United States v. Keith Nicoletta — Plea Agreement, Middle District of Florida (Document 27)

Summary

A plea agreement in United States of America v. Keith Nicoletta, Case No. 8:21-cr-6-T-35AAS, in the U.S. District Court for the Middle District of Florida, filed January 13, 2021 as Document 27. The defendant agrees to plead guilty to Count One of the Information, money laundering conspiracy under 18 U.S.C. § 1956(h), which carries a maximum of twenty years' imprisonment and a fine of up to $500,000, or twice the value of the property involved in the transaction, whichever is greater. He agrees to restitution in the approximate amount of $1,903,157, jointly and severally with his coconspirators, with the final amount to be determined by the Court, and to cooperate with the United States. He agrees to forfeit the $1,903,157 in proceeds and assets including a 2020 Mercedes-Benz, a 2020 Ford Super Duty F-250 Platinum Edition and a Rolex watch.

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Case 8:21-cr-O0006-MSS-AAS Document 27 Filed 01/13/21 Page 1 of 29 PagelD 60

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UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA

TAMPA DIVISION
UNITED STATES OF AMERICA
v. CASE NO. 8:21-cr-6-T-35AAS
KEITH NICOLETTA
PLEA AGREEMENT

Pursuant to Fed. R. Crim. P. 1 1(c), the United States of America, by Maria
Chapa Lopez, United States Attorney for the Middle District of Florida, and the
defendant, Keith Nicoletta, and the attorney for the defendant, Bjorn Brunvand,
mutually agree as follows:

A. — Particularized Terms
1. Count Pleading To

The defendant shall enter a plea of guilty to Count One of the
Information. Count One charges the defendant with money laundering
conspiracy, in violation of 18 U.S.C. § 1956(h).

| 2. Maximum Penalties

Count One carries a maximum sentence of twenty years’
imprisonment; a fine of up to $500,000, or twice the value of the property
involved in the transaction, whichever is greater; a term of supervised release of

- up to five years; and a special assessment of $100.

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3. Elements of the Offense

The defendant acknowledges understanding the nature and
elements of the offense with which defendant has been charged and to which
defendant is pleading guilty. The elements of Count One are:

First: two or more people agreed to try to

accomplish a common and unlawful plan to

violate 18 U.S.C. § 1956; and

Second: the defendant knew about the plan’s unlawful
purpose and voluntarily joined in it.

4. Indictment Waiver

Defendant will waive the right to be charged by way of

indictment before a federal grand jury.
5. No Further Charges

If the Court accepts this plea agreement, the United States
Attorney's Office for the Middle District of Florida agrees not to charge
defendant with committing any other federal criminal offenses known to the
United States Attorney's Office at the time of the execution of this agreement,
related to the facts described in this plea agreement.

6. Mandatory Restitution to Victim of Offense of Conviction

Pursuant to 18 U.S.C. § 3663A(a), defendant agrees to make full
restitution to the victims of the conspiracy described in Count One, in the

approximate amount of $1,903,157 to be paid jointly and severally with his

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coconspirators. The defendant acknowledges that the final restitution amount
will be determined by the Court at the time of sentencing.

7. Guidelines Sentence

Pursuant to Fed. R. Crim. P. 11(c)(1)(B), the United States will
recommend to the Court that the defendant be sentenced within the
defendant’s applicable guidelines range as determined by the Court pursuant
to the United States Sentencing Guidelines, as adjusted by any departure the
United States has agreed to recommend in this plea agreement. The parties
understand that such a recommendation is not binding on the Court and that,
if it is not accepted by this Court, neither the United States nor the defendant
will be allowed to withdraw from the plea agreement, and the defendant will
not be allowed to withdraw from the plea of guilty.

8. Acceptance of Responsibility - Three Levels

At the time of sentencing, and in the event that no adverse
information is received suggesting such a recommendation to be unwarranted,
the United States will not oppose the defendant’s request to the Court that the
defendant receive a two-level downward adjustment for acceptance of
responsibility, pursuant to USSG §3E1.1(a). The defendant understands that

this recommendation or request is not binding on the Court, and if not

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accepted by the Court, the defendant will not be allowed to withdraw from the
plea.

