Indictment — United States v. William Philip Werschler et al., Eastern District of Washington (ECF No. 1)

Summary

A grand jury indictment against William Philip Werschler, Spokane Dermatology Clinic, P.S., Premier Clinical Research, L.L.C. and 3rd & Sherman Plaza, L.L.C., Case No. 2:24-CR-141-TOR, in the U.S. District Court for the Eastern District of Washington, filed October 18, 2024 as ECF No. 1. It charges conspiracy under 18 U.S.C. § 1349 (Count 1), wire fraud under 18 U.S.C. § 1343 (Counts 2-18) and false claims (Counts 19-23). The indictment alleges that Werschler and others applied for at least three EIDL loans, later modified, for the companies and used proceeds for luxury vehicles, personal properties and real estate. It states that the SBA approved a $150,000 EIDL for Premier Clinical Research on or about November 27, 2020 and wired $149,900 on or about November 30, 2020. The 40-page indictment includes forfeiture allegations listing real property and vehicles.

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Case 2:24-cr-00141-TOR ECF No. 1

Vanessa R. Waldref

United States Attorney

Eastern District of Washington
Dan Fruchter

Jeremy J. Kelley
Assistant United States Attorneys
Post Office Box 1494

Spokane, WA 99210-1494
Telephone: (509) 353-2767

filed 10/18/24 PagelD.1 Page 1 of 40

FILED IN THE
U.S. DISTRICT COURT
EASTERN DISTRICT OF WASHINGTON

Oct 18, 2024

SEAN F. MCAVOY, CLERK

UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF WASHINGTON

UNITED STATES OF AMERICA,

Plaintiff,
Vv.

WILLIAM PHILIP WERSCHLER,
A/K/A WILLIAM PHILIP
WERSCHLER, JR..,

SPOKANE DERMATOLOGY CLINIC,
P.S.,

PREMIER CLINICAL RESEARCH,
L.L.C., and

Case No. 2:24-CR-141-TOR

INDICTMENT

Vio: 18 U.S.C. § 1349
Conspiracy
(Count 1)

18 U.S.C. § 1343
Wire Fraud
(Counts 2-18)

18 U.S.C. §§ 287, 2
False, Fictitious, or Fraudulent
Claims

(Counts 19-23)

3RD & SHERMAN PLAZA, L.L.C.,
Defendants. 18 U.S.C. § 981, 28 U.S.C.
§ 2461
Forfeiture Allegations
The Grand Jury charges:
GENERAL ALLEGATIONS

1. At all times relevant to this Indictment, Defendant WILLIAM PHILIP
WERSCHLER a/k/a William Philip Werschler, Jr., (hereinafter WILLIAM PHILIP
WERSCHLER) was a resident of Spokane, Washington, and an owner of

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Defendants SPOKANE DERMATOLOGY CLINIC, P.S., PREMIER CLINICAL
RESEARCH, L.L.C., and 3RD & SHERMAN PLAZA, L.L.C.

2. Defendant SPOKANE DERMATOLOGY CLINIC, P.S.,! was
incorporated in the State of Washington in 1996, listing Defendant WILLIAM
PHILIP WERSCHLER as the only member of the board of directors. According to
the annual report filed on or about September 9, 2024, with the Washington
Secretary of State, Defendant SPOKANE DERMATOLOGY CLINIC, P.S.’s
governors are Defendant WILLIAM PHILIP WERSCHLER and his wife, and its
principal office address is 324 S. Sherman St., Spokane, Washington.

3. Defendant PREMIER CLINICAL RESEARCH, L.L.C.,? is a limited
liability company organized in the State of Nevada, and which registered with the
Washington Secretary of State as a foreign company on or about April 5, 2006.
According to the annual report filed on or about March 12, 2024, with the
Washington Secretary of State, Defendant PREMIER CLINICAL RESEARCH,
L.L.C.’s governors are Defendant WILLIAM PHILIP WERSCHLER and his wife,
and its principal office address is 324 S. Sherman St., Spokane, Washington.

4. Defendant 3RD & SHERMAN PLAZA, L.L.C.,’ is a limited liability
company formed in the State of Washington on or about February 20, 2013, for the
stated purpose to “[o]wn, acquire, hold, pledge, transfer, dispose, sell, develop,
convey real estate” and “any lawful purpose.” The Certificate of Formation listed
Defendant WILLIAM PHILIP WERSCHLER and one other individual as executors
and listed the company’s physical address as 323 S. Grant Street, Spokane,
Washington. According to the annual report filed on January 16, 2024, with the
Washington Secretary of State, Defendant 3RD & SHERMAN PLAZA, L.L.C.’s

1 Sometimes referred to as “SDC.”
2 Sometimes referred to as “PCR.”

3 Sometimes referred to as “3ns.”

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governors are Defendant WILLIAM PHILIP WERSCHLER and his wife, and its
principal office address is 324 S. Sherman St., Spokane, Washington.

5. | C.C. was a resident of Spokane, Washington, and began working for
Defendant WILLIAM PHILIP WERSCHLER beginning in or around March 2020.
C.C.’s duties included performing bookkeeping and accounting work for Defendants
WILLIAM PHILIP WERSCHLER, SPOKANE DERMATOLOGY CLINIC, P.S.,
PREMIER CLINICAL RESEARCH, L.L.C., and 3RD & SHERMAN PLAZA,
L.L.C.

6. | The Coronavirus Aid, Relief, and Economic Security Act (CARES Act)
was a federal law enacted on March 27, 2020, designed to provide emergency
financial assistance to the millions of Americans who were suffering the economic
effects caused by the COVID-19 pandemic. One source of relief provided by the
CARES Act was the authorization of COVID-19 related funding for the Economic
Injury Disaster Loan (EIDL) program. EIDL is a Small Business Administration
(SBA) program that provides low-interest funding to small businesses, renters, and
homeowners affected by declared disasters.

7. Inorder to obtain an EIDL, a qualifying business was required to submit
an application to the SBA and provide information about its operations, such as the
number of employees, gross revenues for the 12-month period preceding the
disaster, and cost of goods sold in the 12-month period preceding the disaster. In
the case of EIDLs for COVID-19 relief, the 12-month period was the year preceding
January 31, 2020. The applicant was also required to certify that all the information
in the application was true and correct to the best of the applicant’s knowledge.

8. The amount of an EIDL, if the application was approved, was
determined based, in part, on the information provided in the application about
employment, revenue, and cost of goods, as set forth above. Any funds issued under
an EIDL or advance were issued directly by the SBA. EIDL funds could be used for

payroll expenses, employee sick leave, production costs, and business obligations

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and expenses, such as business debts, office rent, and office mortgage payments.
EIDL funds were not to be used for personal purposes or to obtain real property or
to pay off debts that were not yet due and owing, such as paying more than a required
monthly payment on a mortgage or other loan. EIDL funds were subject to a fixed
interest rate of 3.75% for businesses and a 30-year repayment term.

9. EIDL applications were received in cloud-based platforms. The
location of the server through which the EIDL application was submitted was based
on the date the application was processed by SBA and the application number. EIDL
disbursements were initiated by the SBA Denver Finance Center located in Denver,
Colorado, which transmitted the payment information through the SBA’s Financial
Management System (FMS) via interstate wires to the Department of Treasury for
final disbursement.

10. As initially funded, the SBA’s COVID-19 EIDL program had a
maximum loan cap of $150,000. On or about April 6, 2021, the maximum loan cap
was raised to $500,000. Borrowers were allowed to request additional funds at this
point in what was called a “modification” of the original EIDL application up to a
total loan amount of the $500,000 maximum. On or about September 8, 2021, the
maximum loan cap was raised to $2,000,000. Again, borrowers could request
additional funds as part of another modification of the original loan amount, up to
the $2,000,000 maximum.

11. To request a modification, borrowers were required to log into the
SBA’s Rapid Finance system servers located in Des Moines, Iowa. Through the
portal, borrowers would be able to request a modification up to the then-maximum
amount for which they were eligible. An Amended Loan Authorization and
Agreement and an Amended Security Agreement were required to be completed and
submitted to the SBA’s Rapid Finance system servers located in Des Moines, Iowa
by the borrower prior to SBA authorizing the disbursement of any increased EIDL

funds. EIDL modification disbursements were initiated by the SBA Denver Finance

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Center located in Denver, Colorado, which transmitted the payment information via
interstate wires through the SBA FMS to the Department of Treasury for final
disbursement.

The Scheme

12. The allegations in paragraphs 1 through 11 of this Indictment are
incorporated as though realleged herein.

13. Beginning no later than on or about April 2, 2020, and continuing
through at least August 2, 2022, in the Eastern District of Washington and elsewhere,
Defendant WILLIAM PHILIP WERSCHLER and others known and unknown to
the Grand Jury devised and intended to devise a scheme to defraud the SBA, and to
obtain money and property by means of materially false and fraudulent pretenses,
representations, and promises.

