United States v. Donald Finley: Government Letter in Connection with Sentencing (E.D.N.Y., March 26, 2024)

Summary

A letter from the United States Attorney's Office for the Eastern District of New York, dated March 26, 2024 and addressed to The Honorable Joan M. Azrack, on sentencing in United States v. Donald Finley, Criminal Docket No. 23-181 (JMA), Document 21. The government states that a sentence of 41 to 51 months' incarceration would be sufficient, but not greater than necessary, and agrees with the defendant's objection to the PSR's advisory range of 51 to 63 months. It states that Finley submitted 20 false PPP loan applications to steal more than $3.2 million. It states that Finley was charged by information on May 25, 2023 with disaster relief fraud and wire fraud and pled guilty to both counts the same day.

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“United States v. Donald Finley: Government Letter in Connection with Sentencing (E.D.N.Y., March 26, 2024).” Original at storage.courtlistener.com. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/sentencing-memorandum-no-2-23-cr-00181-dkt-21-e-d-n-y-ee52eddab4/, SHA-256 c43e67f8154366e0f65479743365f2a5ad5f6104ee99bf28fd1f0329e2934e90.

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Case 2:23-cr-00181-JMA-ARL Document 21 Filed 03/26/24 Page 1 of 8 PageID #: 278

U.S. Department of Justice

United States Attorney
Eastern District of New York
MEM 610 Federal Plaza
F. #2021R00393 Central Islip, New York 11722

March 26, 2024

By ECF and Courtesy Copy by Interoffice Mail

The Honorable Joan M. Azrack
United States District Judge
United States District Court
Eastern District of New York
920 Federal Plaza
Central Islip, New York 11722

Re: United States v. Donald Finley
Criminal Docket No. 23-181 (JMA)

Dear Judge Azrack:

The government respectfully submits this letter in connection with the sentencing
of defendant Donald Finley, in the above-referenced matter. For the reasons that follow, the
government submits that a sentence of 41 to 51 months’ incarceration, would be sufficient, but not
greater than necessary, to achieve the goals of sentencing in this case.

I. Factual Background

In March 2020, the United States (and indeed, the entire world) was confronted
with a public health crisis of unprecedented proportions amid the onset of the COVID-19
pandemic. 1 Recognizing that countless American businesses had been shuddered as a result of the
virus’ rapid spread, on March 29, 2020, Congress enacted the Coronavirus Aid, Relief, and
Economic Security Act (the “CARES Act”) to provide emergency financial assistance to distressed
small businesses. See United States Probation Department (“Probation”) Presentence
Investigation Report (“PSR”), prepared September 28, 2023, at ¶¶ 6-8.

As part of the CARES Act, funds were allocated for the issuance of forgivable loans
to small businesses for job retention and payroll-related expenses via the Paycheck Protection
Program (“PPP program”). Id. The PPP program allowed qualifying small businesses to receive
unsecured loans to address business expenses such as payroll, rent, mortgage-related payments

1 According to the website of the World Health Organization, the COVID-19
pandemic has claimed 6.9 million lives worldwide and 1.1 million lives in the United States. See
https://data.who.int/dashboards/covid19/deaths?n=c (last visited March 8, 2024).
Case 2:23-cr-00181-JMA-ARL Document 21 Filed 03/26/24 Page 2 of 8 PageID #: 279

and utilities. PSR at ¶ 6. If the PPP funds were used for their intended purposes and in accordance
with the program’s terms, the loans would be forgiven. Id. The PPP program was overseen by
the Small Business Administration (“SBA”) and various financial institutions received and
processed the PPP loan applications, which, if approved, would then be funded directly by the
lenders and backed by the federal government. Id. The amount of the loans was determined by a
formula which required applicants to truthfully report information such as the business’s number
of employees and payroll costs, and to provide corroborating documentation. Id. In addition to
the PPP program, the CARES Act also provided funding for the Economic Injury Disaster Loan
Program (“EIDL program”), which was an SBA program designed to provide up to $2 million in
loans to eligible small businesses that experienced financial disruption due to the COVID-19
pandemic. Id. Like the PPP program, the EIDL program required applicants to use an online
portal to truthfully report to the SBA information related to a business’ operations for the preceding
twelve-month period. Id. Also like the PPP program, EIDL program funds could only be used for
limited, business-related purposes. Id.

