 5 years. 
6.
Non-profit applicants and non-agricultural for-profit applicants were both
generally eligible to receive an EIDL loan of up to $150,000, with a 30-year scheduled 
repayment, deferred for 12 months. 
7.
In conjunction with the submission of an EIDL application, by simply
clicking on and checking a box within the online application, an applicant could request 
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and then receive up to $10,000 in an EIDL Cash Advance Grant based on the number 
of employees claimed.   
8.
Any funds paid by the SBA under an EIDL loan were processed and
issued from the state of Colorado and sent to the applicant borrower's financial 
institution. 
9.
Pursuant to the provisions governing the EIDL program, loan proceeds
could only be used by the affected business receiving EIDL loans for certain 
permissible expenses. The loans could be used by the business to pay fixed debts, 
payroll, accounts payable, and other bills that could have been paid had the COVID-19 
disaster not occurred. 
10.
Another form of assistance provided by the CARES Act was the
authorization of United States taxpayer funds in forgivable loans to small businesses 
for job retention and certain other expenses, through a program referred to as the 
Paycheck Protection Program ("PPP"). 
11.
To obtain a PPP loan, a qualifying business was required to submit a
PPP loan application, signed by an authorized representative of the business. The 
PPP loan application required the small business, through its authorized 
representative, to acknowledge the program rules and make certain affirmative 
certifications to be eligible to obtain the PPP loan.1  In the PPP loan application, the 
small business, through its authorized representative, was required to provide, among 
1
The authorized representative of the applicant was required to affirm that “The [PPP 
loan]funds will be used to retain workers and maintain payroll or make mortgage interest 
payments, lease payments and utility payments,” and that the “loan proceeds will be used only 
for business-related purposes as specified in the loan application” and consistent with PPP rules. 
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other things, its average monthly payroll expenses and number of employees.2  These 
figures were used to calculate the amount of money the small business was eligible to 
receive under the PPP. In addition, businesses applying for a PPP loan were required 
to provide documentation showing their payroll expenses. 
12.
PPP loan applications were processed by a participating financial
institution. If a PPP loan application was approved, the participating lender funded the 
PPP loan using its own monies, which were 100% guaranteed by the SBA. Data from 
the application, including information about the borrower, the total amount of the loan, 
and the listed number of employees, was transmitted by the lender to the SBA in the 
course of processing the loan. 
13.
PPP loan proceeds could only be used by the business on certain
permissible expenses, such as payroll costs, interest on mortgages, rent and utilities. 
The PPP allowed the interest and principal on the PPP loan to be entirely forgiven if the 
business spent the loan proceeds on the allowable expenses within a designated 
period of time and used a certain percentage of the PPP loan proceeds towards payroll 
expenses.   
14.
Between at least March 29, 2020 and October 6, 2020, RUSSELL
FOREMAN devised and intended to devise a scheme and artifice to defraud and to 
2
The authorized representative of the applicant was also required to certify that “the 
information provided in this application and the information provided in all supporting 
documents and forms is true and accurate in material respects,” and “I understand that if the 
funds are knowingly used for unauthorized purposes, the federal government may hold me 
legally liable, such as for charges of fraud.”  
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obtain money by means of materially false and fraudulent pretenses, representations, 
and promises made to the SBA in EIDL and PPP applications. 
15.
In furtherance of the scheme, on or about March 30, 2020, a false and
misleading EIDL application in the name of RUSSELL FOREMAN was electronically 