Further, at the time of sentencing, if the defendant's offense level
prior to operation of subsection (a) is level 16 or greater, and if the defendant
complies with the provisions of USSG §3E1.1(b) and all terms of this Plea
Agreement, including but not limited to, the timely submission of the financial
affidavit referenced in Paragraph B.5., the United States agrees to file a motion
pursuant to USSG §3E1.1(b) for a downward adjustment of one additional
level. The defendant understands that the determination as to whether the
defendant has qualified for a downward adjustment of a third level for
acceptance of responsibility rests solely with the United States Attorney for the
Middle District of Florida, and the defendant agrees that the defendant cannot
and will not challenge that determination, whether by appeal, collateral attack,
or otherwise.

9. Cooperation - Substantial Assistance to be Considered

Defendant agrees to cooperate fully with the United States in the
investigation and prosecution of other persons, and to testify, subject to a
prosecution for perjury or making a false statement, fully and truthfully before
any federal court proceeding or federal grand jury in connection with the

charges in this case and other matters, such cooperation to further include a

a

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full and complete disclosure of all relevant information, including production
of any and all books, papers, documents, and other objects in defendant's
possession or control, and to be reasonably available for interviews which the
United States may require. If the cooperation is completed prior to sentencing,
the government agrees to consider whether such cooperation qualifies as
"substantial assistance" in accordance with the policy of the United States
Attorney for the Middle District of Florida, warranting the filing of a motion
at the time of sentencing recommending (1) a downward departure from the
applicable guideline range pursuant to USSG §5K1.1, or (2) the imposition of
a sentence below a statutory minimum, if any, pursuant to 18 U.S.C. §
3553(e), or (3) both. If the cooperation is completed subsequent to sentencing,
the government agrees to consider whether such cooperation qualifies as
"substantial assistance" in accordance with the policy of the United States
Attorney for the Middle District of Florida, warranting the filing of a motion
for a reduction of sentence within one year of the imposition of sentence
pursuant to Fed. R. Crim. P. 35(b). In any case, the defendant understands
that the determination as to whether "substantial assistance" has been
provided or what type of motion related thereto will be filed, if any, rests

solely with the United States Attorney for the Middle District of Florida, and

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the defendant agrees that defendant cannot and will not challenge that
determination, whether by appeal, collateral attack, or otherwise.

10. Use of Information - Section 1B1.8

Pursuant to USSG §1B1.8(a), the United States agrees that no
self-incriminating information which the defendant may provide during the
course of defendant's cooperation and pursuant to this agreement shall be used
in determining the applicable sentencing guideline range, subject to the
restrictions and limitations set forth in USSG §1B1.8(b).

11. Cooperation - Responsibilities of Parties

a. The government will make known to the Court and other
relevant authorities the nature and extent of defendant's cooperation and any
other mitigating circumstances indicative of the defendant's rehabilitative
intent by assuming the fundamental civic duty of reporting crime. However,
the defendant understands that the government can make no representation
that the Court will impose a lesser sentence solely on account of, or in
consideration of, such cooperation.

b. It is understood that should the defendant knowingly
provide incomplete or untruthful testimony, statements, or information
pursuant to this agreement, or should the defendant falsely implicate or

incriminate any person, or should the defendant fail to voluntarily and

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unreservedly disclose and provide full, complete, truthful, and honest
knowledge, information, and cooperation regarding any of the matters noted
herein, the following conditions shall apply:

(1) The defendant may be prosecuted for any perjury or
false declarations, if any, committed while testifying pursuant to this
agreement, or for obstruction of justice.

(2) The United States may prosecute the defendant for
the charges, which are to be dismissed pursuant to this agreement, if any, and
may either seek reinstatement of or refile such charges and prosecute the
defendant thereon in the event such charges have been dismissed pursuant to
this agreement. With regard to such charges, if any, which have been
dismissed, the defendant, being fully aware of the nature of all such charges
now pending in the instant case, and being further aware of defendant's rights,
as to all felony charges pending in such cases (those offenses punishable by
imprisonment for a term of over one year), to not be held to answer to said
felony charges unless on a presentment or indictment of a grand jury, and
further being aware that all such felony charges in the instant case have
heretofore properly been returned by the indictment of a grand jury, does
hereby agree to reinstatement of such charges by recision of any order

dismissing them or, alternatively, does hereby waive, in open court,

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prosecution by indictment and consents that the United States may proceed by
information instead of by indictment with regard to any felony charges which
may be dismissed in the instant case, pursuant to this plea agreement, and the
defendant further agrees to waive the statute of limitations and any speedy
trial claims on such charges.