In this unprecedented public health crisis, Finley, unlike so many other Americans
who were also suffering, sought to take advantage of the situation; amid massive public suffering,
he saw an opportunity to steal money designed to ease the suffering of those who followed the
rules for the common good. Beginning in March of 2020, and continuing through March 2021,
Finley utilized his companies, some of which were inactive or created just prior to or during the
pandemic (the “Companies”), to submit 20 false PPP loan applications—each supported by
fraudulent and falsified tax returns—to steal more than $3.2 million in disaster relief funds. PSR
at ¶¶ 9-10. In a number of these filings, Finley utilized his wife or daughters as nominees of the
applicable company. PSR at ¶ 9.

Specifically, Finley submitted 29 online applications for the Companies (20 PPP
loans and nine EIDL loans) —applications that contained false information, bogus financial data,
and fabricated supporting documentation, all of which was designed to fraudulently induce the
SBA and the lenders administering the PPP and EIDL programs to approve all 29 applications
totaling nearly $3.2 million. PSR at ¶ 10. Once the loans were approved, Finley sent the funds
through more than 30 bank accounts to prevent tracing of the proceeds, with substantial portions
of the stolen funds being utilized to purchase real property in Nantucket, Massachusetts on
February 5, 2021 (the “Nantucket Property.”) Information ¶ 10, Doc. No. 1. In addition, at the
time Finely was requesting and receiving CARES Act funds he paid more than $15,0000 to two
separate private New York yacht clubs.

II. Procedural Background

On May 25, 2023, Finley was arrested and charged by information with disaster
relief fraud and wire fraud, in violation of §§ 18 U.S.C. § 1040(a)(2) and 1343, respectively. See
United States v. Finley, 23-CR-181, ECF Doc. No. 1. Finley pled guilty to both counts the same
day.

III. Sentencing Guidelines

On September 28, 2023, Probation disclosed the PSR, in which it calculated
Finley’s advisory Guidelines range to be 51 to 63 months’ imprisonment. PSR at ¶ 73. At the

2
Case 2:23-cr-00181-JMA-ARL Document 21 Filed 03/26/24 Page 3 of 8 PageID #: 280

time Probation calculated the Guidelines, they were accurate. However, the defendant has
objected to the calculation based on recent amendments to the Guidelines. Def. Sent’g Memo 27,
Doc. No. 19. The government agrees with the defendant’s objection. More specifically, the
government agrees the defendant is a criminal history category I, and that the following Guidelines
analysis is now applicable to the defendant:

Base Offense Level (U.S.S.G. § 2B1.1(a)(1)) 7

Plus: Loss in excess of $1.5 Million, but not Greater Than $3.5 million
(U.S.S.G. § 2B1.1(b)(1)(I)) +16

Plus: Disaster Relief Fraud (U.S.S.G. § 2B1.1(b)(12)) +2

Plus: More than $1 Million Derived from a Financial Institution
(U.S.S.G. § 2B1.1(b)(17)(A)) +2

Less: No Prior Criminal History Points (U.S.S.G. § 4C1.1) -2

Less: Acceptance of Responsibility (U.S.S.G. §§ 3E1.1(a) and (b)) -3

Total: 22 2

Based upon a total offense level of 22 and Criminal History Category I, Finley’s advisory
Guidelines range is 41 to 51 months’ imprisonment. We would respectfully ask the Court to adopt
this analysis and associated Guidelines range.

IV. Argument

As set forth herein, a fair application of the § 3553(a) factors compels the
conclusion that a Guidelines sentence of 41 to 51 months’ imprisonment is sufficient, but not
greater than necessary, to achieve the goals of sentencing in this case.