submitted to the SBA.  The application listed RUSSELL FOREMAN as the owner, was 
electronically certified by RUSSELL FOREMAN, and the information provided was 
certified as true and accurate.  The application contained materially false information 
concerning the lack of a criminal record of the applicant.  As a result of the application, 
on or about April 16, 2020, the SBA funded RUSSELL FOREMAN with a $1,000.00 
EIDL Cash Advance Grant. 
16.
In furtherance of the scheme, on or about May 14, 2020, a false and
misleading PPP application in the name of RUSSELL FOREMAN was submitted to 
Kabbage Inc., a PPP loan application processor and approved SBA lender of PPP 
loans located in Atlanta, Georgia.  It was electronically signed by RUSSELL FOREMAN 
on May 21, 2020, and the information provided as well as supporting documents and 
forms were certified as true and accurate.    As a result of the application, on May 26, 
2020, Cross River Bank, an FDIC insured bank located in Fort Lee, New Jersey and an 
approved SBA lender of PPP loans, funded RUSSELL FOREMAN with a $20,052.00 
PPP loan. 
17.
In furtherance of the scheme, on or about June 18, 2020, a false and
misleading EIDL application in the name of ECS Consulting LLC was electronically 
submitted to the SBA.  The application listed RUSSELL FOREMAN as the owner, was 
electronically certified by RUSSELL FOREMAN, and the information provided was 
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certified as true and accurate.  The application contained materially false information 
concerning the establishment date of the company, the gross revenues and costs of 
goods sold, and the lack of a felony criminal record of the applicant.  As a result of the 
application, the SBA funded ECS Consulting LLC with a $10,000.00 EIDL Cash 
Advance Grant on or about June 23, 2020 and an EIDL of $35,500.00 on or about June 
26, 2020. 
18. 
In furtherance of the scheme, on or about June 26, 2020, a false and 
misleading EIDL application in the name of Grand Luxury Marketing was electronically 
submitted to the SBA.  The application listed RUSSELL FOREMAN as the owner, was 
electronically certified by RUSSELL FOREMAN, and the information provided was 
certified as true and accurate.  The application contained materially false information 
concerning the establishment date of the company, the gross revenues and costs of 
goods sold, and the lack of a felony criminal record of the applicant.  As a result of the 
application, on or about August 31, 2020 the SBA funded Grand Luxury Marketing with 
an EIDL of $150,000.00. 
19. 
In furtherance of the scheme, on or about June 26, 2020, a false and 
misleading EIDL application in the name of Quantum Boost Technology was 
electronically submitted to the SBA.  The application listed RUSSELL FOREMAN as 
the owner, was electronically certified by RUSSELL FOREMAN, and the information 
provided was certified as true and accurate.  The application contained materially false 
information concerning the establishment date of the company, the gross revenues and 
costs of goods sold, and the lack of a felony criminal record of the applicant.  The 
application was not funded by SBA. 
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20. 
In furtherance of the scheme, on or about June 28, 2020, a second false 
and misleading EIDL application in the name of Quantum Boost Technology was 
electronically submitted to the SBA.  The application listed RUSSELL FOREMAN as 
the owner, was electronically certified by RUSSELL FOREMAN, and the information 
provided was certified as true and accurate.    The application contained materially 
false information concerning the establishment date of the company, the gross 
revenues and costs of goods sold, and the lack of a felony criminal record of the 
applicant.  The application was not funded by the SBA. 
21. 
On or about the dates specified as to each count below, RUSSELL 
FOREMAN, in the District of Colorado and elsewhere, for the purpose of executing 
the aforesaid scheme  and artifice to defraud, and attempting to do so, did 
knowingly transmit and cause to be transmitted, by means of wire, radio, and 
television communication, writings and signals in interstate commerce: 
Count 
Date  
Description of Interstate Wire 
 