(3) The United States may prosecute the defendant for
any offenses set forth herein, if any, the prosecution of which in accordance
with this agreement, the United States agrees to forego, and the defendant
agrees to waive the statute of limitations and any speedy trial claims as to any
such offenses.

(4) The government may use against the defendant the
defendant's own admissions and statements and the information and books,
papers, documents, and objects that the defendant has furnished in the course
of the defendant's cooperation with the government.

(5) The defendant will not be permitted to withdraw the
guilty pleas to those counts to which defendant hereby agrees to plead in the
instant case but, in that event, defendant will be entitled to the sentencing
limitations, if any, set forth in this plea agreement, with regard to those counts

to which the defendant has pled; or in the alternative, at the option of the

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United States, the United States may move the Court to declare this entire
plea agreement null and void.

12. Forfeiture of Assets

The defendant agrees to forfeit to the United States immediately
and voluntarily any and all assets and property, or portions thereof, subject to
forfeiture, pursuant to 18 U.S.C. § 982(a)(1), whether in the possession or
control of the United States, the defendant, or defendant's nominees. The
assets to be forfeited specifically include, but are not limited to, the
$1,903,157, in proceeds the defendant obtained and laundered as a result of
the commission of the offense to which the defendant is pleading guilty, as
well as the following assets which were involved in the offense:
a. a 2020 Mercedes-Benz $560, Vehicle Identification
Number W1KUG8DB8LA529322;

b. a 2020 Ford Super Duty F-250 Platinum Edition, Vehicle
Identification Number 1FT7W2BT9LED45745;

Cc. a Rolex watch purchased by the defendant in or about July
2020 from Mayors Jewelers;.

d. Approximately $40,335.00 in U.S. Currency seized from
11248 Mansker Road, Dade City, Florida on or about

October 20, 2020;

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é. Approximately $96,139.32 seized from San Antonio
Federal Credit Union account number 59274-000, held in
the name of Keith W. Nicoletta; and
f. the real property, including all improvements thereon and
appurtenances thereto, located at 11248 and 11304
Mansker Road, Dade City, Florida 33525, being the same
premises conveyed to Keith Nicoletta by virtue of the deed
recorded on August 12, 2019, Instrument Number
201935559, in Pasco County, Official Records, Book 9954,
Pages 508 through 514;
Parcel ID: 09-25-21-0000-05600-0000;
Parcel ID: 09-25-21-0000-05600-0010; and
Parcel ID: 09-25-21-0000-05600-0020.
The defendant agrees to voluntarily surrender the 2020 Mercedes-Benz and
2020 Ford Super Duty F-250 identified above to the Federal Bureau of
Investigation within 30 days of executing this agreement. The defendant
further agrees to take all steps necessary to assist the United States in obtaining
clear title to these vehicles, including surrendering title and/or signing any
other documents necessary to effectuate such transfers.

The defendant acknowledges and agrees that: (1) the defendant

obtained and personally participated in laundering at least $1,903,157 in

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proceeds as a result of the commission of the offense, and (2) as a result of the
acts and omissions of the defendant, these proceeds have otherwise been
transferred to third parties and cannot be located by the United States upon
the exercise of due diligence. Therefore, the defendant agrees that, pursuant to
21 U.S.C. § 853(p), the United States is entitled to forfeit any other property of
the defendant (substitute assets), up to the amount of proceeds the defendant
obtained and laundered, directly or indirectly, as the result of the offense of
conviction. The defendant further consents to, and agrees not to oppose, any
motion for substitute assets filed by the United States up to the amount of
proceeds obtained and laundered from commission of the offense. The
defendant agrees that forfeiture of substitute assets as authorized herein shall
not be deemed an alteration of the defendant's sentence. The net proceeds
from the forfeiture and sale of any specific asset(s) will be credited to and
reduce the amount the United States shall be entitled to forfeit as substitute
assets pursuant to 21 U.S.C. § 853(p).

