U.S. Department of Labor OIG, California Man Pleads Guilty to Federal Cares Act Fraud (USAO ED-LA 07/12/2024) (2024-07-18)

Summary

A July 12, 2024 press release from the U.S. Attorney's Office for the Eastern District of Louisiana announcing that Nipun Desai, formerly of Hammond, La., pleaded guilty on July 10, 2024 before U.S. District Judge Wendy B. Vitter to making false statements related to the CARES Act. According to court records, on or about January 25, 2021, Desai made false statements to an approved lender to obtain an SBA backed PPP loan of $146,947.50 for the Fairbridge Hotel in Metairie, LA, which was permanently closed and had no employees or payroll. Sentencing is set for October 8, 2024. The release states the investigation was conducted by the U.S. Department of Veterans Affairs - Office of Inspector General as part of the Pandemic Response Accountability Committee (PRAC) Task Force.

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Full text

PRESS RELEASE



California Man Pleads Guilty to
Federal Cares Act Fraud
Friday, July 12, 2024


For Immediate Release
U.S. Attorney's Office, Eastern District of Louisiana
shane.jones@usdoj.gov

NEW ORLEANS – U.S. Attorney Duane A. Evans announced that NIPUN
DESAI (“DESAI”), formerly of Hammond, La., but now a California resident, age 55,
pleaded guilty on July 10, 2024 before U.S. District Judge Wendy B. Vitter to making
false statements related to the Coronavirus Aid, Relief, and Economic Security Act
(CARES Act).

On March 27, 2020, the President of the United States signed into law the CARES Act,
which provided emergency assistance, administered by the United States Small Business
Administration (SBA), to small business owners affected by the Coronavirus (COVID-19)
pandemic. The two primary sources of funding for small businesses were the Paycheck
Protection Program (PPP) and the Economic Injury Disaster Loans (EIDL) program.

According to court records, on or about January 25, 2021, DESAI made false statements
to an approved lender in order to obtain an SBA backed PPP loan in the amount of
$146,947.50 for the Fairbridge Hotel in Metairie, LA. At the time of the loan
application, DESAI’s hotel was permanently closed and had no employees or payroll.

DESAI is to be sentenced on October 8, 2024. At that time, he faces up to five years in
prison, a fine of up to $250,000, up to three years of supervised release, and the
payment of a $100 mandatory special assessment fee.

For more information on the Department of Justice’s response to the pandemic, please
visit https://www.justice.gov/coronavirus. Anyone with information about allegations of
attempted fraud involving COVID-19 can report it by calling the Department of Justice’s
National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF
Web Complaint Form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-
form.
As part of the Pandemic Response Accountability Committee (PRAC) Task Force, this
investigation was conducted by U.S. Department of Veterans Affairs - Office of Inspector
General. The PRAC was established to promote transparency and facilitate coordinated
oversight of the federal government’s COVID-19 pandemic response. The PRAC’s 20
member Inspectors General identify major risks that cross program and agency
boundaries to detect fraud, waste, abuse, and mismanagement in the more than $5
trillion in COVID-19 spending, including spending via the Paycheck Protection Program
(PPP), and Economic Injury Disaster Loan (EIDL) program. This case was also supported
by the PRAC’s Pandemic Analytics Center of Excellence, which applies the latest
advances in analytic and forensic technologies to help OIGs and law enforcement
pursue data-driven pandemic relief fraud investigations.

U.S. Attorney Evans praised the work of the U.S. Department of Veterans Affairs - Office
of Inspector General, the Department of Labor – Office of Inspector General, and the
U.S. Bankruptcy Trustee’s Office (Region 5) in investigating this matter. Assistant U.S.
Attorney Edward J. Rivera of the Financial Crimes Unit is in charge of the prosecution.

Updated July 12, 2024

Topics
CORONAVIRUS

FINANCIAL FRAUD
Component
USAO - Louisiana, Eastern


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