Criminal Complaint — No. 23-13014 (D.N.J.)
Summary
A criminal complaint in United States v. Morton Chirnomas, Mag. No. 23-13014 (LDW) (D.N.J.), attested on the 7th day of February, 2023, charges wire fraud under Title 18, United States Code, Section 1343 for a scheme from May 2020 through September 2020. The affidavit alleges that an EIDL application in the name of Victim Company 1, received on or about July 28, 2020 and claiming $22,000,000 in gross revenues and $18,000,000 in costs of goods sold, was approved for approximately $149,900 and paid into an account in Chirnomas' name; the owner never applied. Massachusetts and Pennsylvania agencies also paid approximately $195,000.00 in unemployment benefits claimed in approximately 26 individuals' names into accounts in his name; 18 of them said they had not applied. Chirnomas, an attorney administratively ineligible to practice law in New Jersey, is charged, not convicted.
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UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
UNITED STATES OF AMERICA HON. LEDA DUNN WETTRE
V. Mag. No. 23-13014 (LDW)
MORTON CHIRNOMAS CRIMINAL COMPLAINT
I, David Arminio, being duly sworn, state the following is true and co1Tect
to the best of my knowledge and belief:
SEE A'ITACHMENT A
I further state that I am a Postal Inspector with the United States Postal
Inspection Service ("USPIS"), and that this complaint is based on the following
facts:
SEE ATTACHMENT B
continued on the attached page and mad~ ] er~
David Mminio
Postal Inspect.or, USPIS
Postal Inspector Arminio attested to this Complaint by telephone pursuant to
FRCP 4. l(b)(2)(A), on the 7th day of February, 2023.
HONORABLE LEDA DUNN WETTRE
UNITED STATES MAGISTRATE JUDGE Signature of Judicial Officer
ATTACHMENT A
From in or around May 2020 through in or around September 2020, in
Passaic County, in the District of New Jersey and elsewhere, defendant
MORTON CHIRNOMAS
did devise and intend 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 and attempting
to execute such scheme and artifice to defraud, did transmit and cause to be
transmitted by means of wire communications in interstate and foreign
commerce certain writings, signs, signals, pic tures, and sounds, including a
wire communication sent on or about June 23, 2020 , from a location outside of
New Jersey to a location inside of New J ersey.
In violation of Title 18, United States Code, Sec tion 1343.
ATTACHMENT B
I, David Arminio, am a Postal Inspector with the United States Postal
Inspection Service. I am familiar "vith the facts set forth herein based on my
own investigation, my conversations with other law enforcement officers, and
my review of reports, documents, and other evidence. Because this Complaint
is being submitted for a limited purpose, I have not set forth each and every
fact that I know concerning this investigation. Where statements of others are
related herein, they are related in substance and in part unless otherwise
indicated. Where I assert that an event took place on a particular date, I am
asserting that it took place on or about the date alleged.
I. Background Information During the Time of the Offense
A. The Economic Injury Disaster Loan Program
1. The Coronavirus Aid, Relief, and Economic Security ("CARES") Act
was a federal law enacted in or around March 2020 that was designed to
provide emergency financial assistance to Americans suffering the economic
effects of the COVID-19 pandemic. The CARES Act enabled the Small Business
Association ("SBA") to offer funding through the COVID-19 Economic Injury
Disaster Loans ("EIDL") program to business owners negatively affected by the
COVID-19 pandemic. The EIDL program provided low-interest financing and
grants to small businesses, renters, and homeowners in regions affected by
declared disasters, like the COVID-19 pandemic.
2. To obtain an EIDL, a qualifying business applied to the SBA and
provided certain information about its operations through an online portal. The
ElDL approval process required applicants to supply minimal eligibility
documentation and to affirm that the information in the application was true
and correct under the penalty of perjury and applicable criminal statutes. The
amount of an EIDL was based, in part, on the information provided by the
applicant-primarily, gross revenue minus cost of goods sold, divided by two.
The maximum loan amount was capped at $150,000 per entity. Qualifying
entities could use EIDL funds only on certain expenses, including fixed debts,
payroll, and accounts payable.
B. Unemployment Insurance Benefits
3. Unemployment Insurance ("UI") was a state-federal program that
provided unemployment insurance benefits ("UIBs") to eligible workers who
were unemployed through no fault of their own. Each state administered its
UIB program through a designated state workforce agency ("SWAs") subject to
federal laws and regulations and that typically set additional state-specific
requirements for eligibility, benefit amounts, and duration of payments.
Generally, UIB amounts were based on a percentage of earnings over a fixed
period.
C. Morton Chimomas
4. Morton Chirnomas ,,vas a resident of Clifton, New Jersey ("the
Clifton Address"). Chirnomas is an attorney but is currently administratively
ineligible to practice law in New Jersey.