14. Specifically, Defendant WILLIAM PHILIP WERSCHLER and others
known and unknown to the Grand Jury applied for and received at least three EIDL
loans with later requests for modifications on behalf of Defendants SPOKANE
DERMATOLOGY CLINIC, P.S., PREMIER CLINICAL RESEARCH, L.L.C., and
3RD & SHERMAN PLAZA, L.L.C., with the intent to defraud, steal, and convert
proceeds of the EIDL loans for Defendant WILLIAM PHILIP WERSCHLER’s
personal use and for use by other companies, contrary to pretenses, representations,
and promises made and caused to be made by Defendant WILLIAM PHILIP
WERSCHLER when applying for and obtaining the EIDL funds. These
unauthorized and improper uses of EIDL funds included luxury vehicles, personal
properties, and real estate purchased by other companies than those that received the
EIDL funds.

Manner and Means
PREMIER CLINICAL RESEARCH, L.L.C.

15. On or about July 21, 2020, Defendant WILLIAM PHILIP
WERSCHLER, submitted and caused to be submitted EIDL Application No.
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3311496154 to the SBA under the name of Defendant PREMIER CLINICAL
RESEARCH, L.L.C. This application was submitted via interstate wires from IP
address 50.210.63.145 to the SBA’s Rapid Finance servers in Des Moines, Iowa.
Records from Comcast show that between March 26, 2020, and June 21, 2024, IP
address 50.210.63.145 was assigned to Defendant 3RD & SHERMAN PLAZA,
L.L.C. with a service address of 324 S. Sherman St., Bldg A, Spokane, Washington.
The application listed Defendant WILLIAM PHILIP WERSCHLER as the sole
owner of the business.

16. On or about November 25, 2020, Defendant WILLIAM PHILIP
WERSCHLER electronically signed and caused to be signed a Loan Authorization
and Agreement (LA&A) for Application No. 3311496154 and submitted it to the
SBA via interstate wires from IP address 50.210.63.145. In the LA&A, Defendant
WILLIAM PHILIP WERSCHLER agreed, promised, and represented that
Defendant PREMIER CLINICAL RESEARCH, L.L.C. would use the EIDL funds,
“solely as working capital to alleviate economic injury caused by disaster.”
Defendant WILLIAM PHILIP WERSCHLER also agreed, promised, and
represented that he would not, without prior written consent of the SBA, make any
distribution of Defendant PREMIER CLINICAL RESEARCH, L.L.C.’s assets by
way of loan, gift, bonus, or otherwise to any company owner, partner, or employee,
or to any company directly or indirectly controlling, affiliated with, or controlled by
Defendant PREMIER CLINICAL RESEARCH, L.L.C. In signing the LA&A,
Defendant WILLIAM PHILIP WERSCHLER agreed to be bound by its terms and
conditions.

17. On or about November 25, 2020, Defendant, WILLIAM PHILIP
WERSCHLER also electronically signed and caused to be signed a Security
Agreement for Application No. 3311496154 and submitted it to the SBA via
interstate wires from IP address 50.210.63.145. In the Security Agreement,
Defendant WILLIAM PHILIP WERSCHLER agreed, promised, and represented

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that none of the $150,000 in obligated EIDL funds “are or will be primarily for
personal, family, or household purposes.” Defendant WILLIAM PHILIP
WERSCHLER also represented in the Security Agreement that he had read and
understood the meaning and effect all its terms.

18. On or about November 27, 2020, as a result the representations and
promises made and caused to be made by Defendant WILLIAM PHILIP
WERSCHLER in the LA&A and Security Agreement relating to EIDL Loan
Application No. 3311496154, the SBA approved the requested EIDL in the amount
of $150,000. A third-party UCC handling charge of $100 was deducted from the
loan amount prior to disbursement. On or about November 30, 2020, the SBA,
through the use of interstate wires, made an Electronic Funds Transfer (“EFT”) from
the FMS servers in Sterling, Virginia, of $149,900 in EIDL funding to Defendant
PREMIER CLINICAL RESEARCH, L.L.C.’s bank account at Mountain West Bank
ending in -7658 located in Spokane, Washington. The approved loan was assigned
SBA Loan No. 9234608204.

19. OnFebruary 18, 2021, SBA received a request to reconsider the amount
of Defendant PREMIER CLINICAL RESEARCH, L.L.C.’s EIDL. This request
was denied as the EIDL of $150,000 was at the current program maximum and SBA
was unable to increase the amount.

20. Onor about April 6, 2021, the SBA raised the maximum amount of an
EIDL to $500,000. On or about April 21, 2021, C.C. texted Defendant WILLIAM
PHILIP WERSCHLER, “I’m working on increasing the EIDL loans. The max
amount is $500k, it used to be $150k. We need to call the SBA tomorrow, and let
them know it’s ok to talk to me about the loans otherwise they won’t.” Defendant
WILLIAM PHILIP WERSCHLER replied, “Ok, that’s great news.”

21. On or about April 26, 2021, Defendant WILLIAM PHILIP
WERSCHLER submitted and caused to be submitted, via interstate wires, a request
for a modification of EIDL application No. 3311496154-Mod-1 (SBA Loan No.

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9234608204) in the name of Defendant PREMIER CLINICAL RESEARCH, L.L.C.
and seeking additional EIDL funds.

22. As part of the modification process, on or about July 21, 2021,
Defendant WILLIAM PHILIP WERSCHLER electronically signed and caused to
be signed an Amended LA&A for the modification of EIDL Application No.
3311496154-Mod-1 (SBA Loan No. 9234608204) and submitted it to the SBA via
interstate wires from IP address 50.210.63.145. In the Amended LA&A, Defendant
WILLIAM PHILIP WERSCHLER agreed, promised, and represented that
Defendant PREMIER CLINICAL RESEARCH, L.L.C. would use the EIDL funds,
“solely as working capital to alleviate economic injury caused by disaster.”
Defendant WILLIAM PHILIP WERSCHLER also agreed, promised, and
represented that he would not, without prior written consent of the SBA, make any
distribution of Defendant PREMIER CLINICAL RESEARCH, L.L.C. assets by way
of loan, gift, bonus, or otherwise to any company owner, partner, or employee, or to
any company directly or indirectly controlling, affiliated with, or controlled by
Defendant PREMIER CLINICAL RESEARCH, L.L.C. In signing the Amended
LA&A, Defendant WILLIAM PHILIP WERSCHLER agreed to be bound by its
terms and conditions.

23. On or about July 21, 2021, Defendant, WILLIAM PHILIP
WERSCHLER also electronically signed and caused to be signed an Amended
Security Agreement for Application No. 3311496154 (SBA Loan No. 9234608204)
and submitted it to the SBA via interstate wires from IP address 50.210.63.145. In
the Amended Security Agreement, Defendant WILLIAM PHILIP WERSCHLER
agreed, promised, and represented that none of the $500,000 in obligated EIDL
funds “are or will be primarily for personal, family, or household purposes.”
Defendant WILLIAM PHILIP WERSCHLER also represented in the Amended
Security Agreement that he had read and understood the meaning and effect all its

terms.

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24. On or about July 24, 2021, as a result of the false representations,
pretenses, and promises made and caused to be made by Defendant WILLIAM
PHILIP WERSCHLER in the Amended LA&A and Amended Security Agreement
for EIDL Loan Application No. 3311496154-Mod-1 (SBA Loan No. 9234608204),
the SBA approved the requested EIDL modification, increasing the amount of the
EIDL to $500,000. As such, the SBA authorized the disbursement of an additional
$350,000 to Defendant PREMIER CLINICAL RESEARCH, L.L.C.

25. Onor about July 27, 2021, the SBA, through the use of interstate wires,
completed an EFT from the FMS servers in Sterling, Virginia, of $350,000 in EIDL
funding to Defendant PREMIER CLINICAL RESEARCH, L.L.C.’s account at
Mountain West Bank ending in -7658 located in Spokane, Washington. SBA
disbursed these EIDL funds to Defendant PREMIER CLINICAL RESERCH,
L.L.C., solely to provide working capital to that company to alleviate economic
injury caused by the COVID-19 disaster.

26. Onor about July 28, 2021, C.C. texted Defendant WILLIAM PHILIP
WERSCHLER and his wife, “We talked about paying down another riverbank loan
with the EIDL. The EIDL has a lower interest rate at 3.75% and the river bank loans
are at 4.28% and 4.48%.” Defendant WILLIAM PHILIP WERSCHLER later
replied, “Great. Pay off highest interest of course.” He continued, “Saving 77 basis
points.” Defendant WILLIAM PHILIP WERSCHLER then directed, “Ok. Let’s
pay off the $287 And wait until we hear on the 2nd EIDL increase.”

27. Onor about July 28, 2021, C.C. texted Defendant WILLIAM PHILIP
WERSCHLER that she had the loan pay off amount for 334 Grant St., which was
$286,792.42, and asked if she could have his wife sign a check to pay it off.
Defendant WILLIAM PHILIP WERSCHLER replied, “Yes please.” On or about
July 28, 2021, C.C. texted Defendant WILLIAM PHILIP WERSCHLER and his
wife, “Check from PCR is signed! I’m bringing it to Riverbank today.” Defendant
WILLIAM PHILIP WERSCHLER electronically “liked” the message.

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28. On or about July 30, 2021, Defendant WILLIAM PHILIP
WERSCHLER caused check #5303 to be issued from the account to the order of
“Riverbank” in the amount of $286,792.42 with the memo of “Loan Pay off for 334
S. Grant — Loan #1730.”

