Indictment — United States v. Clifton Pape and Sally Jung, Eastern District of Texas (Document 25)
Summary
An indictment in United States of America v. Clifton Pape and Sally Jung, Case 5:21-cr-00008-RWS-JBB, in the U.S. District Court for the Eastern District of Texas, Texarkana Division, filed February 10, 2021 as Document 25. Count One charges conspiracy to commit telemarketing wire fraud victimizing ten or more persons over the age of fifty-five, under 18 U.S.C. §§ 1349 and 2326. The grand jury alleges that Pape and Jung, operating as My Buddy Loans, falsely told others that a $10,000.00 agricultural grant was available, charged fees, and submitted EIDL applications with false employee numbers. Counts Two through Five charge wire fraud under 18 U.S.C. § 1343 and Counts Six through Nine aggravated identity theft under 18 U.S.C. §§ 1028A and 2. Forfeiture is sought of $505,535.04 and a sum of money equal to $175,175.27.
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“Indictment — United States v. Clifton Pape and Sally Jung, Eastern District of Texas (Document 25).”
Original at archive.org. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/indictment-no-5-21-cr-00008-dkt-25-e-d-tex-b15549eb80/
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Case 5:21-cr-00008-RWS-JBB Document 25 Filed 02/10/21 Page 1 of 12 PageID #: 68
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF TEXAS
TEXARKANA DIVISION
UNITED STATES OF AMERICA
No. 5:21-CR-
JUDGE SCHROEDER
21
CLIFTON PAPE (1)
SALLY JUNG (2)
INDICTMENT FILED
THE UNITED STATES GRAND JURY CHARGES: FEB 1 0 2021
CLERK, U.S, DISTRICT COURT
INTRODUCTION
EASTERN DISTRICT OF TEXAS
1. On March 13, 2020, President Donald J. Trump declared an
emergency under Section 501(b) of the Robert T. Stafford Disaster Relief and
Emer ency Assistance Act (Stafford Act; 42 U.S.C. §§ 5121 et seq.) in response
to coronavirus disease 2019 (COVID-19). Two weeks later, President Trump
signed the Coronavirus Aid, Relief, and Economic Security ( CARES ) Act into
law. The CARES Act was designed to provide emergency financial assistance
to the millions of Americans suffering the economic effects caused by the
COVID-19 pandemic.
2. One source of relief provided by the CARES Act was the EIDL
program, which was designed to provide assistance to businesses suffering
temporary loss of revenue resulting from the pandemic. The EIDL program is
overseen by the United States Small Business Administration (“SBA ), which
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has authority over all such loans. EIDL loans are processed outside the State
of Texas. According to the SBA website (www.sba. ov), the stated purpose of
an EIDL loan is [t]o meet financial obligations and operating expenses that
could have been met had the disaster not occurred. EIDL loans are low
interest loans and are not forgivable.
3. Under the EIDL program, applicants were eligible for a forgivable
advance of up to $10,000 if the applicant had ten or more employees. The
advance amount was based on the number of employees reported by a business.
An applicant could receive $1000 per employee up to $10,000. The SBA
required an applicant to provide specific information at the time the
application was made, including the number of employees, revenue, and cost
of goods. An EIDL applicant could apply through a third-party processor,
which was permitted to charge a reasonable fee.
COUNT ONE
Violation: 18 U.S.C. §§ 1349 and 2326
(Conspiracy to commit telemarketing wire
fraud victimizing ten or more persons over
the age of fifty-five)
4. Paragraphs 1 through 3 above are realleged and incorporated by
reference as though fully set forth herein.
5. Beginning in or before May 2020 and continuing through in or
about January 2021, the exact dates being unknown to the Grand Jury, in the
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Eastern Distric of Texas and elsewhere, the defendants, CLIFTON PAPE and
SALLY JUNG, along with others, both known and unknown to the Grand Jury,
did knowin ly and willfully combine, conspire, confederate, and agree to
violate 18 U.S.C. § 1343, wire fraud, that is to transmit and cause to be
transmitted by means of wire communication in interstate and foreign
commerce any writings, signs, signals, pictures, and sounds for the purpose of
executing a scheme and artifice to defraud and for obtaining money and
property by means of false and fraudulent pretenses, representations, and
promises, having done so in connection with the conduct of telemarketing and
having victimized ten or more persons over the age of fifty-five and having done
so in relation to and involving a benefit authorized, transported, transmitted,
transferred, disbursed, and paid in connection with, a presidentially declared
major disaster or emergency, as those terms are defined in section 102 of the
Robert T. Stafford Disaster Relief and Emergency Assistance Act
(42 U.S.C. § 5122).
