Information — United States v. Jonathan Olivetti (M.D. Pa.)

Summary

An Information in United States of America v. Jonathan Olivetti, Case 1:21-cr-00380-JPW, in the U.S. District Court for the Middle District of Pennsylvania, filed December 13, 2021 as Document 1. Count 1 charges wire fraud. The Information alleges that Olivetti, the sole employee of Olivetti Law, LLC, submitted PPP loan applications to Lender #1 in June 2020 and on or about January 19, 2021 that misstated the firm's monthly payroll, and that Lender #1 distributed approximately $20,800 for the second loan. It alleges that the object of the scheme included two PPP loans of approximately $20,800 each and two EIDL loans of approximately $62,500, and that the EIDL applications were not approved by the SBA. The Information names United States Attorney John C. Gurganus.

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          Case 1:21-cr-00380-JPW Document 1 Filed 12/13/21 Page 1 of 8




                   UNITED STATES DISTRICT COURT
                 MIDDLE DISTRICT OF PENNSYI,VANIA

UMTED STATES OF AMERICA
                                                      No. 3:
                    v

JONATHAN OLTVETTI

                               Defendant
                               INFORI\,IATION

THE UMTED STATES ATTORNEY CIIARGES:

                                      COUNIT 1
                                     Wire Fraud
                                   18 U.S.C. S 1343

I.   Introduction

     At times material to the Information:

                        Relevant               and Entities

     1.     Defendant JONATHAN OLIVETTI resided in or about

Philadelphia, Philadelphia County, within the Eastern District of

Pennsylvania.

     2.      Olivetti Law, LLC was a limited liability company

incorporated in the Commonwealth of Pennsylvania, with a business

address located in Philadelphia, Philadelphia County, within the

Eastern District of Pennsylvania. Olivetti Law, LLC was incorporated

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on or about October 3, 2013, and JONATHAN OLIVETTI was listed as

the sole orgarrrzer for Olivetti Law, LLC

      3.     OLIVtrTTI was the sole employee of Olivetti Law, LLC.

      4.     The United States Small Business Administration ("SBA")

was an executive branch agency of the United States government that

provided support to entrepreneurs and small businesses. The mission of

the SBA included maintaining and strengthening the nation's economy

by enabling the establishment and viability of small businesses and by

assisting in the economic recovery of communities after disasters. As

part of those efforts, the SBA enabled and provided for loans with

government-backed guarantees to small business owners through

financial institutions and other lenders.

     5.     Lender #1, was located in Fort Lee, New Jersey. It was one

of over 1,500 privately funded non-bank lenders approved by the SBA to

process Paycheck Protection Program ("PPP") loans.

                     The Pavcheck Protection Proqram

     6.     The Coronavirus Aid, Relief, and Economic Security

("CARES") Act was a federal law enacted in March 2O2O that provided

emergency financial assistance to millions of Americans suffering

financial difficulties from the economic impact of the COVID-19
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pandemic. One source of relief provided by the CARES Act was the

authorization of approximately $349 billion in forgivable loans to small

businesses, through the PPP. In April 2020, Congress authortzed an

approximate $310 billion of additional PPP funding.

        7.      PPP loan proceeds were authorized to be used for businesses'

employee payroll, mortgage interest, Iease, and utilities expenses. The

principal amount of and interest on a PPP loan was entirely forgivable if

the business spent the loan proceeds on those authorized expenses

within a designated period of time, and also spent a certain percentage

of the PPP loan proceeds on payroll expenses

        8.     To obtain a PPP loan, a qualifying business was required to

submit a loan application signed by an authortzed representative of the

business. The PPP loan application required the business (through its

authorized representative) to ackno'*,1edge the program rules and to

make affirmative certifications, in order to be eligible to obtain the PPP

Ioan.

        9.     In the PPP loan application, the applicant (through its

authorized representative) was required to state, among other things,

its: (a) average monthly payroll expensesi and (2) number of employees.

Those figures were used to calculate the amount of money that the
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        Case 1:21-cr-00380-JPW Document 1 Filed 12/13/21 Page 4 of 8



small business was eligible to receive through the PPP. An applicant

also was required to provide documentation showing its payroll

expenses.

      10. Although the SBA oversaw the PPP, PPP loan applications
were processed by participating lenders, including Lender #1, who

received and processed PPP loan applications and supporting

documentation. If a PPP application was approved, the participating

lender funded the PPP loan through its own monies, which were IOO%

guaranteed by the SBA. Data from the PPP loan 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 PPP loan.