29. On or about July 28, 2021, $286,792.42 was credited to pay off the
entire remaining balance of Riverbank Loan No. 1730. Riverbank records show that
Loan No. 1730 was a business line of credit applied for in the name of Defendant
WILLIAM PHILIP WERSCHLER and his wife in October 2019. Defendant
SPOKANE DERMATOLOGY CLINIC, P.S., was the guarantor of the loan. On or
about December 5, 2019, Defendant WILLIAM PHILIP WERSCHLER drew
$328,000 from the line of credit with $323,512.61 to be a payment on Loan No. 1555
and $4,487.39 to be paid for various charges related to a real estate transaction. The
specific purpose for the draw was listed as “TERM OUT EXISTING
COMMERCIAL REAL ESTATE NOTE.”

30. On or about August 8, 2021, Defendant WILLIAM PHILIP
WERSCHLER entered into a residential real estate purchase contract for 7611 E.
Medlock Dr., Scottsdale, Arizona, for a total purchase price of $575,000.00. On or
about August 10, 2021, Defendant WILLIAM PHILIP WERSCHLER wired
$10,000 from his personal checking account at Riverbank ending in -3522 as earnest
money for the purchase.

31. On or about August 18, 2021, Defendant WILLIAM PHILIP
WERSCHLER texted C.C. that the realtor wanted to know if his wife “was on the
deed for house in AZ or would it be quit claim.” He then wrote, “Going to have to
get her liquored up and tell her.”

32. On or about August 20, 2021, Defendant WILLIAM PHILIP
WERSCHLER texted C.C. that the closing should be on August 25th. He then
wrote, “I might need your help moving funds around the 23rd. Will put [sic] be
available?” C.C. replied, “I think we will need to do a cashiers check. I'll double

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check, but let’s get started on Monday. Riverbank is so relax, idk if mt west will
have the same policy.” Defendant WILLIAM PHILIP WERSCHLER later texted

C.C.:

C.C. replied, “Perfect. Nailed it.” Defendant WILLIAM PHILIP WERSCHLER
later texted that his wife “doesn’t need to sign, it’s the 3 & Sherman LLC that is

This is what I sent to Jim at RB today:

Hi Jim, happy Friday. I hope you’re golfing, beautiful day.
Update on the Scottsdale townhouse.

Looking at closing on the 25th of this month.

I will need to move some funds around. Looking at advancing 400k
from personal loc into SDC.

SDC will be paying an internal loan to 3rd & Sherman is why. 3rd &
Sherman will be the buyer of the house. To recall, 3rd & Sherman is all
property LLC.

Then we will use ~ 160-170k in 3rd & Sherman money for the balance.
The total is ~ 575k + my share of closing costs, taxes, HOA, etc. figure
585 or so. Still waiting on the final number.

I put 10k down for earnest $.

Anything beyond the 400k + what 3rd & Sherman has available I will
use personal funds in our RB acct.

Once we get everything figured out, I’ll have RB do a wire as we’re
doing a remote signing.

I will have ICC] our finance person coordinate all the
transfers/advances with RB.

Hope that makes sense. Text or call if you have any questions. I’m
around this weekend.

the buyer.”

33. On or about August 23, 2021, Defendant WILLIAM PHILIP

WERSCHLER texted C.C., “What’s the game plan for moving funds?”

replied, “Ok J think we can do a wire from Riverbank to Mt West.” C.C. then later
texted Defendant WILLIAM PHILIP WERSCHLER, “Have riverbank move $400k
from your personal LOC to SDC.

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I can work on everything else after that!”
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Defendant WILLIAM PHILIP WERSCHLER electronically “liked” this text
message.

34. On or about August 23, 2021, $100,969.79 was transferred from
Defendant PREMIER CLINICAL RESEARCH, L.L.C.’s Mountain West Bank
account ending in -7658, to Defendant 3RD & SHERMAN PLAZA, L.L.C.’s
Mountain West Bank account ending in -9367. Mountain West Bank account ending
in -7658 was the account into which the SBA had disbursed $350,000 in EIDL funds
on July 27, 2021, for use solely as working capital for Defendant PREMIER
CLINICAL RESEARCH, L.L.C., and of which $286,792.42 had previously been
used to pay off Loan No. 1730 on or about July 30, 2021, at the direction of
Defendant WILLIAM PHILIP WERSCHLER.

35. On or about August 24, 2021, C.C. texted Defendant WILLIAM
PHILIP WERSCHLER, “You only have $200k in your personal line of credit.” He
replied, “It’s supposed to be $500k.” C.C. replied, “We can take the other $200k
from the business LOC for now.” Defendant WILLIAM PHILIP WERSCHLER
later texted C.C., “If we need to just use the SDC loc but I want to get the wire done
today.”

36. On or about August 24, 2021, an additional $400,000 was wired to
Defendant 3RD & SHERMAN PLAZA, L.L.C.’s Mountain West Bank account
ending in -9367 from the Defendant SPOKANE DERMATOLOGY CLINIC, P.S.’s
Riverbank account ending in -4229. Information provided with the wire indicated,
“Memo: Pay down intercompany *loan*.” These funds had been deposited into the
Riverbank account on August 23, 2021, from Riverbank business Loan No. 729 in
the name of Defendant SPOKANE DERMATOLOGY CLINIC, P.S. with the note,
“Personal. Will reimburse with personal L.” As detailed below, Defendant
WILLIAM PHILIP WERSCHLER would subsequently, on or about October 5,
2021, use $200,000 in EIDL funds disbursed to Defendant SPOKANE
DERMATOLOGY CLINIC, P.S., to repay a portion of the $400,000 from

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Riverbank Loan No. 729 that was used to fund the purchase of 7611 E. Medlock Dr.,
Scottsdale, Arizona.

37. On or about August 25, 2021, a wire transfer was completed from
Defendant 3RD & SHERMAN PLAZA, L.L.C.’s account ending in -9367 to First
American Title Insurance in the amount of $566,720.87. Records from First
American Title Insurance indicate that the wire of $566,720.87 from Defendant 3RD
& SHERMAN PLAZA, L.L.C.’s account ending in -9367 completed the purchase
of 7611 E. Medlock Dr., Scottsdale, Arizona. On or about August 24, 2021, a
Warranty Deed was executed conveying 7611 E. Medlock Dr., Scottsdale, Arizona,
to Defendant 3RD & SHERMAN PLAZA, L.L.C.

38. On or about December 16, 2021, Defendant WILLIAM PHILIP
WERSCHLER signed and executed a Warranty Deed on behalf of Defendant 3RD
& SHERMAN PLAZA, L.L.C., conveying 7611 E. Medlock Dr., Scottsdale,
Arizona, from the company to Defendant WILLIAM PHILIP WERSCHLER and
his wife in consideration of $10.00. 7611 E. Medlock Dr. is a residential property
that was used for personal use.

39. On or about September 8, 2021, the SBA raised the maximum EIDL
amount to $2,000,000. On or about September 10, 2021, C.C. texted Defendant
WILLIAM PHILIP WERSCHLER and his wife the following SBA website
screenshot that discussed increasing the EIDL cap to $2,000,000:

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4:10 aot
@ sba.gov
US Small Busines —
SBA iinene. MENU =

“The SBA’s COVID Economic Injury Disaster Loan
program offers a lifeline to millions of small

businesses who are still being impacted by the
pandemic, SBA Administrator Isabella Casillas
Guzman said. “We've retooled this critical program -

increasing the borrowing limit to $2 million, offering
24 months of deferment, and expanding flexibility to
allow borrowers to pay down higher-interest |
business debt. We have also ramped up our
outreach efforts to ensure we’re connecting with
smallest businesses as well as those from low-
income communities who may also be eligible for
the companion COVID EIDL Targeted Advance and
Supplemental Advance grants totaling up to $15,000.
Our mission-driven SBA team has been working
around the clock to make the loan review process as
user-friendly as possible to ensure every
entrepreneur who needs help can get the capital
they need to reopen, recover and rebuild.”

Key changes being announced by the SBA include:

© Increasing the COVID EIDL Cap. The SBA will lift
the COVID EIDL cap from $500,000 to $2 million.
Loan funds can be used for any normal
operating expenses and working capital,
including payroll, purchasing equipment, .

paying debt. to Top

C.C. then wrote “Increase from 500k to $2 million” and “Maybe round 3 PPP.”
Defendant WILLIAM PHILIP WERSCHLER replied, “Yes!!!!”

40. On or about September 12, 2021, C.C. texted Defendant WILLIAM
PHILIP WERSCHLER, “I applied to increase PCR’s SBA loan last night lol. No
update on SDC yet and 3rd and Sherman... most likely not.” Later, C.C. texted the
following image of EIDL rules regarding the use of EIDL funds to Defendant
WILLIAM PHILIP WERSCHLER:

INDICTMENT - 14
Case 2:24-cr-00141-TOR ECFNo.1_ filed 10/18/24 PagelD.15 Page 15 of 40

Uses of Proceeds

Working capital to make regular payments
for operating expenses, including payroll,
rent/mortgage, utilities, and other ordinary
business expenses, and to pay business debt
incurred at any time (past present or future)

C.C. then wrote, “Changes to use of proceeds,” “And deferred payments for 2 years.”
Defendant WILLIAM PHILIP WERSCHLER replied, “Free $!”

