A Los Angeles man was arrested and charged with COVID-19 relief fraud after he illegally obtained PPP loans and then spent some of the proceeds on risky stock market bets and gambling in Las Vegas casinos, according to the Justice Department.
Andrew Marnell, 40, was charged with one count of bank fraud on Thursday, according to a criminal complaint.
Authorities said Marnell could face up to 30 years in prison on the bank fraud charge, CBS News reports.
The complaint alleges that Marnell obtained approximately $8.5 million in PPP loans through fraudulent loan applications. The applications made false statements about the companies’ business expenses in order to obtain the loans, according to the complaint.
In addition to making fake applications, the complaint states Marnell also submitted false federal tax filings and employee payroll records. He also used aliases when filing some of the loan applications.
Marnell then sent some of the loan funds to his brokerage account where he made risky stock market bets, the complaint states. He gambled hundreds of thousands of dollars at the Bellagio Hotel and Casino and other Las Vegas casinos as recently as last weekend, according to the complaint.
The PPP loans were part of the CARES Act to help small businesses suffering a financial burden amid the coronavirus pandemic. The PPP loans are supposed to be used for payroll assistance and other expenses like rent.
Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division and U.S. Attorney Nicola T. Hanna of the Central District of California announced the arrest.
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