Morrison Man Indicted for Covid Fraud

Summary

A U.S. Attorney's Office for the District of Colorado release dated February 24, 2023, announcing that Richard Rejan Nieto, age 37, formerly of Morrison, has been indicted on three counts of wire fraud and five counts of money laundering. According to the indictment, from April of 2020, through April of 2021, the defendant allegedly devised a scheme to defraud the United States and a lender, obtaining $913,551.88 in PPP loans and obtaining forgiveness of $176,956.09. The release says the defendant allegedly laundered money through large transfers between bank and investment accounts, including a $40,000 transfer to a cryptocurrency account in January 2021. The release names the Internal Revenue Service-Criminal Investigation (IRS-CI) as the investigating agency and gives case number 22-cr-00262.

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Full text

DENVER – The United States Attorney’s Office for the District of Colorado announces Richard Rejan Nieto, age 37, formerly of Morrison, has been indicted on three counts of wire fraud and five counts of money laundering for taking money that he received as a result of fraudulent Paycheck Protection Program (PPP) applications he submitted.
In late March 2020, the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act was enacted, and extended emergency financial assistance to millions of Americans suffering economic harm from the COVID-19 pandemic.  The CARES Act expanded existing Small Business Administration programs, including the Economic Injury Disaster Loan (“EIDL”) program, and established new temporary programs, including the Paycheck Protection Program (“PPP”).
According to the indictment, from April of 2020, through April of 2021, the defendant allegedly devised and participated in a scheme to defraud the United States and a lender. The defendant unjustly enriched himself by obtaining $913,551.88 in PPP loans. He obtained the loans by inflating payroll costs, making false statements and certifications, and submitting fake tax returns. Having unjustly obtained PPP loans, he then applied for loan forgiveness for the full amount of the PPP loans. He obtained forgiveness of $176,956.09 through false representations and by submitting fake payroll checks. He allegedly laundered money through large money transfers between bank and investment accounts, including a $40,000 transfer to a cryptocurrency account in January 2021, to purchase Bitcoin. The United States has previously executed seizures of fraud proceeds from the defendant’s E*Trade investment account and from two cryptocurrency trading accounts.
The charges contained in the indictment are allegations and the defendant is presumed innocent unless and until proven guilty.
The Internal Revenue Service-Criminal Investigation (IRS-CI) investigated this case. Assistant United States Attorneys Craig Fansler and Martha Paluch are handling the prosecution.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit
https://www.justice.gov/coronavirus
.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at:
https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form
.
Case number: 22-cr-00262

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