1 
 
April 16, 2020 
Electronic transfer of $1,000.00 EIDL Cash 
Advance Grant from SBA in Denver, CO to Navy 
Federal Credit Union account xxxxxx9426, held 
in the name of Russell R. Foreman. 
2 
May 21, 2020 
Russell Foreman PPP loan application 
electronically signed and submitted in 
Colorado and routed interstate through 
servers outside Colorado. 
 
3 
 
June 23, 2020 
Electronic transfer of $10,000.00 EIDL Cash 
Advance Grant from SBA in Denver, CO to 
Bank of the West account xxxxx6416, held in 
the name of ECS Consulting LLC and 
controlled by Russell Ray Foreman. 
 
4 
 
June 26, 2020 
Electronic transfer of $35,400.00 EIDL from 
SBA in Denver, CO to Bank of the West 
account xxxxx6416, held in the name of 
ECS Consulting LLC and controlled by 
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Russell Ray Foreman. 
5 
August 31, 2020 
Electronic transfer of $149,900.00 EIDL 
from SBA in Denver, CO to FirstBank 
account xxxxxx1558, held in the name of 
Grand Luxury Marketing and controlled by 
Russell Ray Foreman. 
6 
June 26, 2020 
Quantum Boost Technology EIDL 
application submitted in Colorado and 
routed interstate through servers outside 
Colorado. 
7 
June 28, 2020 
Quantum Boost Technology EIDL 
application submitted in Colorado and 
routed interstate through servers outside 
Colorado. 
All in violation of Title 18, United States Code, Section 1343. 
COUNTS 8-11 
22.
On or about the dates set forth below, in the State and District of
Colorado, and elsewhere, RUSSELL FOREMAN, did knowingly engage and 
attempt to engage in a monetary transaction, as defined in Title 18, United States 
Code, Section 1957(f)(1), in criminally derived property of a value greater than 
$10,000.00, which was derived from a specified unlawful activity, that is, wire fraud 
(a  violation of Title 18, United States Code, Section 1343). 
Count 
Date 
Financial Transaction 
8 
September 1, 
2020 
Unnumbered check in amount of $60,000.00 
from FirstBank account xxxxxx1558, held in the 
name of Grand Luxury Marketing and controlled 
by Russell Ray Foreman, payable to Russell 
Foreman was deposited into Navy Federal 
Credit Union account xxxxxx8829, held in the 
name of Russell R. Foreman. 
9 
September 1, 
2020 
Unnumbered check in amount of $80,000.00 
from FirstBank account xxxxxx1558, held in the 
name of Grand Luxury Marketing and controlled 
by Russell Ray Foreman, payable to Mellissa 
Irish was deposited into Navy Federal Credit 
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Union account xxxxxx3025, held in the name 
Melissa M. Irish. 
10 
October 19, 2020 
Debit Card transaction in amount of 
$10,251.95 at Monarch Casino Black Hawk 
from Navy Federal Credit Union account 
xxxxxx9426, held in the name of Russell R. 
Foreman. 
11 
October 20, 
2020 
Debit Card transaction in amount of 
$10,295.00 at Isle Casino Black Hawk from 
Navy Federal Credit Union account 
xxxxxx9426, held in the name of Russell R. 
Foreman. 
 
All in violation of Title 18, United States Code, Section 1957. 
 
COUNT 12 
  
23.  
Paragraphs 1 – 13 are realleged.  
 
 
24. 
Between in or about June 2020 and on or about December 7, 2020, in the 
State and District of Colorado and elsewhere, RUSSELL FOREMAN and CHANDLER 
SIMBECK, did knowingly and voluntarily  conspire and agree together and with each 
other to defraud the United States and any agency thereof.  
MANNER AND MEANS OF THE CONSPIRACY 
25. 
Acting interdependently, the defendants, carried out the conspiracy using 
the following manner and means: 
 