A. The Advisory Range and Kinds of Sentences Available
(18 U.S.C. § 3553(a)(3), (a)(4)(A))

In United States v. Booker, 543 U.S. 220 (2005), the Supreme Court held that the
Guidelines were no longer mandatory but should be considered in conjunction with the factors
outlined in § 3553(a). Thereafter, the Supreme Court confirmed that § 3553(a) requires a
sentencing court to give respectful consideration to the Guidelines, but Booker allows the court to
“tailor the sentence in light of other statutory concerns[.]” Kimbrough v. United States, 552 U.S.
85, 101 (2007) (citing Booker, 543 U.S. at 245-46; Gall v. United States, 552 U.S. 38, 46-49
(2007)). However, the Supreme Court explained that even though the Guidelines are now
advisory, “district courts must treat the Guidelines as the ‘starting point and the initial benchmark’”

2
The PSR correctly conducts a unit analysis for both counts; however, this
analysis does not affect the defendant’s Guidelines range.

3
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when determining a defendant’s sentence. Kimbrough, 552 U.S. at 108 (citing Gall, 552 U.S. at
49; Rita v. United States, 551 U.S. 347-50 (2007)).

With the Guidelines as the “starting point and the initial benchmark,” the Court
should next consider the factors set forth by Congress in § 3553(a). Id. That statute provides that
a Court should consider a number of factors when determining a defendant’s sentence, including:

(1) the nature and circumstances of the offense and the history and characteristics
of the defendant; and

(2) the need for the sentence imposed: (A) to reflect the seriousness of the offense,
to promote respect for the law, and to provide just punishment for the offense;
(B) to afford adequate deterrence to criminal conduct; (C) to protect the public
from further crimes of the defendant; and (D) to provide the defendant with
needed educational or vocational training, medical care, or other correctional
treatment in the most effective manner[.]

18 U.S.C. §§ 3553(a)(1) and (2).

Here, the Guidelines certainly counsel for a substantial prison term. Indeed, the
Guidelines call for a sentence of 41 to 51 months’ imprisonment.

B. The Nature and Circumstances of the Offense
(18 U.S.C. § 3553(a)(1))

The nature and circumstances of Finley’s criminal conduct call for a stringent
sentence. This was not a crime of desperation, but a crime of greed, in which Finley defrauded
the SBA and financial institutions of approximately $3.2 million. This fact alone makes a
Guidelines sentence appropriate.

Initially, the Guidelines accurately reflect the seriousness of the defendant’s crime.
See 18 U.S.C. § 3553(a)(2)(A). In a once-in-a-generation public health crisis, the defendant saw
an opportunity to manipulate a government welfare program for his own self-enrichment. In that
regard, it bears emphasizing the deliberate and repeated steps the defendant took to effectuate his
fraud—taking time away from his personal and professional life amid the COVID-19 pandemic to
create and submit 29 separate fraudulent loan applications, on behalf of twenty different entities,
over the course of several months. Notably, accompanying each PPP application were fake tax
documents purporting to show that a particular corporate entity was paying wages in hundreds of
thousands of dollars when, in actuality, various companies were inactive or created just prior to or
during the pandemic, demonstrating the defendant had no intention of using any loan proceeds to
support those businesses or their fictious employees. In fact, in 2019 Finley only reported wages
for his employees of $69,000 3 for all his legitimate companies – at the very same time Finley

3
In 2019, prior to the pandemic, Finley only reported $69,000 in employee
payroll for six employees. Given this occurred before the pandemic, this was arguably a
staff of full capacity. Finley claims that during the pandemic he poured “the relief funds into
his suffering businesses. . ..” Def. Sent’g Memo 25. Conspicuously, the $1.2 million in

4
Case 2:23-cr-00181-JMA-ARL Document 21 Filed 03/26/24 Page 5 of 8 PageID #: 282

reported paying employee wages of $4,848,401 while filing for his fraudulent CARES Act funds.
That the defendant began this venture just four days after the enactment of the CARES Act, when
disaster relief funds first became available, speaks to the truly depraved nature of the offense
conduct.
Most offensively, this scheme was specifically designed to exploit an international
public health emergency to in-part line Finley’s pockets. The federal government mobilized to
meet the momentous challenges the pandemic presented, working collaboratively with private
financial institutions to provide disaster relief funds as quickly as possible to distressed small
business owners. It was against that backdrop that Finley saw an opportunity; while Americans
were dying by the thousands and unemployment was steadily rising,4 Finley went to extraordinary
lengths to submit 29 loan applications in the names of fake companies, fabricate tax documents,
and carefully move money through a web of accounts.