41. On or about September 12, 2021, Defendant WILLIAM PHILIP
WERSCHLER submitted and caused to be submitted, via interstate wires, a request
for a modification of EIDL Application No. 3311496154-Mod-2 (SBA Loan No.
9234608204), in the name of Defendant PREMIER CLINICAL RESEARCH,
L.L.C. and seeking additional EIDL funds.

42. On or about September 30, 2021, Defendant WILLIAM PHILIP
WERSCHLER texted to C.C. that his wife “is telling me we are broke. I want a
GT3. Men are from Mars, women from Venus. Alas....” On or about December
16, 2021, Defendant WILLIAM PHILIP WERSCHLER texted C.C., “I found a
GT3....” C.C. inquired, “How much,” and he responded, “Not sure. I’m getting a
PPI then negotiate.”

43. Onor about January 6, 2022, C.C. texted Defendant WILLIAM PHILIP
WERSCHLER, “Guess what? PCR got the $2 mil increase.” Defendant WILLIAM
PHILIP WERSCHLER replied, “Lol.”

44. Aspart of the second modification process, on or about January 6, 2022,
Defendant WILLIAM PHILIP WERSCHLER electronically signed and caused to
be signed another Amended LA&A for the second modification of EIDL
Application No. 3311496154-Mod-2 (SBA Loan No. 9234608204) and submitted it

INDICTMENT - 15
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to the SBA via interstate wires from IP address 50.210.63.145. In the second
Amended LA&A, Defendant WILLIAM PHILIP WERSCHLER agreed, promised,
and represented that Defendant PREMIER CLINICAL RESEARCH, L.L.C. would
use the EIDL funds, “solely as working capital to alleviate economic injury caused
by disaster.” Defendant WILLIAM PHILIP WERSCHLER also agreed, promised,
and represented that he would not, without prior written consent of the SBA, make
any distribution of Defendant PREMIER CLINICAL RESEARCH, L.L.C.’s assets
by way of loan, gift, bonus, or otherwise to any company owner, partner, or
employee, or to any company directly or indirectly controlling, affiliated with, or
controlled by Defendant PREMIER CLINICAL RESEARCH, L.L.C. In signing the
second Amended LA&A, Defendant WILLIAM PHILIP WERSCHLER agreed to
be bound by its terms and conditions.

45. On or about January 6, 2022, Defendant, WILLIAM PHILIP
WERSCHLER also electronically signed and caused to be signed a second Amended
Security Agreement for Application No. 3311496154 (SBA Loan No. 9234608204)
and submitted it to the SBA via interstate wires from IP address 50.210.63.145. In
the Security Agreement, Defendant WILLIAM PHILIP WERSCHLER agreed,
promised, and represented that none of the $2,000,000 in obligated EIDL funds “are
or will be primarily for personal, family, or household purposes.” Defendant
WILLIAM PHILIP WERSCHLER also represented in the second Amended
Security Agreement that he had read and understood the meaning and effect all its
terms.

46. On or about January 9, 2022, as a result of the false representations,
pretenses, and promises made and caused to be made by Defendant WILLIAM
PHILIP WERSCHLER in the second Amended LA&A and second Amended
Security Agreement for EJDL Loan Application No. 3311496154-Mod-2 (SBA
Loan No. 9234608204), the SBA approved the requested EIDL modification,
increasing the amount of the EIDL to $2,000,000. As such, the SBA authorized the

INDICTMENT - 16
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disbursement of an additional $1,500,000 to Defendant PREMIER CLINICAL
RESEARCH, L.L.C.

47. On or about January 11, 2022, the SBA, through the use of interstate
wires, completed an EFT from the FMS servers in Sterling, Virginia, of $1,500,000
in EIDL funding to Defendant PREMIER CLINICAL RESEARCH, L.L.C.’s
account at Mountain West Bank ending in -7658 located in Spokane, Washington.
These funds were disbursed solely to provide working capital to Defendant
PREMIER CLINICAL RESEARCH, L.L.C., to alleviate economic injury caused by
the COVID-19 disaster. Prior to the deposit of EIDL funds, the account had a
balance of approximately $75,531.01.

48. On or about January 11, 2022, C.C. texted Defendant WILLIAM
PHILIP WERSCHLER and his wife, “The SBA proceeds came in this morning for
PCR. $1.5 million.” Defendant WILLIAM PHILIP WERSCHLER replied, “Lol.
Thanks.”

49. On or about January 25, 2022, Defendant WILLIAM PHILIP
WERSCHLER texted C.C., “Hi of the 1.4m left on the EIDL funds, where is it
parked? Mtn. West, RB, Schwab?” C.C. replied, “Mt West. 1.29M - $99k to 3ns,
$115 to sdc.” Defendant WILLIAM PHILIP WERSCHLER replied, “K. Want to
move to RB?” C.C. asked, “For what?” Defendant WILLIAM PHILIP
WERSCHLER replied, “Was that internal loan po for SDC?” C.C. replied, “Yes.”

50. On or about January 27, 2022, Defendant WILLIAM PHILIP
WERSCHLER, under the name of Pure Performance Motorsports L.L.C., signed a
buyer’s order to purchase a 2011 Porsche 911 GT3 with VIN
WP0AC2A97BS783331 from Ryan Friedman Motor Cars L.L.C., in Glen Cove,
New York, in the total amount of $163,687.50. On or about January 27, 2022,
Defendant WILLIAM PHILIP WERSCHLER, under the name of Pure Performance
Motorsports L.L.C., also signed a buyer’s order to purchase a 1997 Porsche Carrera
with VIN WP0CA2996VS342006 from Ryan Friedman Motor Cars L.L.C., in the

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total amount of $88,687.50. The total purchase price for both vehicles was
$252,375.00.

51. On or about January 28, 2022, C.C. wrote to Defendant WILLIAM
PHILIP WERSCHLER, “Did you get a new car?!” C.C. texted Defendant
WILLIAM PHILIP WERSCHLER on or about January 31, 2022, “Mt. West just
reached out. Can we wire the $ from riverbank. We can use the business LOC and
I’ll pay it back tomorrow. It’s easier to get the wire out from RB today. If we do it
from Mt West, i will need to come down and have you sign a form and then drop it
off at the branch.” Defendant WILLIAM PHILIP WERSCHLER replied, “ok.”

52. On or about January 31, 2022, $252,375.00 was disbursed from
Riverbank Loan No. 729 in the name of Defendant WILLIAM PHILIP
WERSCHLER to Defendant Riverbank SPOKANE DERMATOLOGY CLINIC
P.S.’ Riverbank account ending in -4229. The note on the transfer is, “Werschler
Personal.” On or about January 31, 2022, Defendant WILLIAM PHILIP
WERSCHLER caused a wire transfer of $252,375.00 from Defendant SPOKANE
DERMATOLOGY CLINIC, P.S.’s Riverbank account ending in -4229 to Ryan
Friedman Motor Cars L.L.C. The listed purpose of the wire transfer was a vehicle
purchase. In communications with Riverbank, C.C. indicated that Defendant
WILLIAM PHILIP WERSCHLER requested the wire and stated, “We were going
to initially wire from Mt. West but decided not to.” C.C. noted that Defendant
WILLIAM PHILIP WERSCHLER was cc’ed on the email “for approval.”

53. On or about January 31, 2022, Defendant WILLIAM PHILIP
WERSCHLER caused check number 5402 to be drawn from Defendant PREMIER
CLINICAL RESEARCH, L.L.C.’s Mountain West Bank account ending in -7658 in
the amount of $252,375.00 to the order of Defendant SPOKANE DERMATOLOGY
CLINIC, P.S. This check was deposited into the Riverbank account for Defendant
SPOKANE DERMATOLOGY CLINIC, P.S. ending in -4229 on or about February
2, 2022.

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54. Prior to the deposit of check number 5402 on February 2, 2022,
Defendant SPOKANE DERMATOLOGY CLINIC, P.S.’s Riverbank account
ending in -4229 had a balance of approximately $22,521.47. On or about February
2, 2022, $200,000.00 was paid from account ending in -4229 to Riverbank Loan No.
729, with the note “payment for dr w personal draw.” Loan No. 729 had been used
to fund the purchase of the two Porsches from Ryan Friedman Motor Cars L.L.C.

55. On or about February 1, 2022, Defendant WILLIAM PHILIP
WERSCHLER sent six images to C.C. via text message of two different
automobiles, which were consistent with the automobiles in the purchase orders
from Ryan Friedman Motor Cars L.L.C. and which appear to be screenshots from
the Ryan Friedman Motor Cars L.L.C. website. Two of images sent by Defendant
WILLIAM PHILIP WERSCHLER are set forth below:

17:37

56. On or about May 3, 2022, C.C. texted Defendant WILLIAM PHILIP
WERSCHLER, “What is our reason for an increase” “For the sba loan.” Defendant
WILLIAM PHILIP WERSCHLER replied, “Buy more cars?” C.C. replied, “I said
for payroll, rent and business expenses.” Defendant WILLIAM PHILIP
WERSCHLER texted, “Perfect.”