The defendant agrees that forfeiture of substitute assets as
authorized herein shall not be deemed an alteration of the defendant's
sentence and the United States shall not be limited to the forfeiture of the

substitute assets, if any, specifically listed in this plea agreement.

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The defendant agrees and consents to the forfeiture of these
assets pursuant to any federal criminal, civil, judicial or administrative
forfeiture action. The defendant also agrees to waive all constitutional,
statutory and procedural challenges (including direct appeal, habeas corpus, or
any other means) to any forfeiture carried out in accordance with this Plea
Agreement on any grounds, including that the forfeiture described herein
constitutes an excessive fine, was not properly noticed in the charging
instrument, addressed by the Court at the time of the guilty plea, announced at
sentencing, or incorporated into the judgment.

The defendant admits and agrees that the conduct described in
the Factual Basis below provides a sufficient factual and statutory basis for the
forfeiture of the property sought by the government. Pursuant to Rule
32.2(b)(4), the defendant agrees that the preliminary order of forfeiture will
satisfy the notice requirement and will be final as to the defendant at the time
it is entered. In the event the forfeiture is omitted from the judgment, the
defendant agrees that the forfeiture order may be incorporated into the written
judgment at any time pursuant to Rule 36.

The defendant agrees to take all steps necessary to identify and
locate all property subject to forfeiture (including substitute assets) and to

transfer custody of such property to the United States before the defendant’s

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sentencing. To that end, the defendant agrees to make a full and complete
disclosure of all assets over which defendant exercises control, including all
assets held by nominees, to execute any documents requested by the United
States to obtain from any other parties by lawful means any records of assets
owned by the defendant, and to consent to the release of the defendant’s tax
returns for the previous five years. The defendant agrees to be interviewed by
the government, prior to and after sentencing, regarding such assets and their
connection to criminal conduct. The defendant further agrees to be
polygraphed on the issue of assets, if it is deemed necessary by the United
States. The defendant agrees that Federal Rule of Criminal Procedure 11 and
USSG §1B1.8 will not protect from forfeiture assets disclosed by the defendant
as part of the defendant’s cooperation.

The defendant agrees to take all steps necessary to assist the
government in obtaining clear title to the forfeitable assets before the
defendant’s sentencing. In addition to providing full and complete information
about forfeitable assets, these steps include, but are not limited to, the
surrender of title, the signing of a consent decree of forfeiture, and signing of
any other documents necessary to effectuate such transfers.

The defendant agrees that, in the event the Court determines that

the defendant has breached this section of the Plea Agreement, the defendant

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may be found ineligible for a reduction in the Guidelines calculation for
acceptance of responsibility and substantial assistance, and may be eligible for
an obstruction of justice enhancement.

Forfeiture of the defendant's assets shall not be treated as
satisfaction of any fine, restitution, cost of imprisonment, or any other penalty
the Court may impose upon the defendant in addition to forfeiture.

The defendant agrees that the forfeiture provisions of this plea agreement are
intended to, and will, survive the defendant, notwithstanding the abatement of
any underlying criminal conviction after the execution of this agreement. The
forfeitability of any particular property pursuant to this agreement shall be
determined as if the defendant had survived, and that determination shall be
binding upon defendant’s heirs, successors and assigns until the agreed
forfeiture, including the forfeiture of any substitute assets, is final.

B. Standard Terms and Conditions

1. Restitution, Special Assessment and Fine

The defendant understands and agrees that the Court, in addition
to or in lieu of any other penalty, shall order the defendant to make restitution
to any victim of the offense(s), pursuant to 18 U.S.C. § 3663A, for all offenses
described in 18 U.S.C. § 3663A(c)(1); and the Court may order the defendant

to make restitution to any victim of the offense(s), pursuant to 18 U.S.C. §

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3663, including restitution as to all counts charged, whether or not the
defendant enters a plea of guilty to such counts, and whether or not such
counts are dismissed pursuant to this agreement. The defendant further
understands that compliance with any restitution payment plan imposed by
the Court in no way precludes the United States from simultaneously pursuing
other statutory remedies for collecting restitution (28 U.S.C. § 3003(b)(2)),
including, but not limited to, garnishment and execution, pursuant to the
Mandatory Victims Restitution Act, in order to ensure that the defendant’s
restitution obligation is satisfied.