              The Economic Iniunr Disaster Loan Program

     11. Another source of relief provided by the CARES Act was the
expansion of an existing disaster-related program - the Economic Injury

Disaster Loan ("EIDL") - to provide low-interest financing (including

forgivable $10,000 advances) to small businesses and other eligible

entities. The CARES Act authorized the SBA to provide EIDL loans to

eligible small businesses experiencing substantial financial disruption

resulting from the COVID-19 pandemic.
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        Case 1:21-cr-00380-JPW Document 1 Filed 12/13/21 Page 5 of 8




      12. To obtain an EIDL loan, a qualifying business was required
to submit an application directly to the SBA and provide information

about the business's operations, such as the number of employees, gross

revenues for the 12-month period preceding the disaster, and cost of

goods sold in the l2-month period preceding the disaster. In the case of

EIDL loans for COVID-l9 relief, the 12-month period was the l2-month

period from January 31, 2019, to January 31,2020. The applicant was

also required to certifir that all of the information in the application was

true and correct to the best of the applicant's knowledge

      13. EIDL loan applications were submitted directly to the SBA
and processed by the agency with support from a government

contractor. The amount of the loan, if the application was approved,

was determined based, in part, on the information provided by the

applicant about employment, revenue, and cost of goods sold. Any funds

issued under an trIDL loan were issued directly by the United States

Treasury.

      14. As a general matter, trIDLs carried interest rates of B.7b%
for for-profit corporations and 2.75%o for non-profit corporations. The

first payment on an EIDL loan was deferred for 12 months.

     15. EIDL proceeds could only be used to pay fixed debts, payroll,
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accounts payable and other bills that could have been paid had the

disaster not occurredi however, such loan proceeds were not intended to

replace lost sales or profits or for expansion of a business. Moreover,

EIDL proceeds could not be used to "[r]efinance indebtedness which you

incurred prior to the disaster event." 13 C.F.R. $ 123.303(b)(1).

II.   Object of the Scheme to Defraud

      16. The object of the scheme was for JONATHAN OLIVETTI to
enrich himself by fraudulently obtaining funds, including two PPP loans

of approximately $20,800 each and two EIDL loans of approximately

$62,500, through misrepresentations and false documentation.

m. StatutoryAllegations
   77. Between on or about June 18, 2020 and on or about January
L9, 2021., within the Eastern District of Pennsylvania and elsewhere,

the defendant,

                        JONATHAN OLIVETTI,

having devised and intended to devise a scheme and artifice to defraud

and to obtain money and property by means of materially false and

fraudulent pretenses, representations, and promises, and for the

purpose of executing the scheme and artifice to defraud, transmitted

and caused to be transmitted by means of wire communications in
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interstate commerce certain writings, signs, signals, pictures, and

soundsi namely, PPP Loan applications submitted by the internet and

interstate wires to Lender #1 and EIDL loan applications submitted by

the internet and interstate wires.

ry. Manner and Means of the Scheme
     It was part of the scheme and artifice to defraud that the
defendant employed the following manner and meansl

      18. On or about June 19,2020, the defendant used the internet
and interstate wires to submit and cause to be submitted to Lender #1,

a PPP loan application on behalf of Olivetti Law, LLC. The application

contained material misrepresentations, including that Olivetti Law,

LLC had a payroll of $8,333 per month, when in fact the payroll was

significantly less. The application certified that the information

provided was true, under penalty of law.

     19. In reliance on the fraudulent misrepresentations in the PPP
loan application, Lender #1 distributed approximately 920,800 in PPP

Ioan funds to OLIVETTI.

     20. On or about January 19, 2021, the defendant used the
internet and interstate wires to submit and cause to be submitted to

Lender #1, a PPP loan application on behalf of Olivetti Law, LLC. The
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application contained material misrepre sentations, including that

Olivetti Law, LLC had a payroll of $8,320 per month, when in fact the

payroll was significantly less. The application certified that the

information provided was true, under penalty of law

     21. In reliance on the fraudulent misrepresentations in the
second PPP loan application, Lender #1 distributed approximately

$20,800 in PPP loan funds to OLIVETTI.

     22. Between approximately June 2020 and February 2021, tlne
defendant used the internet and interstate wires to submit and cause to

be submitted to the SBA two EIDL loan applications each seeking

approximately $62,500 on behalf of Olivetti Law, LLC. The applications

contained material misrepresentations and ultimately were not

approved by the SBA.

     AII in violation of Title 18, United States Code, Section 1848.



                            JOHN C. GURGANUS
                            United States Attorney


                By:
                            JENI{Y         BERTS
                            Assistant   nited States Attorney

Date: \L        2oz
                                    8


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