A.   
The defendants assisted each other in creating an entity named 
Fusion Group. 
 
B. 
The defendants assisted each other in Fusion Group making an 
application with the SBA for an EIDL. 
 
C. 
The proceeds received from the approval of the loan by the SBA 
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were shared by the defendants. 
OVERT ACTS 
26.
In furtherance of the conspiracy’s objectives, one or more of the
conspirators committed one or more of the following acts in the State and District of 
Colorado and elsewhere: 
A.
On or about June 2020, RUSSELL FOREMAN and CHANDLER
SIMBECK  caused the issuance of an Employer Identification Number (EIN) by the 
United States Internal Revenue Service for Fusion Group listing CHANDLER SIMBECK 
as the Sole Member.  
B.
On June 25, 2020, RUSSELL FOREMAN emailed CHANDLER
SIMBECK with the subject line ‘Fusion Group’ and attached two documents titled:  (1)  
‘Chandler’s EIN.pdf’ – A letter from the Internal Revenue Service dated June 25, 2020 
to Fusion Group / Chandler E Simbeck Sole Mbr with notification that an Employer 
Identification Number (EIN) has been assigned to Fusion Group; and 2)  ‘Chandler’s 
LLC.pdf’ – The Articles of Organization of Fusion Group which had been filed with the 
Colorado Secretary of State on June 25, 2020 with a recorded principal office address 
of 1555 South Havana Street, Unit F #210, Aurora, Colorado 80012; an address used 
by RUSSELL FOREMAN. 
C.
On or about June 27, 2020, RUSSELL FOREMAN and
CHANDLER SIMBECK caused an EIDL application in the name of Fusion Group to be 
submitted to the SBA listing the owner as CHANDLER SIMBECK.  Fusion Group’s 
address was listed as 1555 South Havana Street, Unit F #210, Aurora, Colorado 80012.  
The application contained materially false information concerning the establishment 
date of the company, the gross revenues and costs of goods sold. 
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D.
On or about June 28 and June 30, 2020, CHANDLER SIMBECK
forwarded to RUSSELL FOREMAN emails from SBA confirming the status of the EIDL 
application in the name of Fusion Group. 
E.
On or about August 24, 2020, CHANDLER SIMBECK emailed
RUSSELL FOREMAN with the subject line ‘vegisvir articles of incorperation’ and 
attached a document titled ‘vegisvir_test.pdf’.  The body of the email was blank. The 
document attached to the email was a copy of the Articles of Organization for Vegisir 
Consults LLC. This document was ultimately filed with the Colorado Secretary of State 
on or about August 28, 2020. 
F.
On or about August 28, 2020, RUSSELL FOREMAN and
CHANDLER SIMBECK caused two entities named Vegisir Consults LLC and Vegvisir 
Consults LLC to be formed and registered with the Colorado Secretary of State.  For 
both companies, CHANDLER SIMBECK was listed as the Registered Agent and Person 
Forming the Limited Liability Company. 
G.
On August 27, 2020, the Fusion Group EIDL was approved by the
SBA and $149,900.00 was deposited into a First National Bank of Pennsylvania held in 
the name of Fusion Group LLC and controlled by CHANDLER SIMBECK.  Between 
August 31 and September 1, 2020, following the deposit of the funds into the Fusion 
Group LLC bank account, CHANDLER SIMBECK caused funds to be withdrawn from 
the account via: 1) a $8,000.00 check that was cashed; 2) a $30,000.00 check payable 
to Vegvisir Consults LLC that was deposited to a PNC Bank account held in the name 
of Vegvisir Consults LLC and controlled by CHANDLER SIMBECK;  3) a $60,000.00 
check payable to Vegisir Consults LLC that was deposited to a Citizens Bank account 
held in the name of Vegisir Consults LLC and controlled by CHANDLER SIMBECK; and 
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4) a $50,000.00 check payable to an individual identified herein as E.L., a relative of 
CHANDLER SIMBECK.   
 
 
H. 
On October 6, 2020, RUSSELL FOREMAN and CHANDLER 
SIMBECK caused a $55,000.00 wire transfer from Citizens Bank account in the name of 
Vegisir Consults LLC to be made to the account of RUSSELL FOREMAN at Navy 
Federal Credit Union.  
 
All in violation of Title 18, United States Code, Section 371.  
COUNT 13  
 
27. 
Paragraphs 1 – 13 are realleged.  
  
28. 
Between on or about June 2020 to August 31, 2020, RUSSELL 
FOREMAN and CHANDLER SIMBECK devised and intended to devise a scheme and 
artifice to defraud and to obtain money by means of materially false and fraudulent 
pretenses, representations, and promises made to the SBA in an EIDL application. 
  
29. 
In furtherance of the scheme, on or about June 25, 2020, records creating 
the entity Fusion Group were submitted to the Colorado Secretary of State.  The 
principal office address for Fusion Group was the same address listed in other records 
submitted to the Colorado Secretary of State by RUSSELL FOREMAN as addresses of 
businesses he operated.    
  