On each count to which a plea of guilty is entered, the Court
shall impose a special assessment pursuant to 18 U.S.C. § 3013. The special
assessment is due on the date of sentencing. The defendant understands that
this agreement imposes no limitation as to fine.

2. Supervised Release

The defendant understands that the offense(s) to which the
defendant is pleading provide(s) for imposition of a term of supervised release
upon release from imprisonment, and that, if the defendant should violate the
conditions of release, the defendant would be subject to a further term of

imprisonment.

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3. Immigration Consequences of Pleading Guilty

The defendant has been advised and understands that, upon
conviction, a defendant who is not a United States citizen may be removed
from the United States, denied citizenship, and denied admission to the
United States in the future.

4, Sentencing Information

The United States reserves its right and obligation to report to the
Court and the United States Probation Office all information concerning the
background, character, and conduct of the defendant, to provide relevant
factual information, including the totality of the defendant's criminal activities,
if any, not limited to the count(s) to which defendant pleads, to respond to
comments made by the defendant or defendant's counsel, and to correct any
misstatements or inaccuracies. The United States further reserves its right to
make any recommendations it deems appropriate regarding the disposition of
this case, subject to any limitations set forth herein, if any.

5. Financial Disclosures

Pursuant to 18 U.S.C. § 3664(d)(3) and Fed. R. Crim. P.
32(d)(2)(A)(ai), the defendant agrees to complete and submit to the United
States Attorney's Office within 30 days of execution of this agreement an

affidavit reflecting the defendant's financial condition. The defendant promises

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that his financial statement and disclosures will be complete, accurate and
truthful and will include all assets in which he has any interest or over which
the defendant exercises control, directly or indirectly, including those held by
a spouse, dependent, nominee or other third party. The defendant further
agrees to execute any documents requested by the United States needed to
obtain from any third parties any records of assets owned by the defendant,
directly or through a nominee, and, by the execution of this Plea Agreement,
consents to the release of the defendant's tax returns for the previous five
years. The defendant similarly agrees and authorizes the United States
Attorney's Office to provide to, and obtain from, the United States Probation
Office, the financial affidavit, any of the defendant's federal, state, and local
tax returns, bank records and any other financial information concerning the
defendant, for the purpose of making any recommendations to the Court and
for collecting any assessments, fines, restitution, or forfeiture ordered by the
Court. The defendant expressly authorizes the United States Attorney's Office
to obtain current credit reports in order to evaluate the defendant's ability to
satisfy any financial obligation imposed by the Court.

6. Sentencing Recommendations

It is understood by the parties that the Court is neither a party to

nor bound by this agreement. The Court may accept or reject the agreement,

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or defer a decision until it has had an opportunity to consider the presentence
report prepared by the United States Probation Office. The defendant
understands and acknowledges that, although the parties are permitted to
make recommendations and present arguments to the Court, the sentence will
be determined solely by the Court, with the assistance of the United States
Probation Office. Defendant further understands and acknowledges that any
discussions between defendant or defendant's attorney and the attorney or
other agents for the government regarding any recommendations by the
government are not binding on the Court and that, should any
recommendations be rejected, defendant will not be permitted to withdraw
defendant's plea pursuant to this plea agreement. The government expressly
reserves the right to support and defend any decision that the Court may make
with regard to the defendant's sentence, whether or not such decision is
consistent with the government's recommendations contained herein.

7. Defendant's Waiver of Right to Appeal the Sentence

The defendant agrees that this Court has jurisdiction and
authority to impose any sentence up to the statutory maximum and expressly
waives the right to appeal defendant's sentence on any ground, including the
ground that the Court erred in determining the applicable guidelines range

pursuant to the United States Sentencing Guidelines, except (a) the ground

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that the sentence exceeds the defendant's applicable guidelines range as
determined by the Court pursuant to the United States Sentencing Guidelines;
(b) the ground that the sentence exceeds the statutory maximum penalty; or (c)
the ground that the sentence violates the Eighth Amendment to the
Constitution; provided, however, that if the government exercises its right to
appeal the sentence imposed, as authorized by 18 U.S.C. § 3742(b), then the
defendant is released from his waiver and may appeal the sentence as
authorized by 18 U.S.C. § 3742(a).

