Eden Prairie Man Sentenced to Over Seven Years in Prison for COVID Relief Fraud, Aggravated Identity Theft, and Money Laundering
Summary
U.S. Attorney Andrew M. Luger announced that Harold Bennie Kaeding, 75, of Eden Prairie was sentenced on November 15, 2024 by Judge Eric C. Tostrud to 87 months in federal prison and three years of supervised release, and was ordered to pay restitution. A federal jury convicted Kaeding after a ten-day trial in August 2024 on three counts of wire fraud, three counts of aggravated identity theft and one count of money laundering. Trial evidence showed that between March and May 2020 Kaeding applied for at least $2,182,625 in PPP and EIDL loans for six purported entities that were defunct or not in existence. Kaeding initially received approximately $1,642,670; after banks clawed some back, $658,490 remained, used in part to stop a home foreclosure, buy an SUV and stockpile more than $80,000 in cash. Kaeding fled to Colombia in early 2021 and was deported back to face prosecution.
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ST. PAUL, Minn. – An Eden Prairie man has been sentenced to 87 months in federal prison, three years of supervised release, and was ordered to pay restitution for fraudulently applying for more than $2.1 million in COVID-19 relief funds and then spending those proceeds on himself, announced U.S. Attorney Andrew M. Luger. As proven at trial, between March and May 2020, Harold Bennie Kaeding, 75, applied for at least $2,182,625 in loans through the Paycheck Protection Program (“PPP”) and the Economic Injury Disaster Loan (EIDL) Program. Kaeding used the name of his own close family members to submit the loan applications in the names of six different purported corporate entities. But these entities were either defunct or not even in existence when the pandemic began, trial evidence showed. None of the businesses had filed tax returns or reported the payment of wages to a single employee for calendar years 2019 and 2020. Kaeding instead fabricated tax documents, manufactured bank statements, and submitted other records to ensure the applications appeared legitimate. These false statements to lenders manufactured the number of employees a given entity employed, the amount of average monthly payroll expenses, and false statements about the intended use of the loan proceeds. As a result of his material falsehoods and omissions, Kaeding initially received approximately $1,642,670 in relief funds before some banks detected irregularities and clawed back some of the money. This left Kaeding with $658,490 in fraud proceeds, which he transferred to bank accounts—often opened in the names of close family members—that he controlled. Among other things, Kaeding used the money to get his personal residence out of impending foreclosure, purchase an SUV, and stockpile more than $80,000 in cash. In early 2021, Kaeding fled to Colombia after learning he was under investigation. Law enforcement eventually located Kaeding and successfully deported him back to the United States to face prosecution. Following a ten-day trial in August 2024, Kaeding was convicted by a federal jury on three counts of wire fraud, three counts of aggravated identity theft, and one count of money laundering. He was sentenced last Friday, November 15, 2024, by Judge Eric C. Tostrud in U.S. District Court. This case is the result of an investigation conducted by the FBI and IRS—Criminal Investigation. Assistant U.S. Attorneys Jordan L. Sing and Robert M. Lewis prosecuted the case.
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