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57. On June 30, 2022, C.C. emailed an attorney at Stamper Rubens, P.S.,
stating two individuals “are selling their house across the clinic” and that “[w]Je are
both in agreement of the sale price for both homes at $550k.” C.C. further stated,
“We are paying cash and the transaction will be under 3rd and Sherman LLC.”
Defendant WILLIAM PHILIP WERSCHLER was cc’ed on the email. On or about
June 30, 2022, C.C. texted Defendant WILLIAM PHILIP WERSCHLER, “Still
can’t believe we are getting those two houses for $550k lol.” Defendant WILLIAM
PHILIP WERSCHLER electronically “liked” the text.

58. On or about July 11, 2022, Defendant WILLIAM PHILIP
WERSCHLER signed a real estate purchase and sale agreement for 324 and 328 S.
Grant Street, Spokane, Washington, listing the buyer as Defendant 3RD &
SHERMAN PLAZA, L.L.C. On or about July 29, 2022, C.C. texted Defendant
WILLIAM PHILIP WERSCHLER and his wife that she had “sent out an email to
mt west for the wire. Approval is needed.” Defendant WILLIAM PHILIP
WERSCHLER replied, “Ok.”

59. On or about July 29, 2022, Defendant WILLIAM PHILIP
WERSCHLER caused a wire transfer from Defendant PREMIER CLINICAL
RESEARCH, L.L.C.’s Mountain West Bank account ending in -7658 to Stamper
Rubens, P.S. in the amount of $533,143.13. On August 2, 2022, a second wire
transfer was completed to Stamper Rubens, P.S. in the amount of $20,000. On July
29, 2022, a statutory warranty deed was executed granting 324 and 328 S. Grant
Street, Spokane, to Defendant 3RD & SHERMAN PLAZA, L.L.C.

SPOKANE DERMATOLOGY CLINIC, P.S.

60. On or about July 14, 2020, Defendant WILLIAM PHILIP
WERSCHLER, submitted and caused to be submitted EIDL Application No.
3310708609 to the SBA under the name Defendant SPOKANE DERMATOLOGY
CLINIC, P.S. This application was submitted via interstate wires from IP address
50.210.63.145 to the SBA’s Rapid Finance servers in Des Moines, Iowa. The

INDICTMENT - 20
Case 2:24-cr-00141-TOR ECFNo.1 filed 10/18/24 PagelD.21 Page 21 of 40

application listed Defendant WILLIAM PHILIP WERSCHLER as the sole owner
of Defendant SPOKANE DERMATOLOGY CLINIC, P.S.

61. On or about August 4, 2020, Defendant WILLIAM PHILIP
WERSCHLER electronically signed and caused to be signed a Loan Authorization
and Agreement (LA&A) for Application No. 3310708609 and submitted it to the
SBA via interstate wires from IP address 50.210.63.145. In the LA&A, Defendant
WILLIAM PHILIP WERSCHLER agreed, promised, and represented that
Defendant SPOKANE DERMATOLOGY CLINIC, P.S. would use the EIDL funds,
“solely as working capital to alleviate economic injury caused by disaster.”
Defendant WILLIAM PHILIP WERSCHLER also agreed, promised, and
represented that he would not, without prior written consent of the SBA, make any
distribution of Defendant SPOKANE DERMATOLOGY CLINIC, P.S.’s assets by
way of loan, gift, bonus, or otherwise to any company owner, partner, or employee,
or to any company directly or indirectly controlling, affiliated with, or controlled by
Defendant SPOKANE DERMATOLOGY CLINIC, P.S. In signing the LA&A,
Defendant WILLIAM PHILIP WERSCHLER agreed to be bound by its terms and
conditions.

62. On or about August 4, 2020, Defendant, WILLIAM PHILIP
WERSCHLER also electronically signed and caused to be signed a Security
Agreement for Application No. 3310708609 and submitted it to the SBA via
interstate wires from IP address 50.210.63.145. In the Security Agreement,
Defendant WILLIAM PHILIP WERSCHLER agreed, promised, and represented
that none of the $150,000 in obligated EIDL funds “are or will be primarily for
personal, family, or household purposes.” Defendant WILLIAM PHILIP
WERSCHLER also represented in the Security Agreement that he had read and
understood the meaning and effect all its terms.

63. Onor about August 4, 2020, as a result of the representations, pretenses,
and promises made and caused to be made by Defendant WILLIAM PHILIP

INDICTMENT - 21
Case 2:24-cr-00141-TOR ECFNo.1 filed 10/18/24 PagelD.22 Page 22 of 40

WERSCHLER the SBA approved EIDL Application No. 3310708609 in the amount
of $150,000. This loan was assigned SBA loan No. 2196978206. A third-party
UCC handling charge of $100 was deducted from the loan amount prior to
disbursement. On or about August 6, 2020, an ACH transaction was completed via
interstate wires transferring $149,900 into Defendant SPOKANE
DERMATOLOGY CLINIC, P.S.’s Riverbank account ending in -4229.

64. OnFebruary 18, 2021, SBA received a request to reconsider the amount
of Defendant SPOKANE DERMATOLOGY CLINIC, P.S.’s EIDL. This request
was denied as the EIDL of $150,000 was at the current program maximum and SBA
was unable to increase the amount.

65. Onor about April 6, 2021, the SBA raised the maximum amount of an
EIDL to $500,000. On or about June 15, 2021, Defendant WILLIAM PHILIP
WERSCHLER submitted and caused to be submitted, via interstate wires, a request
for a modification of EIDL Application No. 3310708609-Mod-1 (Loan No.
2196978206) in the name Defendant SPOKANE DERMATOLOGY CLINIC, P.S.,
and seeking additional EIDL funds.

66. As part of the modification process, on or about September 28, 2021,
Defendant WILLIAM PHILIP WERSCHLER electronically signed and caused to
be signed an Amended LA&A for the modification of EIDL Application No.
3310708609-Mod-1 (Loan No. 2196978206) and submitted it to the SBA via
interstate wires from IP address 50.210.63.145. In the Amended LA&A, Defendant
WILLIAM PHILIP WERSCHLER agreed, promised, and represented that
Defendant SPOKANE DERMATOLOGY CLINIC, P.S. would use the EIDL funds,
“solely as working capital to alleviate economic injury caused by disaster.”
Defendant WILLIAM PHILIP WERSCHLER also agreed, promised, and
represented that he would not, without prior written consent of the SBA, make any
distribution of Defendant SPOKANE DERMATOLOGY CLINIC, P.S.’s assets by

way of loan, gift, bonus, or otherwise to any company owner, partner, or employee,

INDICTMENT - 22
Case 2:24-cr-00141-TOR ECFNo.1 filed 10/18/24 PagelD.23 Page 23 of 40

or to any company directly or indirectly controlling, affiliated with, or controlled by
Defendant SPOKANE DERMATOLOGY CLINIC, P.S. In signing the Amended
LA&A, Defendant WILLIAM PHILIP WERSCHLER agreed to be bound by its
terms and conditions.

67. On or about September 28, 2021, Defendant, WILLIAM PHILIP
WERSCHLER also electronically signed and caused to be signed an Amended
Security Agreement for Application No. 3310708609-Mod-1 (Loan No.
2196978206) and submitted it to the SBA via interstate wires from IP address
50.210.63.145. In the Amended Security Agreement, Defendant WILLIAM PHILIP
WERSCHLER agreed, promised, and represented that none of the $500,000 in
obligated EIDL funds “are or will be primarily for personal, family, or household
purposes.” Defendant WILLIAM PHILIP WERSCHLER also represented in the
Amended Security Agreement that he had read and understood the meaning and
effect all its terms.

68. On or about October 1, 2021, as a result of the false representations,
pretenses, and promises made and caused to be made by Defendant WILLIAM
PHILIP WERSCHLER in the Amended LA&A and Amended Security Agreement
for EIDL Loan Application No. 3310708609-Mod-1 (Loan No. 2196978206), the
SBA approved the requested EIDL modification, increasing the amount of the EIDL
to $500,000. As such, the SBA authorized the disbursement of an additional
$350,000 to Spokane Dermatology Clinic.

69. On or about October 5, 2021, the SBA, through the use of interstate
wires, completed an EFT from the FMS servers in Sterling, Virginia, of $350,000 in
EIDL funding to Defendant SPOKANE DERMATOLOGY CLINIC, P.S.’s account
at Riverbank ending in -4229, located in Spokane, Washington. Prior to the transfer,
the account contained $4,514.15. The EIDL funds were disbursed solely to provide
working capital to Defendant SPOKANE DERMATOLOGY CLINIC, P.S. to

alleviate economic injury cause by the COVID-19 disaster.

INDICTMENT - 23
Case 2:24-cr-00141-TOR ECF No.1 _ filed 10/18/24 PagelD.24 Page 24 of 40

70. Onor about October 5, 2021, $200,000 was transferred from Riverbank
ending in -4229 to make a payment on Riverbank business line of credit Loan No.
729, which on or about August 25, 2021, had funded the purchase of personal real
property at 7611 E. Medlock Dr., Scottsdale, Arizona, as discussed herein. The
transfer served to pay off half of the $400,000 debt owed on Loan 729 related to that
purchase.