8. Middle District of Florida Agreement

It is further understood that this agreement is limited to the
Office of the United States Attorney for the Middle District of Florida and
cannot bind other federal, state, or local prosecuting authorities, although this
office will bring defendant's cooperation, if any, to the attention of other
prosecuting officers or others, if requested.

9. Filing of Agreement

This agreement shall be presented to the Court, in open court or

in camera, in whole or in part, upon a showing of good cause, and filed in this

cause, at the time of defendant's entry of a plea of guilty pursuant hereto.

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10. Voluntariness

The defendant acknowledges that defendant is entering into this
agreement and is pleading guilty freely and voluntarily without reliance upon
any discussions between the attorney for the government and the defendant
and defendant's attorney and without promise of benefit of any kind (other
than the concessions contained herein), and without threats, force,
intimidation, or coercion of any kind. The defendant further acknowledges
defendant's understanding of the nature of the offense or offenses to which
defendant is pleading guilty and the elements thereof, including the penalties
provided by law, and defendant's complete satisfaction with the representation
and advice received from defendant's undersigned counsel (if any). The
defendant also understands that defendant has the right to plead not guilty or
to persist in that plea if it has already been made, and that defendant has the
right to be tried by a jury with the assistance of counsel, the right to confront
and cross-examine the witnesses against defendant, the right against
compulsory self-incrimination, and the right to compulsory process for the
attendance of witnesses to testify in defendant's defense; but, by pleading
guilty, defendant waives or gives up those rights and there will be no trial. The
defendant further understands that if defendant pleads guilty, the Court may

ask defendant questions about the offense or offenses to which defendant

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pleaded, and if defendant answers those questions under oath, on the record,
and in the presence of counsel (if any), defendant's answers may later be used
against defendant in a prosecution for perjury or false statement. The
defendant also understands that defendant will be adjudicated guilty of the
offenses to which defendant has pleaded and, if any of such offenses are
felonies, may thereby be deprived of certain rights, such as the right to vote, to
hold public office, to serve on a jury, or to have possession of firearms.

11. Factual Basis

Defendant is pleading guilty because defendant is in fact guilty.
The defendant certifies that defendant does hereby admit that the facts set
forth below are true, and were this case to go to trial, the United States would
be able to prove those specific facts and others beyond a reasonable doubt.
FACTS

KEITH NICOLETTA owns a small salvage business known as West
Coast Cores, LLC (“WCC”) in Dade City, Florida. Apart from some
independent contractors, WCC has no employees. Despite this, on or about
June 2, 2020, NICOLETTA and his conspirators used WCC to fraudulently
secure over $1.9 million in Paycheck Protection Program (“PPP”) funds.
WCC’s PPP loan application, submitted using interstate wire transmission,

falsely claimed that it had 69 employees with an Average Monthly Payroll

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demand of $761 ,263—or, annualized, $9,135,156. That was a lie. WCC had
reported no wages for any employee for either 2019 or 2020. WCC, as
NICOLETTA knew, simply had no employees then.

With no employees to pay, NICOLETTA and his conspirators
laundered and then misused the PPP funds in an effort to conceal and disguise
the nature, location and source of the funds. For NICOLETTA, this meant,
among other things, using the funds to purchase a 2020 Mercedes-Benz $560
(valued at over $106,000), a 2020 Ford Super Duty F-250 Platinum Edition
(valued at over $75,000), and a Rolex watch; moving the funds through and
into a number of bank accounts owned or controlled by NICOLETTA or
others, including account number 59274-000, held at San Antonio Federal
Credit Union; and using the funds to make mortgage payments on his
residence located at 11248 Mansker Road, Dade City, Florida, and towards
the construction of a built-in pool for this residence. Additionally,
NICOLETTA withdrew over $407,000 in cash, including approximately
$40,335.00 which was seized from his residence on or about October 20, 2020.
NICOLETTA also delivered additional cash to the conspirators and

transferred at least $537,000 by wire to them through business fronts.

