Information — United States v. Yordanis Perez Velazquez, Northern District of Iowa (Document 83)

Summary

An Information filed April 5, 2024, as Document 83 in United States v. Yordanis Perez Velazquez, No. 24-CR-3013, in the U.S. District Court for the Northern District of Iowa, Central Division. Count 1 charges Wire Fraud under 18 U.S.C. § 1343. After background on COVID-19, the national emergency and the Paycheck Protection Program, it alleges that in about July and August 2020 the defendant and others caused applications to be filed with participating lenders for PPP loans in exchange for a fee, supported by fictitious Schedule C forms. Count 1 alleges that on or about July 31, 2020, the defendant received $3,000 by means of two interstate wire transfers from Individual-34.

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“Information — United States v. Yordanis Perez Velazquez, Northern District of Iowa (Document 83).” Original at storage.courtlistener.com. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/information-no-3-24-cr-03013-dkt-83-n-d-iowa-8fa945ccbf/, SHA-256 0bb564b6e1da839df2e4f9d43109dc4320ad8ae74b05412530687a6de1afaa79.

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IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF IOWA
CENTRAL DIVISION

UNITED STATES OF AMERICA, ) No. 24-CR-3013
)
Plaintiff, ) INFORMATION
)
vs. ) Count 1
) 18 U.S.C. § 1343: Wire Fraud
YORDANIS PEREZ VELAZQUEZ, )
)
Defendant. )

The United States Attorney charges:

Count 1

Wire Fraud

Introduction

COVID-19 and the National Emergency

1. According to the United States Centers for Disease Control and

Prevention (“CDC”), Coronavirus Disease 2019 (“COVID-19”) is a respiratory illness

that can spread from person to person. The virus that causes COVID-19 is a novel

coronavirus that was first identified during an investigation into a 2019 outbreak in

Wuhan, China. COVID-19 can attack human lungs and kill infected persons,

especially those who have certain risk factors identified by the CDC.

2. On March 13, 2020, then-President Donald J. Trump issued a

Proclamation on Declaring a National Emergency Concerning the Novel

Coronavirus Disease (COVID-19) Outbreak (“the Emergency Proclamation”). The

Emergency Proclamation noted that “on March 11, 2020, the World Health

Case 3:24-cr-03013-LTS-KEM Document 83 Filed 04/05/24 Page 1 of 5
Organization announced that the COVID-19 outbreak can be characterized as a

pandemic, as the rates of infection continue to rise in many locations around the

world and across the United States.” Further, “[t]he spread of COVID -19 within

our Nation’s communities threatens to strain our Nation’s healthcare systems.”

The Paycheck Protection Program

3. The Coronavirus Aid, Relief, and Economic Security (“CARES”) Act is a

federal law enacted in late March 2020 that provides emergency financial

assistance to the millions of Americans who are suffering the economic effects of the

COVID-19 pandemic. One form of such financial assistance is the authorization of

up to $349 billion in forgivable loans to small businesses for job retention and

certain other expenses, through a program referred to as the Paycheck Protection

Program (“PPP”). Later, in April 2020, Congress authorized an additional $300

billion in PPP funding and, in March 2021, extended the PPP application deadline

through May 31, 2021.

4. In order to obtain a PPP loan, a business submits a PPP loan

application (SBA Form 2483), which must be signed by an authorized

representative of the business. The loan application requires the business, through

its authorized representative, to acknowledge the PPP program rules and to make

certain affirmative certifications regarding its eligibility. In the application, the

small business’s authorized representative must also provide, among other things,

the business’s average monthly payroll expenses and number of employees. These

figures are used to calculate the business’s eligibility and the amount of money it

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may receive under the PPP. In addition, businesses applying for a PPP loan must

provide documentation showing their payroll expenses.

5. A PPP loan application must be processed by a participating lending

financial institution. If a PPP loan application is approved by the participating

financial institution, that institution funds the PPP loan using its own monies,

which are 100% guaranteed by the Small Business Administration (SBA).

Participating financial institutions require that the information provided in PPP

loan applications be truthful, including supporting tax forms and information about

the applicant business’s employees and payroll expenses, which is material to the

financial institution’s approval and the terms of the PPP loans.

6. Information from the application, including information about the

borrower, the total amount of the loan, and the listed number of employees, is

transmitted by the lending financial institution to the SBA in the course of

processing the loan.

7. PPP loan proceeds must be used by the business for certain

permissible expenses – payroll costs, interest on mortgages, rent, and utilities. The

PPP allows the principal and interest on the PPP loan to be entirely forgiven if the

business spends the loan proceeds on these items within a designated period of

time, usually within twenty-four weeks of receiving the proceeds, and if the

business also uses at least 60% of the PPP loan proceeds for payroll expenses.

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The Scheme to Defraud

8. In about July and August 2020, in the Northern District of Iowa and

elsewhere, defendant YORDANIS PEREZ VELAZQUEZ and others known and

unknown to the United States Attorney did voluntarily and intentionally (1)

participate in a scheme and artifice to defraud with knowledge of its fraudulent

nature and (2) obtain money and property by means of false and fraudulent

pretenses, representations, and promises (collectively, “the scheme to defraud”).

Manner and Means of the Scheme to Defraud

9. It was part of the scheme to defraud that YORDANIS PEREZ

VELAZQUEZ and others known and unknown to the United States Attorney caused

applications to be filed with participating lenders for PPP loans in exchange for a

fee. It was also part of the scheme to defraud that false, fraudulent, and fictitious

documents and statements were submitted to various lending institutions in

support of the PPP loans for the PPP applicants. For example, co-schemers would

submit and cause to be submitted for the PPP applicants a fictitious Schedule C,

Form 1040, Profit or Loss From Business for 2019, which would contain false and

fraudulent statements about the PPP applicants’ occupations, gross receipts and

sales, gross income, and expenses. After the PPP applicants received the fraudulent

PPP loans, it was part of the scheme to defraud that co-schemers demanded a

portion of the PPP moneys from the PPP applicants, which often was paid by means

interstate wire transfer.

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Execution of the Scheme to Defraud

Count 1: On or about July 31, 2020, for the purpose of executing the

scheme to defraud described above, defendant YORDANIS PEREZ VELAZQUEZ

received $3,000 by means of two interstate wire transfers from Individual-34.

This was in violation of Title 18, United States Code, Section 1343.

TIMOTHY T. DUAX
United States Attorney

By: /s/ Timothy L. Vavricek

TIMOTHY L. VAVRICEK
Assistant United States Attorney

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