71. On or about October 11, 2021, WILLIAM PHILIP WERSCHLER
texted C.C., “Any loan updates?” On or about October 12, 2021, C.C. texted
Defendant WILLIAM PHILIP WERSCHLER the following image of the SBA

online portal used to request EIDL loan modifications:

C.C. wrote that she was “Requesting 1.5 million for the clinic.” Defendant
WILLIAM PHILIP WERSCHLER liked the image.
72. On or about October 12, 2021, Defendant WILLIAM PHILIP

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WERSCHLER submitted and caused to be submitted, via interstate wires, a second
request for a modification of EIDL Application No. 3310708609-Mod-2 (Loan No.
2196978206) in the name Defendant SPOKANE DERMATOLOGY CLINIC, P.S.,
and seeking additional EIDL funds. The SBA denied a second modification to the
loan, noting its analysis showed Defendant SPOKANE DERMATOLOGY CLINIC,
P.S. lacked an ability to repay the loan.
3RD & SHERMAN PLAZA, L.L.C.

73. On or about April 2, 2020, Defendant WILLIAM PHILIP
WERSCHLER submitted and caused to be submitted EIDL Application No.
3600539172 to the SBA under the name of Defendant 3RD & SHERMAN PLAZA,

L.L.C., doing business as 3 and Sherman Medical Plaza. The application was
submitted via interstate wires to SBA servers in Des Moines, Iowa, from IP address
50.210.63.145. The application listed Defendant WILLIAM PHILIP
WERSCHLER as the sole owner of the business. The application stated the
company was a medical services business with monthly revenue of $47,552.24, 2019
gross revenue of $546,626, and 2019 rental properties of $522,312.

74. On or about June 10, 2020, Defendant WILLIAM PHILIP
WERSCHLER electronically signed and caused to be signed a Loan Authorization
and Agreement (LA&A) for Application No. 3600539172 and submitted it to the
SBA via interstate wires. In the LA&A, Defendant WILLIAM PHILIP
WERSCHLER agreed, promised, and represented that Defendant 3RD &
SHERMAN PLAZA, L.L.C. would use the EIDL funds, “solely as working capital
to alleviate economic injury caused by disaster.” Defendant WILLIAM PHILIP
WERSCHLER also agreed, promised, and represented that he would not, without
prior written consent of the SBA, make any distribution of Defendant 3RD &
SHERMAN PLAZA, L.L.C.’s assets by way of loan, gift, bonus, or otherwise to any
company owner, partner, or employee, or to any company directly or indirectly

controlling, affiliated with, or controlled by Defendant 3RD & SHERMAN PLAZA,

INDICTMENT - 25
Oo ON AHA A HR WO PO —

Case 2:24-cr-00141-TOR ECFNo.1 filed 10/18/24 PagelD.26 Page 26 of 40

L.L.C. In signing the LA&A, Defendant WILLIAM PHILIP WERSCHLER agreed
to be bound by its terms and conditions.

75. On or about June 10, 2020, Defendant, WILLIAM PHILIP
WERSCHLER also electronically signed and caused to be signed a Security
Agreement Application No. 3600539172 and submitted it to the SBA via interstate
wires. In the Security Agreement, Defendant WILLIAM PHILIP WERSCHLER
agreed, promised, and represented that none of the $150,000 in obligated EIDL
funds “are or will be primarily for personal, family, or household purposes.”
Defendant WILLIAM PHILIP WERSCHLER also represented in the Security
Agreement that he had read and understood the meaning and effect of all its terms.

76. On or about June 11, 2020, as a result of the false representations,
pretenses, and promises made and caused to be made by Defendant WILLIAM
PHILIP WERSCHLER the SBA approved EIDL Application No. 3600539172 in
the amount of $150,000. This loan was assigned SBA loan No. 1094157902. A
third-party UCC handling charge of $100 was deducted from the loan amount prior
to disbursement. On or about June 12, 2020, an ACH transaction was completed via
interstate wires transferring $149,900 into Defendant 3RD & SHERMAN PLAZA,
L.L.C.’s account ending in -9367 at Mountain West Bank.

77. On or about, April 26, 2021, Defendant WILLIAM PHILIP
WERSCHLER submitted and caused to be submitted, via interstate wires, a request
for a modification of EIDL Application No. Application No. 3600539172-Mod-1
(SBA loan No. 1094157902) in the name Defendant 3RD & SHERMAN PLAZA,
L.L.C., and seeking additional EIDL funds.

78. On July 20, 2021, the SBA noted that Defendant 3RD & SHERMAN
PLAZA, L.L.C. tax records showed only $205,000 in income, which was over a 50%
variance from what was reported on the application. Accordingly, the SBA declined
to fund the application.

79. On or about July 28, 2021, C.C. texted Defendant WILLIAM PHILIP

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WERSCHLER and his wife, “I emailed the SBA yesterday to reconsider the 3rd and
Sherman increase since they denied it.” Defendant WILLIAM PHILIP
WERSCHLER replied, “Great. Thanks.” .

80. On or about October 25, 2021, Defendant WILLIAM PHILIP
WERSCHLER submitted or caused to be submitted to the SBA an amended tax
return changing the business revenues for Defendant 3RD & SHERMAN PLAZA,
L.L.C. The SBA then noticed, however, that the revenues for Defendant 3RD &
SHERMAN PLAZA, L.L.C. were not listed on a Schedule C form for profit and loss
from a business, but a Schedule E as supplemental income. On or about November
19, 2021, the SBA adjusted the numbers on the application to match the tax records
and to change the company from medical services to real estate.

81. On November 19, 2021, C.C. texted Defendant WILLIAM PHILIP
WERSCHLER, “For third and Sherman. The most they will do for the increase is
$410k — we already have $150k.” Defendant WILLIAM PHILIP WERSCHLER
replied, “That’s still great” and told C.C. to accept the amount.

82. As part of the modification process, on or about November 19, 2021,
Defendant WILLIAM PHILIP WERSCHLER electronically signed and caused to
be signed an Amended LA&A for the modification of EIDL Application No.
3600539172-Mod-1 (SBA loan No. 1094157902) and submitted it to the SBA via
interstate wires. In the Amended LA&A, Defendant WILLIAM PHILIP
WERSCHLER agreed, promised, and represented that Defendant 3RD &
SHERMAN PLAZA, L.L.C. would use the EIDL funds, “solely as working capital
to alleviate economic injury caused by disaster.” Defendant WILLIAM PHILIP
WERSCHLER also agreed, promised, and represented that he would not, without
prior written consent of the SBA, make any distribution of Defendant 3RD &
SHERMAN PLAZA, L.L.C.’s assets by way of loan, gift, bonus, or otherwise to any
company owner, partner, or employee, or to any company directly or indirectly
controlling, affiliated with, or controlled by Defendant 3RD & SHERMAN PLAZA,

INDICTMENT - 27
Case 2:24-cr-00141-TOR ECFNo.1 filed 10/18/24 PagelD.28 Page 28 of 40

L.L.C. In signing the Amended LA&A, Defendant WILLIAM PHILIP
WERSCHLER agreed to be bound by its terms and conditions.

83. On or about November 19, 2021, Defendant, WILLIAM PHILIP
WERSCHLER also electronically signed and caused to be signed an Amended
Security Agreement for Application No. 3600539172-Mod-1 (SBA loan No.
1094157902) and submitted it to the SBA via interstate wires. In the Amended
Security Agreement, Defendant WILLIAM PHILIP WERSCHLER agreed,
promised, and represented that none of the $410,200 in obligated EIDL funds “are
or will be primarily for personal, family, or household purposes.” Defendant
WILLIAM PHILIP WERSCHLER also represented in the Amended Security
Agreement that he had read and understood the meaning and effect all its terms.

84. Onorabout, November 22, 2021, as a result of the false representations,
pretenses, and promises made and caused to be made by Defendant WILLIAM
PHILIP WERSCHLER in the Amended Loan Authorization and Agreement and
Amended Security Agreement, the SBA approved the modification of Application
No. 3600539172-Mod-1 (SBA loan No. 1094157902), increasing the total EIDL
loan amount to $410,200. As such, the SBA authorized the disbursement of an
additional $260,200 to Defendant 3RD & SHERMAN PLAZA, L.L.C. On or about
November 24, 2021, the SBA, through the use of interstate wires, completed an EFT
from the FMS servers in Sterling, Virginia, of $260,200 in EIDL funding to
Defendant 3RD & SHERMAN PLAZA, L.L.C.’s bank account at Mountain West
Bank ending in -9367 located in Spokane, Washington. These funds were disbursed
solely for use by Defendant 3RD & SHERMAN PLAZA, L.L.C. as working capital
to alleviate economic injury caused by the COVID-19 disaster. Prior to the
disbursement of the EIDL funds, the account ending in -9367 had a balance of
approximately $12,333.71.

85. On January 11, 2022, Defendant WILLIAM PHILIP WERSCHLER
texted C.C., “Any other 2m loan extensions? 3 and Sherman, SDC? In play.” C.C.

INDICTMENT - 28
oN DO WO HR WY PO

Case 2:24-cr-00141-TOR ECFNo.1_ filed 10/18/24 PagelD.29 Page 29 of 40

replied, “3rd and Sherman is maxed out at $410k, we won’t get another increase.
No updates on SDC. Still processing but I haven’t had a loan officer reach out. I
don’t know if we can invest the eid| money. We can pay down debt and use the
funds for working capital.” C.C. then sent the following image showing SBA

information about the use of EIDL proceeds:

US Smal Rusiness MENU =
SBA isensrsice =

“A business may qualify for, both, an EIDL anda
physical disaster loan.