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Background Regarding the PPP

In March 2020, the Coronavirus Aid, Relief, and Economic Security
Act, or the “CARES Act,” was enacted to provide immediate assistance to
individuals, families, and organizations affected by the COVID-19 emergency.
Among its various provisions, the CARES Act authorized the Small Business
Administration (“SBA”) to guarantee loans under the PPP, and the full
principal amount of the loans could qualify for forgiveness.

Borrowers were required to use PPP loan proceeds for enumerated
purposes, including payroll costs, rent and utilities, and mortgage interest
payments. Knowing misuse of PPP funds could subject the borrower to
additional liability, such as charges for fraud.

Under the PPP, the maximum loan amount was the lesser of $10
million or an amount calculated using a payroll-based formula. The payroll-
based formula looked at the borrower’s aggregate payroll costs from the
preceding twelve months for its employees. Once an average monthly payroll
cost is established, the borrower multiplies that amount by 2.5 to arrive at the
total maximum PPP loan amount.

The PPP Application Process: the SBA Form 2483
To apply for a PPP loan, potential borrowers would submit an SBA

Form 2483 with supporting payroll documentation to a financial institution

Defendant’s Initials
Case 8:21-cr-O0006-MSS-AAS Document 27 Filed 01/13/21 Page 24 of 29 PagelD 83

that administers the loan and serves as custodian of the funds. The supporting
payroll documentation could include—and, here, did include—payroll tax
filings submitted to the Internal Revenue Service (“IRS”) (hereinafter, the
“IRS Form 941”).

On the SBA Form 2483, an authorized representative must also make
several certifications about his business operations and related information.
Those certifications included, among other things, that the PPP funds would
be used to retain workers and to maintain payroll or pay other qualifying
expenses. The authorized representative must further certify that, should he
knowingly use the PPP funds for unauthorized purposes, the United States
could hold him legally liable, including for charges of fraud. Finally, the
following warning must be certified:

I understand that knowingly making a false statement to obtain a
guaranteed loan from SBA is punishable under the law, including under
18 U.S.C. §§ 1001 and 3571 by imprisonment of not more than five
years and/or a fine of up to $250,000; under 15 U.S.C. § 645 by
imprisonment of not more than two years and/or a fine of not more
than $5,000; and, if submitted to a federally insured institution, under
18 U.S.C. § 1014 by imprisonment of not more than thirty years and/or
a fine of not more than $1,000,000.

WCC's False and Fraudulent PPP Loan Application
On or about May 30, 2020, the conspirators electronically submitted via

interstate wire transmission a false and fraudulent PPP loan application (ie.,

the SBA Form 2483) for WCC. The SBA Form 2483 falsely claimed that

an 24
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Case 8:21-cr-O0O006-MSS-AAS Document 27 Filed 01/13/21 Page 25 of 29 PagelD 84

WCC had 69 employees with a monthly payroll demand of approximately
$761,263. Applying the payroll-based calculator, the conspirators requested
approximately $1,903,157 in PPP funds—funds, they certified, that would
purportedly cover payroll to retain its 69 employees. But WCC did not have
69 employees; it had none.

Without actual employees, the conspirators fabricated payroll tax
records for WCC to justify the loan amount. Specifically, they created four
bogus IRS Forms 941 for WCC for Q1—Q4 of 2019. These forms falsely
claimed that WCC had reported over $9 million in wages to the IRS. But the
IRS had no record of these forms.

Surveillance of WCC’s stated business address—NICOLETTA’s
home—showed no salvage operation, let alone one requiring 69 employees.
And records from the state of Florida showed no reported wages for WCC for
2019 or 2020. Instead, as NICOLETTA voluntarily admitted in a post-
Miranda interview, WCC had no employees.

The false and fraudulent SBA Form 2483 also listed NICOLETTA as
WCC’s “authorized representative.” As such, his electronic initials “K.N.”
were entered beside all required certifications, including that “the information
provided in this application and the information provided in all supporting

documents and forms [were] true and accurate in all material respects.” But

an 25
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Case 8:21-cr-O0006-MSS-AAS Document 27 Filed 01/13/21 Page 26 of 29 PagelD 85

NICOLETTA then and there knew that material information on WCC’s SBA
Form 2483 was false.
Transfers and Improper Use of PPP Funds

On or about June 2, 2020, C.B., a bank located in Utah, disbursed
$1,903,157 in PPP funds to WCC’s bank account (-3127) at Credit Union-1 in
the Middle District of Florida. C.B. was a financial institution, as defined in
18 U.S.C. § 20, insured by the Federal Deposit Insurance Company; it was
also the entity utilized to administer the loan and the entity with custody and
control of the funds.