30. 
In furtherance of the scheme, on or about June 27, 2020, a false and 
misleading EIDL application in the business name of Fusion Group, naming CHANDLER 
SIMBECK as the owner, was electronically submitted to the SBA.  The application was 
electronically certified by CHANDLER SIMBECK and the information provided was 
certified as true and accurate.  The application contained materially false information 
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concerning the establishment date of the company, the gross revenues and costs of 
goods sold.  As a result of the application, in August 2020, the SBA funded Fusion 
Group with an EIDL in the amount of $150,000.00. 
  
31. 
On or about August 31, 2020, RUSSELL FOREMAN and CHANDLER 
SIMBECK,  in the District of Colorado and elsewhere, for the purpose of executing the 
aforesaid scheme and artifice to defraud, and attempting to do so, did knowingly 
cause to be transmitted, by means of wire, radio, and television communication, 
writings and signals in interstate commerce, to wit: proceeds of an EIDL of 
$149,900.00 was electronically sent from SBA in Denver, Colorado to the account of 
Fusion Group LLC at the First National Bank of Pennsylvania, outside of Colorado. 
All in violation of Title 18, United States Code, Sections 1343 and 2. 
NOTICE OF FORFEITURE 
 
32. 
The allegations contained in Counts 1 through 13 of this Indictment hereby 
are re-alleged and incorporated by reference for the purpose of alleging forfeiture 
pursuant to the provisions of Title 18, United States Code, Sections 981(a)(1)(A), 
981(a)(1)(C), and Title 28, United States Code, Section 2461(c). 
 
33. 
Upon conviction of one or more of the violations alleged in Counts 1 
through 7, 12, and 13, as such counts apply to each individual defendant, of this 
Indictment involving the commission of violations of Title 18, United States Code, 
Sections 1343 and 2 , the defendants RUSSELL FOREMAN and CHANDLER 
SIMBECK shall forfeit to the United States, pursuant to Title 18, United States Code, 
Section 981(a)(1)(C), and Title 28, United States Code, Section 2461(c), any and all 
rights, title, and interest in all property constituting and derived from any proceeds he 
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obtained directly and indirectly as a result of such offense or offenses or shall be liable 
for a money judgment in the amount of the proceeds that he obtained as a result of the 
scheme charged in Counts 1 through 7, 12, and 13 of this Indictment. 
34.
Upon conviction of one or more of the violations alleged in Counts 8
through 11 of this Indictment involving the commission of violations of Title 18, United 
States Code, Sections 1957, the defendant RUSSELL FOREMAN shall forfeit to the 
United States, pursuant to Title 18, United States Code, Section 981(a)(1)(A), any and 
all rights, title, and interest in all property involved in such offense or offenses, or 
property traceable to such property or shall be liable for a money judgment in the 
amount of the proceeds that he obtained as a result of the offenses charged in Counts 8 
through 11 of this Indictment. 
35.
If any of the property described above, as a result of any act or omission
of RUSSELL FOREMAN and CHANDLER SIMBECK, cannot be located upon the 
exercise of due diligence; has been transferred or sold to, or deposited with, a third 
party; has been substantially diminished in value; or has been commingled with other 
property that cannot be divided without difficulty, it is the intent of the United States, 
pursuant to Title 28, United States Code, Section 2461(c), incorporating Title 21, United 
States Code, Section 853(p), to seek forfeiture of any other property of RUSSELL  
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FOREMAN and CHANDLER SIMBECK up to the value of the forfeitable property 
described above. 
A TRUE BILL: Ink signature on file in Clerk’s Office 
 FOREPERSON 
MATTHEW KIRSCH 
Acting United States Attorney 
By: s/Robert Brown 
ROBERT BROWN 
Assistant U.S. Attorney 
U.S. Attorney’s Office 
1801 California St., Ste. 1600 
Denver, CO 80202 
Telephone: 303-454-0100 
Fax:  303-454-0401 
E-mail:  robert.brown5@usdoj.gov
Attorney for Government
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