The maximum combined loan amount is $2
million. A separate SBA Disaster Assistance
program known as business physical disaster
loans covers property damage.

Use of proceeds

© Working capital and normal expenses such as
the continuation of health care benefits, rent,
utilities, and fixed debt payments

Terms

° The interest rate will not exceed 4%.

Maturity

© Up to 30 years, with repayment term to be
determined by ability to repay the loan

° No pre-payment penalty or fees nN

Back
to Top

@sba.gov

WILLIAM PHILIP WERSCHLER texted C.C., “Has to be a way. We can po the
warehouse loan but that’s not PCR.”

86. On or about January 19, 2022, check number 4288 to be drawn from
Defendant 3RD & SHERMAN PLAZA, L.L.C.’s account at Mountain West Bank
ending in -9367 to the order of Riverbank in the amount of $266,706.46 with the
memo “Pay Off for Loan #1942.” On or about January 19, 2022, this check was
used to pay off the entire remaining balance on Riverbank Loan No. 1942.

87. Records from Riverbank show that Loan No. 1942 was opened on or

INDICTMENT - 29
Case 2:24-cr-00141-TOR ECFNo.1 filed 10/18/24 PagelD.30 Page 30 of 40

about May 21, 2020, by Defendant WILLIAM PHILIP WERSCHLER as a business
line of credit in the amount of $275,000.00 in his own name. On or about May 21,
2020, Defendant WILLIAM PHILIP WERSCHLER drew the full $275,000.00 from
the line of credit, paying $146,154.70 to Riverbank Loan No. 1374, $123,960.13 to
Allegro Escrow, and another $4,885.17 for various real estate charges.

88. Records from Allegro Escrow show that it serviced payments for
property 6720 N. Pittsburg Street, purchased by Defendant WILLIAM PHILIP
WERSCHLER on or about April 27, 2017. These records also confirm that Allegro
Escrow received a wire from sender Defendant WILLIAM PHILIP WERSCHLER
on May 27, 2020, in the amount of $123,960.13 to pay off the account, which
corresponds with the disbursement from Riverbank loan number 1942. Loan
number 1942 was then paid off on or about January 19, 2022, with EIDL funds the
SBA provided to Defendant 3RD & SHERMAN PLAZA, L.L.C. on the
representation those funds would be used solely as working capital for that business.

89. Photos of 6720 N. Pittsburg St. from an April 28, 2020, real estate
evaluation inspection report file show that, while owned by Defendant WILLIAM
PHILIP WERSCHLER, the unit was used to store automobiles, jet skis, and a boat:

View of subject's interior looking NW of storage area.

INDICTMENT - 30
Case 2:24-cr-00141-TOR ECFNo.1 filed 10/18/24 PagelD.31 Page 31 of 40

COUNT 1

(Conspiracy to Commit Wire Fraud)

90. The allegations in paragraph 1 through 89 of this Indictment are
incorporated as though realleged herein. Furthermore, the allegations in each other
Count of this Indictment are hereby incorporated in this Count.

91. Beginning no later than in or about April 2020 and continuing until at
least July 2022, in the Eastern District of Washington, and elsewhere, Defendants
WILLIAM PHILIP WERSCHLER, SPOKANE DERMATOLOGY CLINIC, P.S.,
PREMIER CLINICAL RESEARCH, L.L.C., and 3RD & SHERMAN PLAZA,
L.L.C., and others known and unknown to the Grand Jury, knowingly and willfully
combined, conspired, and agreed to devise and participate in a scheme or plan to
defraud or obtain money or property by materially false or fraudulent pretenses,
representations, or promises, and thereby use or cause to be used an interstate wire,
in violation of 18 U.S.C. § 1343, all in violation of 18 U.S.C. § 1349.

COUNTS 2-18
(Wire Fraud)

92. The allegations in paragraphs 1 through 91 of this indictment are
incorporated as though realleged herein. Furthermore, the allegations in each other
Count of this Indictment are hereby incorporated in the Counts below.

93. On or about the dates below, Defendants WILLIAM PHILIP
WERSCHLER, SPOKANE DERMATOLOGY CLINIC, P.S., PREMIER
CLINICAL RESEARCH, L.L.C., and 3RD & SHERMAN PLAZA, L.L.C., and
others known and unknown to the Grand Jury, in the Eastern District of Washington
and elsewhere, for the purpose of executing the scheme described above, transmitted
and caused to be transmitted by means of wire communication in interstate
commerce the signals and sounds described below for each count, each transmission

constituting a separate count:
//

INDICTMENT - 31
Case 2:24-cr-00141-TOR ECF No. 1

filed 10/18/24 PagelD.32 Page 32 of 40

Count | Defendant(s) Date Description

2 WILLIAM April 26, | EIDL Modification Request submitted
PHILIP 2021 to the SBA for EIDL Application number
WERSCHLER: 33114961 34- od- 1 (SBA Loan No. 92346(

204), resulting in an interstate wire
and PREMIER transmission from the Eastern District
CLINICAL Washington the District of Iowa.
RESEARCH,
L.L.C.

3 WILLIAM July 21, Amended LA&A and Amended Security
PHILIP 2021 Agreement submitted to the SBA for
WERSCHLER: EIDL Application number 3311496154-

Mod-1 (SBA Loan No. 9234608204),
and PREMIER resulting in an interstate wire transmission
CLINICAL from the Eastern District of Washington
RESEARCH, the District of Iowa.
L.L.C.

4 WILLIAM July 27, EFT disbursement of $350,000 to
PHILIP 9021 Mountain West Bank account ending -
WERSCHLER: 7658, Tesulting in an interstate wire

transmission into the Eastern District of
and PREMIER Washington from outside the District.
CLINICAL
RESEARCH,
L.L.C.

5 WILLIAM August $400,000 wire transfer from Riverbank
PHILIP 24,2021 | account ending -4229 to Mountain West
WERSCHLER; Bank account ending -9367, resulting in
3RD & an interstate wire transmission from the
SHERMAN E District of Washi id
PLAZA, L.L.C.; astern District of Washington to outside
and SPOKANE the District.

DERMATOLOGY
CLINIC, P.S.

INDICTMENT - 32
Case 2:24-cr-00141-TOR

ECF No.1 filed 10/18/24 PagelD.33 Page 33 of 40

6 WILLIAM August $566,720.87 wire transfer from Mountain
PHILIP 25,2021 | West Bank account ending -9367 to First
WERSCHLER: American Title Company, resulting in an

interstate wire transmission from the
and 3RD & Eastern District of Washington to outside
SHERMAN the District.

PLAZA, L.L.C.

7 WILLIAM September | Second EIDL Modification Request
PHILIP 12,2021 | submitted to the SBA for EIDL
WERSCHLER: Application number 331 1496154-Mod-2

(SBA Loan No. 9234608204), resulting in
and PREMIER an interstate wire transmission from the
CLINICAL Eastern District of Washington the District
RESEARCH, of Iowa.

L.L.C.

8 WILLIAM January 6, | Amended LA&A and Amended Security
PHILIP 2022 Agreement submitted to the SBA for

EIDL Application number 3311496154-
WERSCHLER;

Mod-2 (SBA Loan No. 9234608204),
and PREMIER resulting in an interstate wire transmission
CLINICAL from the Eastern District of Washington
RESEARCH, the District of Iowa.

L.L.C.

9 WILLIAM January |EFT disbursement of $1,500,000 to
PHILIP 11,2022 | Mountain West Bank account ending -
WERSCHLER: 7658, Tesulting in an interstate . wire

transmission into the Eastern District of
and PREMIER Washington from outside the District.
CLINICAL
RESEARCH,

L.L.C.

10 WILLIAM January $252,375.00 wire transfer from Riverban
PHILIP 31, 2022 | k account ending -4229 to Ryan Friedman
WERSCHLER: Motor Cars L.L.C., resulting in an

INDICTMENT - 33
Case 2:24-cr-00141-TOR ECF No. 1

filed 10/18/24 PagelD.34 Page 34 of 40

PREMIER interstate wire transmission from the
CLINICAL Eastern District of Washington to outside
RESEARCH, the District.

L.L.C.; and

SPOKANE

DERMATOLOGY

CLINIC, P.S.

1] WILLIAM July 29, $533,143.13 wire transfer from Mountain
PHILIP 2022 West Bank account ending -7658 to
WERSCHLER: Stamper Rubens, PS., resulting in an

interstate wire transmission from the
PREMIER Eastern District of Washington to outside
CLINICAL the District.
RESEARCH,
L.L.C.; and 3RD
& SHERMAN
PLAZA, L.L.C.

12 WILLIAM June 15, | EIDL Modification Request submitted to
PHILIP 2021 the SBA for EIDL Application number
WERSCHLER: 3310708609- od- (SBA Loan No. 21969

78206), resulting in an interstate wire
and SPOKANE transmission from the Eastern District of
DERMATOLOGY Washington the District of Iowa.

CLINIC, P.S.

13 WILLIAM September | Amended LA&A and Amended Security
PHILIP 28,2021 | Agreement submitted to the SBA for
WERSCHLER;: EIDL Application number 3310708609-

Mod-1 (SBA Loan No. 2196978206),
and SPOKANE resulting in an interstate wire transmission
DERMATOLOGY from the Eastern District of Washington
CLINIC, P.S. the District of Iowa.

