Acting United States Attorney Karin Hoppmann announces the filing of a criminal complaint charging Julio Lugo (44) and Rosenide Venant (37), both of Davenport, with conspiracy and making false statements to a financial institution. Lugo has also been charged with an illegal monetary transaction relating to the illegal use of coronavirus relief funds to pay off a note on a luxury car purchased during the conspiracy.
If convicted, Lugo faces a maximum penalty of 45 years in federal prison; Venant faces up to 35 years’ imprisonment.
According to the complaint, beginning in or about March 2020, Lugo and Venant conspired to defraud the Small Business Administration (“SBA”) out of millions of dollars in coronavirus relief funds. Lugo and Venant used their home IP-address to submit at least 70 false and fraudulent loan applications seeking funds from the Paycheck Protection Program (“PPP”) and Economic Injury Disaster Loan (“EIDL”) program.
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The fraudulent loan applications requested more than $5.8 million, including for shell companies established by Lugo, Venant, and their relatives. The conspirators also secured coronavirus relief funds for a defunct tax-preparation company that Lugo had previously used to perpetrate a tax fraud in or around 2015. Once the emergency loans were secured, the conspirators misused the PPP and EIDL funds by paying off a luxury vehicle, spending more than $62,000 at casinos, and for other personal purposes.
Additionally, the conspirators withdrew at least $320,000 in cash. Lugo publicized the misuse of the SBA funds in a Facebook video featuring a hotel room littered with $100 bills and at least $5,000 in merchandise from Louis Vuitton.
The Coronavirus Aid, Relief, and Economic Security (“CARES”) Act is a federal law enacted March 2020. It is designed to provide emergency financial assistance to millions of Americans who are suffering the economic effects resulting from the COVID-19 pandemic.
One source of relief provided by the CARES Act is the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses through the PPP. In April 2020, Congress authorized over $300 billion in additional PPP funding. In response to COVID-19, small business owners, including agricultural businesses, and nonprofit organizations in all U.S. states, Washington D.C., and territories were also authorized to apply for loans and grants through the COVID-19 EIDL program.
A complaint is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service – Criminal Investigation, Tampa Field Office. It will be prosecuted by Assistant United States Attorney Kristen A. Fiore.