McLean Man Pleads Guilty in COVID-19 Fraud Scheme — Mehdi Pazouki, Systems Integration Services Inc., $455,000 in PPP Loans and EIDL Funds

Summary

A release published 2024-02-23 states that Mehdi Pazouki pleaded guilty to defrauding the Small Business Administration by fraudulently obtaining approximately $455,000 in Paycheck Protection Program loans and Economic Injury Disaster Loan funds. It states that Pazouki was the owner and sole employee of Systems Integration Services Inc. and, between August 2020 and August 2021, falsely certified that the money would be used for business purposes. According to the release, Pazouki spent over $27,000 of EIDL money at Hollywood Casino in Charles Town, West Virginia, and used funds for real estate down payments and personal credit card debt. The release states that sentencing is scheduled for May 24, that the maximum penalty is 20 years in prison, and it cites Case No. 1:24-cr-29.

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ALEXANDRIA, Va. – A McLean man pleaded guilty today to defrauding the Small Business Administration by fraudulently obtaining approximately $455,000 in Paycheck Protection Program (PPP) loans and Economic Injury Disaster Loan (EIDL) funds.
According to court documents, Mehdi Pazouki, 65, was the owner and sole employee of Systems Integration Services Inc., an IT consulting company that Pazouki ran from his home in McLean. Between August 2020 and August 2021, Pazouki applied for and received approximately $455,000 in PPP loans and EIDL funds, which he falsely certified would be used for business-related purposes, but which he actually intended to, and did, use to fund his gambling at area casinos, pay down personal debt, and purchase real estate.
Within days of receiving his first EIDL disbursement, Pazouki spent over $27,000 in EIDL money at Hollywood Casino in Charles Town, West Virginia. Pazouki also used the PPP and EIDL money for down payments on two different real estate properties, to pay off his personal credit card debt, and to fund his personal investment account. Pazouki also falsely represented to the SBA in loan forgiveness applications that the PPP money had been used for legitimate business expenses, which resulted in the complete discharge of the loans.
Pazouki is scheduled to be sentenced on May 24. He faces a maximum penalty of 20 years in prison. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia; David J. Scott, Special Agent in Charge of the FBI Washington Field Office Criminal Division; and Duane E. Townsend, Special Agent in Charge of the U.S. Department of Commerce, Office of Inspector General, made the announcement after Senior U.S. District Judge Claude M. Hilton accepted the plea.
Assistant U.S. Attorney Lauren Halper is prosecuting the case.
A copy of this press release is located on the website of the
U.S. Attorney’s Office
for the Eastern District of Virginia. Related court documents and information are located on the website of the
District Court
for the Eastern District of Virginia or on
PACER
by searching for Case No. 1:24-cr-29.

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