II. The Investigation
A. The EIDL
5. On or about July 28, 2020, the SBA received an EIDL
application purporting to be from Victim Company 1. The application stated
that in 2019 Victim Company 1 had $22,000,000 in gross revenues and
$18,000,000 in costs of goods sold. The application further provided that the
SBA should send the EIDL, if approved, to a bank account ending in 3062 ("the
3062 Bank Account").
6. On or about August 3 , 2020, the SBA approved an approximately
$149,900 EIDL to Victim Company 1. Pursuant to the application, the loan
proceeds were transferred into the 3062 Bank Account.
7. The investigation has revealed that the 3062 Bank Account was
opened on or about July 16, 2020, in the name "Morton Chirnomas," using
Chirnomas' social security number and date of birth, and with the "Clifton
Address" . Chirnomas was the sole signatory on the 3062 Bank Account. The
debit card associated with the 3062 Bank Account was used to purchase
storage space from Google, LLC, for a specific Google account (the "Google
Account") . The name on the Google Account is "Mordi Chirnomas" and records
indicate that the Google Account was opened in or around 2007. When opening
the 3062 Bank Account, Chirnomas provided an email address (the "Email
Address"). The investigation has revealed that Chirnomas also used the Email
Address in connection with the Google Account and his PayPal account.
8. A review of the 3062 Bank Account revealed, among other things, a
$20,000 transfer to a bank account ending in 8396 (the "8396 Bank Account")
and a $10,000 wire transfer to a bank account ending in 4824 (the "4284 Bank
Account").
a. A review of the 8396 Bank Account revealed that the account
was opened on or about on or about July 21, 2020, in
Chirnomas' name and using his date of birth and social security
number. In addition, Chimomas provided an email address (the
"Second Email Address") associated with the Email Account
when opening the 8396 Bank Account.
b. A review of the 4824 Bank Account revealed that the account
was opened on or about ,July 22, 2020, with Chirnomas being
listed as the owner and the Clifton Address. When opening the
4824 Bank Account, Chirnomas provided a New Jersey Driver's
License. Law enforcement has confirmed that: (a ) the driver's
license is the driver's license on records with the New Jersey
Motor Vehicle Commission; and (b) the picture in the license is
a black and white match of Chirnomas' picture obtained from
the New Jersey Motor Vehicle Commission.
9. Law enforcement has spoken to the owner of Victim Company l.
The owner stated, in substance and in part, that the owner: (a) did not apply
for the EIDL described above; (b) did not authorize anyone else to apply for the
E[DL; and (c) does not know Chirnoma s.
10. The investigation has revealed that Chirnomas transferred money
from the 8396 Bank Account to an account at a cryptocurrency exchange
platform in his name. When opening the account at the cryptocurrency
exchange platform, Chirnomas provided both a picture of himself as well as his
driver's license. In addition, Chimomas linked the cryptocurrency exchange
account with the 3062 Bank Account, the 8396 Bank Account, and the 4824
Bank Account.
B. The UIBs
11. Between on or about May 19, 2020, and on or about September
18, 2020, the SWAs in Massachusetts and Pennsylvania sent approximately
$195,000.00 in UIBs into approximately five separate bank accounts, each in
Chimomas' name, in response to applications for UIBs in approximately 26
individuals' names.
12. The investigation has revealed that one of the bank accounts that
received the UIBs is a bank account ending in in 9307 (the "9307 Bank
Account"). The investigation further revealed that the 9307 Bank Account was
opened on May 7, 2020, in the name of "Morton Chirnomas". Records obtained
for the 9307 Bank Account revealed, among other things, a payment on or
about May 22, 2020, concerning a motor vehicle ticket for obstruction of
windshield for vision. On the ticket, the violator is listed as Chirnomas, with
his date of birth and the Clifton Address. The ticket also sets forth a license
plate that the investigation has revealed is associated with a car Chirnomas
owned at the time of the ticket. Further, the investigation has revealed a debit
card associated with the 9307 Bank Account was used to pay for auto
insurance for a policy in the name of "Morton Chirnomas" and which is
associated with at least one of Chirnomas' former residences.
13. The investigation has revealed that a second bank account that
received the UIBs is a bank account ending in in 2089 (the "2089 Bank
Account"). The wire transfers into this account included a wire transfer on or
about July 22, 2022, of UIBs from a location outside of New Jersey to a
location inside of New Jersey. The investigation further revealed that the 2089
Bank Account was opened on or about June 2, 2020, in Chirnomas' name
using the Clifton Address. Records obtained for the 2089 Bank Account
revealed, among other things, numerous wire transfers to the 9307 Bank
Account.
14. The investigation has revealed that the third bank account that
received the UIBs is a bank account ending in in 5032 (the "5032 Bank
Account"). The investigation further revealed that the 5032 Bank Account was
opened on or about May 23 , 2020, in Chirnomas' name using the Clifton
Address. Records obtained for the 5032 Ba nk Account included a picture of
Chirnomas making a withdrawal from 5032 Bank Account.
15. Law enforcement has spoken with approximately 18 of the
approximately 26 individuals whose names were used in submitting the UIB
applications discussed above. Each of these individuals stated, in substance
and in part, thats/he did not make the UlB application, authorize anyone to
make the UIB application, or kno"v Chirnomas.
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