The COVID-19 pandemic was unprecedented, and the defendant’s callous choice
to secure the Nantucket Property during a time of crisis is particularly egregious. Similarly, the
scope of his fraud in light of the nature of the emergency ongoing in the United States at the time
is staggering. The nature and circumstances of this defendant’s crimes clearly supports the
imposition of a Guidelines sentence.

The Court should reject the defendant’s current contention that the criminal scheme
was somehow primarily designed to benefit Finley’s employees and that Finley “submitted more
than one loan application for the same business only after considerable time had elapsed with no
information on the status of his original loan . . ..” See, Def. Sent’g Memo 13, Fn 3. This is an
attempt by the defendant to minimize his illegal conduct – conduct that he has acknowledged was
criminal – not a mere oversight or mistake. This after-the-fact justification is wholly inconsistent
with his use of government funds to purchase the Nantucket Property. The government’s
investigation has directly traced CARES Act monies to the purchase of the Nantucket Property.
The defendant attempts to cleanse the purchase of the Nantucket property by claiming, “Finley’s
mistake was that he deposited some of the pandemic funds he received into business accounts he
was also using to fund the [Nantucket Property] re-purchase. Critically, however, he had funds in

legitimate CARES Act funds he received is more than 17 times his payroll reported pre-
pandemic. Additionally, it is more than 46 times the $3.2 million dollars stolen by Finley.
Furthermore, in 2020 Finley reported total payroll of $131,055. Of the $131,055 in payroll,
$86,795 were payable to Finley, his wife or his children – not to his employees. This casts
substantial doubt on the defendant’s claims regarding his intended use of the CARES Act
funds.
4 See United States Bureau of Labor Statistics,
https://www.bls.gov/opub/mlr/2022/article/us-labor-market-shows-improvement-in-2021-but-
the-covid-19-pandemic-continues-to-weigh-on-the-
economy.htm#:~:text=The%20recession%20induced%20by%20the,to%20leave%20the%20labo
r%20force (last visited March 8, 2024).

5
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C. History and Characteristics of the Defendant
(18 U.S.C. § 3553(a)(1))

The government agrees that the defendant has no prior criminal convictions.

D. Seriousness of the Offense
(18 U.S.C. § 3553(a)(2)(A))

The seriousness of Finley’s conduct cannot be overstated. He stole millions of
dollars that were intended to relieve an unimaginable emergency that impacted the entire country.
Far from caring about others in a time of need, Finley lied and defrauded financial institutions to
steal millions of relief dollars. The theft of million dollars that was earmarked for disaster relief
certainly supports the imposition of a term of imprisonment of 41 to 51 months.

E. Promote Respect for the Law
(18 U.S.C. § 3553(a)(2)(A))

As with the seriousness of the offense, the need to promote respect for the laws
against fraud and the theft of disaster relief funds call for a substantial sentence to ensure that in
the next national emergency, would-be fraudsters like Finley do not think they can steal to benefit
themselves at the expense of people in real need. The facts of this case require a stringent custodial
term to promote the respect for such laws, and a 41 to 51 month prison term is warranted.

F. Just Punishment
(18 U.S.C. § 3553(a)(2)(B))

In this case, a 41 to 51 month prison term is a just punishment. Indeed, such a
sentence is mandated by the totality of the circumstances. As explained above, Finley saw in the
government’s response to the COVID-19 pandemic an opportunity to enrich himself.

G. Deterrence
(18 U.S.C. § 3553(a)(2)(B))

In this case, general deterrence is vitally important. General deterrence will be
served by a Guidelines sentence, as people must understand that if they elect to steal and line their
pockets with funds designed to bring aid to the public during times of crisis, they will be dealt with
harshly.

7
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V. Conclusion

As set forth above, the § 3553(a) factors call for a Guidelines prison term. The
government respectfully submits that a sentence of 41 to 51 months’ imprisonment is a sentence
that is sufficient, but not greater than necessary, to achieve the goals of sentencing in this case.

Respectfully submitted,

BREON PEACE
United States Attorney

By: /s/
Mark E. Misorek
Assistant U.S. Attorney
(631) 715-7874

cc: Counsel of Record (by ECF and email)
Clerk of the Court (JMA) (by ECF)

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