PURPOSE OF THE CONSPIRACY
6. It was the general purpose of the conspiracy for PAPE and JUNG
and their co-conspirators to unlawfully and unjustly enrich themselves by
obtaining money from the EIDL program by means of materially false and
fraudulent pretenses, representations, and promises.
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MANNER AND MEANS
7. The manner and means by which the defendants and their co¬
conspirators sought to accomplish the objects and purpose of the conspiracy
included, amon others, the following:
a. PAPE and JUNG operated under the name My Buddy
Loans.
b. PAPE and JUNG falsely represented to others that a
$10,000.00 agricultural grant was available from the United
States government.
c. PAPE and JUNG used the internet to transmit EIDL
application information from Liberty County, Texas, to a
location outside the State of Texas.
d. PAPE and JUNG submitted EIDL applications that
contained false information, including the number of
employees.
e. PAPE and JUNG charged others a fee via a credit or debit
card processed through Square.
f. PAPE and JUNG transferred the fee proceeds from Square
to a Wells Fargo Bank account in the name of WorkingJU
Inc. with an account number ending in 9808.
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g. PAPE and JUNG en a ed in the conduct of telemarketing
and email marketing.
h. PAPE and JUNG victimized ten or more persons over the
age of fifty-five.
All in violation of 18 U.S.C. §§ 1349 and 2326.
COUNTS TWO THROUGH FIVE
Violation: 18 U.S.C. § 1343
(Wire fraud)
8. Paragraphs 1 through 7 above are realleged and incorporated by
reference as though fully set forth herein, as constituting and describing the
defendants scheme and artifice to defraud and to obtain money from the EIDL
program by means of materially false and fraudulent pretenses,
representations, and promises.
ACTS IN EXECUTION OF THE SCHEME AND ARTIFICE
9. On or about the dates listed below, in Liberty County, in the
Eastern District of Texas and elsewhere, the defendants, CLIFTON PAPE and
SALLY JUNG, acting in concert with each other and others, known and
unknown to the Grand Jury, for the purpose of executing the scheme described
above, and attempting to do so, knowingly transmitted and caused to be
transmitted by means of wire communication in interstate commerce a signal,
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that is, EIDL application information pertaining to the individuals listed
below, each transmission constitutin a separate count:
Count Date Individual
2 22-Jun-2020 T.G.
3 25-Jun-2020 J.B.
4 26-Jun-2020 J.M.
5 30-Jun-2020 T.M.
All in violation of 18 U.S.C. § 1343.
COUNTS SIX THROUGH NINE
Violation: 18 U.S.C. §§ 1028A and 2
(Aggravated identity theft and aiding and
abetting)
10. Paragraphs 1 through 3 above are realleged and incorporated by
reference as though fully set forth herein.
11. On or about the dates listed below, in the Eastern District of Texas
and elsewhere, the defendants, CLIFTON PAPE and SALLY JUNG, acting in
concert with and aided and abetted by each other and others, known and
unknown to the Grand Jury, did, without lawful authority, knowingly transfer,
possess, and use, a means of identification of another person, that is the name,
Social Security number, and date of birth of the individuals listed below,
during and in relation to a felony violation enumerated in
18 U.S.C. § 1028A(c), that is, wire fraud, in violation of 18 U.S.C. § 1343, as
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alleged in Counts Two throu h Five, knowing that the means of identification
belonged to another actual person:
Count Date Individual
6 22-Jun-2020 T.G.
7 25-Jun-2020 J.B.
8 26-Jun-2020 J.M.
9 30-Jun-2020 T.M.
In violation of 18 U.S.C. §§ 1028A(a)(l) and 2.
NOTICE OF INTENT TO SEEK CRIMINAL FORFEITURE
18 U.S.C. 981(a)(1)(C) and 2328 and 28 U.S.C. § 2461(c)
12. Paragraphs 1 through 9 above are realleged and incorporated by
reference as though fully set forth herein for the purpose of alleging forfeiture
to the United States of America of certain property in which the defendants
have an interest.