14 WILLIAM October 5, | EFT disbursement of $350,00 to
PHILIP 2021 Riverbank account ending -4229, resulting

INDICTMENT - 34
Case 2:24-cr-00141-TOR ECF No. 1

filed 10/18/24 PagelD.35 Page 35 of 40

WERSCHLER; in an interstate wire transmission into the
and SPOKANE Eastern District of Washington from
DERMATOLOGY outside the District.

CLINIC, P.S.

15 WILLIAM October | Second EIDL Modification Request
PHILIP 12,2021 | Submitted to the SBA for EIDL Application
WERSCHLER: number 33 10708609-Mod-2 (SBA

Loan No. 2196978206), resulting in an
and SPOKANE interstate wire transmission from the
DERMATOLOGY Eastern District of Washington the District
CLINIC, P.S. of Iowa.

16 WILLIAM April 26, | EIDL Modification Request submitted to
PHILIP 2021 the SBA for EJIDL Application number
WERSCHLER: 3600539172-Mod-1 _

(SBA Loan No. 1094157902), resulting in
and 3RD & an interstate wire transmission from the
SHERMAN Eastern District of Washington the District
PLAZA, L.L.C. of Iowa.

17 WILLIAM November | Amended LA&A and Amended Security
PHILIP 19,2021 | Agreement submitted to the SBA for
WERSCHLER: EIDL Application number 3600539172-

Mod-1 (SBA Loan No. 1094157902),
and 3RD & resulting in an interstate wire transmission
SHERMAN from the Eastern District of Washington
PLAZA, L.L.C. the District of Iowa.

18 WILLIAM November | EFT disbursement of $260,200 to
PHILIP 24,2021 | Mountain West Bank account ending -
WERSCHLER: 9367, resulting in an interstate wire

transmission into the Eastern District of
and 3RD & Washington from outside the District.
SHERMAN
PLAZA, L.L.C.

INDICTMENT - 35

All in violation of 18 U.S.C. § 1343.
Case 2:24-cr-00141-TOR ECFNo.1 filed 10/18/24 PagelD.36 Page 36 of 40

COUNTS 19 — 23

(False, Fictitious, or Fraudulent Claims)

94. The allegations in paragraphs 1 through 93 of this Indictment are
incorporated as though realleged herein. Furthermore, the allegations in each other
Count of this Indictment are hereby incorporated in these Counts.

95. Onor about each of the dates set forth below, in the Eastern District of
Washington, the Defendants WILLIAM PHILIP WERSCHLER, SPOKANE
DERMATOLOGY CLINIC, P.S., PREMIER CLINICAL RESEARCH, L.L.C., and
3RD & SHERMAN PLAZA, L.L.C., made and presented to the United States Small
Business Administration claims concerning EIDL applications, knowing said claims
were false and fraudulent, and knowing the information submitted was materially
false and fraudulent, described below for each count, each claim constituting a

separate count:

Count | Defendant(s) Date Description

19 WILLIAM PHILIP April 26, 2021 | EIDL Modification Request
WERSCHLER; and submitted to the SBA for EIDL

Application number
PREMIER CLINICAL

3311496154-Mod-1 (SBA Loan
RESEARCH, L.L.C. No. 9234608204)

20 WILLIAM PHILIP September 12, | Second EIDL Modification
WERSCHLER; and 2021 Request submitted to the SBA
PREMIER CLINICAL for EIDL Application number

3311496154-Mod-2 (SBA Loan
RESEARCH, L.L.C. No. 9234608204)
21 WILLIAM PHILIP June 15,2021 | EIDL Modification Request
WERSCHLER; and submitted to the SBA for EIDL
Application number
SPOKANE
3310708609-Mod-1 (SBA Loan
DERMATOLOGY No. 2196978206)
CLINIC, P.S.

INDICTMENT - 36
Case 2:24-cr-00141-TOR ECF No. 1

filed 10/18/24 PagelD.37 Page 37 of 40

22 WILLIAM PHILIP
WERSCHLER; and
SPOKANE
DERMATOLOGY
CLINIC, P.S.

October 12,
2021

Second EIDL Modification
Request submitted to the SBA
for EIDL Application number
33 10708609-Mod-2 (SBA Loan
No. 2196978206)

23 WILLIAM PHILIP
WERSCHLER; and
3RD & SHERMAN

PLAZA, L.L.C.

April 26, 2021

EIDL Modification Request
submitted to the SBA for EIDL
Application number
3600539172-Mod-1 (SBA Loan
No. 1094157902)

All in violation of 18 U.S.C. §§ 287, 2.
NOTICE OF CRIMINAL FORFEITURE ALLEGATIONS

The allegations set forth in this Indictment are hereby realleged and

incorporated herein by this reference for the purpose of alleging forfeitures.
Pursuant to 18 U.S.C. § 981(a)(1)(C) and 28 U.S.C. § 2461(c), upon
conviction of the wire fraud offenses in violation of 18 U.S.C. §§ 1343, 1349, and/or
18 U.S.C. § 1343, as set forth in this Indictment, the Defendants, WILLIAM PHILIP
WERSCHLER, SPOKANE DERMATOLOGY CLINIC, P.S., PREMIER
CLINICAL RESEARCH, L.L.C., and 3RD & SHERMAN PLAZA, L.L.C., shall

forfeit to the United States any property, real or personal, which constitutes or is

derived from proceeds traceable to the offense. The property to be forfeited includes,

but is not limited to, the following:

MONEY JUDGMENT

A sum of money in United States currency, representing the amount of

proceeds obtained by the Defendants as a result of the wire fraud violations.

REAL PROPERTIES:

Real property known as 324 and 328 South Grant Street, Spokane,
Washington, legally described as follows:

INDICTMENT - 37
Case 2:24-cr-00141-TOR ECFNo.1 filed 10/18/24 PagelD.38 Page 38 of 40

Lots 5 and 6, Block 4, Chandler’s Addition, as per Plat
recorded in Volume “A” of Plats, Page 183; Situate in the City of Spokane,
County of Spokane, State of Washington.

Together with all appurtenances, fixtures, attachments, and

improvements thereto and thereupon.

Subject to all easements, restrictions, reservations and covenants of

record.

Tax Parcel Nos. 35202.3205 and 35202.3206

Real property known as 6720 North Pittsburg Street, Spokane,
Washington, legally described as follows:

Unit N. 6720, Main Floor, lst Amended Lyons Park Warehouse
Condominium, Phase 1 Warehouse, a Condominium, according to
Declaration thereof recorded under Spokane County recording No. 5349122;
Said Unit is located on Survey Map and Plans filed in Volume 7 of
Condominiums, at Page 87A, in the City of Spokane, Spokane County,
Washington.

Together with all appurtenances, fixtures, attachments and

improvements thereto and thereupon.

Subject to all easements, restrictions, reservations and covenants of

record.

Tax Parcel No. 36283.2924
Real property known as 7611 East Medlock Drive, Scottsdale, Arizona,

legally described as follows:

INDICTMENT - 38
o ON DBD OH FP W NO

Case 2:24-cr-00141-TOR ECFNo.1 filed 10/18/24 PagelD.39 Page 39 of 40

Unit 26, of Scottsdale in Towne Villas according to the Declaration of
Horizontal Property Regime recorded August 11, 1977 in Docket 12368, Page
631; and amended in Docket 12614, Page 27; and Notice of Policy on
Insurance recorded as 2012-0218388; and second amendment recorded as
2020-0793360, of official records and per map recorded August 11, 1977 as
Book 192 of Maps, Page 6; and amended December 21, 1977 as Book 195 of
Maps, Page 6, the Office of the County Recorder of Maricopa County,
Arizona.

Together with a proportionate interest in and to the common areas, as set forth

in said Declaration of Horizontal Property Regime and as shown on said Plat.

Together with all appurtenances, fixtures, attachments and improvements

thereto and thereupon.

Subject to existing taxes, assessments, covenants, conditions, restrictions,

rights of way, easements and all other matters of record.

A.P.N.: 173-78-341

CONVEYANCES

- a1997 Porsche Carrera, VIN: WP0CA2996VS342006,

- a2011 Porsche 911 GT3, VIN: WPOAC2A97BS783331

If any of the forfeitable property described above, as a result of any act or

omission of the Defendants:

a. cannot be located upon the exercise of due diligence;

b. has been transferred or sold to, or deposited with, a third party;

c. has been placed beyond the jurisdiction of the court;

d. has been substantially diminished in value; or

e. has been commingled with other property which cannot be divided

without difficulty,

INDICTMENT - 39
bo

Case 2:24-cr-00141-TOR ECFNo.1 filed 10/18/24 PagelD.40 Page 40 of 40

the United States of America shall be entitled to forfeiture of substitute property
pursuant to 21 U.S.C. § 853(p), as incorporated by 18 U.S.C. § 981(b)(1) and 28
U.S.C. § 2461(c).

DATED this | 1 day of October, 2024.

A TRUE BILL

Vanessa R. Waldref
United States Attorney

Dan Fruch
Assistant United States Attorney

| Jeremy J. Keley~
Assistant United States Attorney

INDICTMENT - 40


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