Prior to the PPP deposit, the balance of WCC’s account (-3127) was
only $11.74. Almost immediately thereafter, NICOLETTA engaged in a series
of intra-bank transfers between his personal and business banks accounts at
Credit Union-1. First, on June 2, 2020 (ie., the day the PPP funds were
disbursed), NICOLETTA transferred $1,000,000 from WCC’s account (-3127)
to his personal savings account (-1379). After yet additional transfers, on or
about June 5, 2020, NICOLETTA moved approximately $1,846,000 into his
personal checking account (-1405) using a cashier’s check comprised almost
exclusively of PPP funds.

In June 2020, NICOLETTA moved the PPP funds to a different credit

union (“Credit Union-2”). On June 8, 2020, NICOLETTA transferred

26
Defendant’s Initials
Case 8:21-cr-O0006-MSS-AAS Document 27 Filed 01/13/21 Page 27 of 29 PagelD 86

$1,741,000 from Credit Union-1 to his personal account (-9858) at Credit
Union-2 using another cashier’s check. NICOLETTA then opened at least
three new bank accounts for new business entities. None of these entities were
mentioned on WCC’s SBA Form 2483. NICOLETTA again repeatedly
moved the PPP funds in another series of intra-bank transfers at Credit Union-
2. In material part, these transfers were designed and implemented to conceal
and disguise the nature, location, source, ownership, and control of the
fraudulently-obtained loan proceeds. He also, as detailed later, used the PPP
funds extensively for his own personal enjoyment and benefit. These
dispositions fell well outside of the SBA’s enumerated, authorized uses for
PPP funds.

On or about August 19, 2020, NICOLETTA moved the remaining PPP
funds (i.e., approximately $411,000) to a third credit union (“Credit Union-
3”). Examples of NICOLETTA’s unauthorized use of the PPP funds are
noted below:

- Approximately $55,000 towards the purchase of a 2020

Mercedes-Benz S560 valued at over $106,000 on or about August
10, 2020;
- Approximately $30,000 towards the purchase of a 2020 Ford

Super Duty F-250 Platinum Edition valued at over $75,000 on or
about August 24, 2020;

- Approximately $11,250 to purchase a Rolex on or about July 7,
2020;

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Case 8:21-cr-O0006-MSS-AAS Document 27 Filed 01/13/21 Page 28 of 29 PagelD 87

- At least $26,000 was paid to satisfy NICOLETTA’s home
mortgage arrearages satisfied on or about July 6, 2020, plus at
least three subsequent monthly home mortgage payments of over

$6,600; and

- Over $63,000 paid to install a pool at NICOLETTA’s home.

In addition, NICOLETTA transferred or even personally delivered PPP
funds to his conspirators. Specifically, in or about June 2020, NICOLETTA
initiated two wires totaling approximately $537,000 to a purported property
management company controlled by a known conspirator. He also delivered a
large sum of cash to conspirator R.R. on at least one occasion.

12. Entire Agreement

This plea agreement constitutes the entire agreement between the
government and the defendant with respect to the aforementioned guilty plea
and no other promises, agreements, or representations exist or have been

made to the defendant or defendant's attorney with regard to such guilty plea.

pi ®
Case 8:21-cr-O0006-MSS-AAS Document 27 Filed 01/13/21 Page 29 of 29 PagelD 88

13. Certification
The defendant and defendant’s counsel certify that this plea
agreement has been read in its entirety by (or has been read to) the defendant
and that defendant fully understands its terms.
DATED this Iota, of January 2021.

MARIA CHAPA LOPEZ
United States Attorney

gten A. Fiore
ae Assistant United States Attorney
Bjorn B . i ay \G. Trezevant
Attorney for Defendant Assistant United States Attorney

Chief, Economic Crimes Section

29


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