13. Upon conviction of any violation of 18 U.S.C. §§ 1343 or 1349, the
defendants, CLIFTON PAPE and SALLY JUNG, shall forfeit to the United
States any property, real or personal, that constitutes or is derived from
proceeds traceable to a violation of any offense constituting specified unlawful
activity, or a conspiracy to commit such offense, pursuant to
18 U.S.C. § 981(a)(1)(C) and 28 U.S.C. § 2461(c).
14. Upon conviction of any violation for which an enhanced penalty is
provided under 18 U.S.C. § 2326, the defendants, CLIFTON PAPE and SALLY
JUNG, shall forfeit to the United States any property, real or personal,
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constituting or traceable to ross proceeds obtained from such offense, and any
equipment, software, or ot er technology used or intended to be used to commit
or to facilitate the commission of such offense, pursuant to 18 U.S.C. § 2328.
15. The property which is subject to forfeiture, includes but is not
limited to the following:
United States Currency:
The $505,535.04 in United States currency seized on January 12,
2021, from the Wells Fargo Bank account in the name of
Working4U Inc. with an account number ending in 9808.
Cash Proceeds:
A sum of money equal to $175,175.27 in United States currency
and all interest and proceeds traceable thereto, representing the
amount of proceeds obtained by the defendants as a result of the
offenses alleged in this indictment, for which the defendants are
personally liable.
16. Pursuant to 21 U.S.C. § 853(p), as incorporated by reference by
18 U.S.C. § 982(b), if any of the forfeitable property, or any portion thereof, 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;
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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
subdivided without difficulty;
it is the intent of the United States to seek the forfeiture of other property of
the defendants up to the value of the above-described forfeitable properties,
includin , but not limited to, any identifiable property in the names of
CLIFTON PAPE and SALLY JUNG.
17. By virtue of the commission of the offenses alleged in this
indictment, any and all interest the defendants have in the above-described
property is vested in the United States and hereby forfeited to the United
States pursuant to 18 U.S.C. §§ 981(a)(1)(C), 982(a)(3), and 2328 and
28 U.S.C. § 2461(c).
All pursuant to 18 U.S.C. §§ 981(a)(1)(C) and 2328 and
28 U.S.C. § 2461(c), and the procedures set forth at 21 U.S.C. § 853, as made
applicable through 18 U.S.C. § 982(b)(1).
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A TRUE BILL
GRAND JURY FOREPERSON
NICHOLAS J. GANJEI
ACTING UNITED STATES ATTORNEY
ssistant United States ttorney
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IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF TEXAS
TEXARKANA DIVISION
UNITED STATES OF AMERICA §
V. § No. 5:21-CR-
§ JUDGE SCHROEDER
CLIFTON PAPE (1)
SALLY JUNG (2) §
NOTICE OF PENALTY
COUNT ONE
Violation: 18 U.S.C. §§ 1349 and 2326
(Conspiracy to commit telemarketin wire fraud
victimizing ten or more persons over the a e of fifty-
five)
Penalty: Imprisonment for not more than thirty years; a fine
not to exceed the greatest of $1,000,000, twice the
ross gain, and twice the ross loss; and a term of
supervised release of not more than five years.
If the offense is connected to the conduct of
telemarking or email marketing, then the defendant
shall be imprisoned for a term of up to five years in
addition to any term of imprisonment imposed under
18 U.S.C. § 1349.
If the offense is connected to the conduct of
telemarking or email marketin and the offense
victimized ten or more persons over the age of fifty-five
or targeted persons over the age of fifty-five, then the
person shall be imprisoned for a term of up to ten years
in addition to any term of imprisonment imposed
under 18 U.S.C. § 1349.
Special Assessment: $100.00
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COUNTS TWO THROUGH FIVE
Violation: . 18 U.S.C. § 1343
(Wire fraud)
Penalty: Imprisonment for not more than thirty years; a fine
not to exceed the reatest of $1,000,000, twice the
gross gain, and twice the gross loss; and a term of
supervised release of not more than five years.
Special Assessment: $100.00 for each count
COUNTS SIX THROUGH NINE
Violation: 18 U.S.C. §§ 1028A and 2
(Aggravated identity theft and aiding and abetting)
Penalty: Imprisonment of two years and a fine of $250,000 and
a term of supervised release of not more than one year.
This sentence is to run consecutively to any other
sentence imposed. A person convicted of a violation of
this section shall not be placed on probation.
Special Assessment: $100.00 for each count
Indictment and Notice of Penalty Page 12 of 12
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