North Carolina father and son sent to prison for embezzling $1.7 million COVID relief
A Waxhaw, North Carolina man falsified information on PPP loan applications to obtain $1.7 million in Covid-19 relief.
David Spunt reports on estimated $100 billion in fraud cases
A North Carolina man and his son were sentenced to prison this week for submitting fraudulent loan applications seeking $1.7 million in COVID-19 relief.
Izzat Freitekh, 57, of Waxhaw, North Carolina and his son, Tarik Freitekh, 35, of Glendale, California, submitted applications for forgivable Paycheck Protection Program, or PPP, loans, which were guaranteed by the Small Business Administration under the Coronavirus Aid, Relief, and Economic Security, or CARES, Act.
The La Shish Kabob restaurant in Charlotte, North Carolina. The owner, Izzat Freitekh, 55, and his son, Tarik Freitekh, 33, were convicted Thursday of fraud and bank charges related to $1.7 million in COVID-19 relief funds. (Google Maps / Google Maps)
Izzat was sentenced to four years in prison and Tarik was sentenced to just over 7 years in prison, according to a press release from the U.S. Department of Justice.
SBA DOLED OUT $684M IN PPP LOANS TO ‘POTENTIALLY INELIGIBLE’ NONPROFITS
The DOJ said the Freitekhs secured $1.7 million by submitting fraudulent PPP loan applications for companies owned by the senior, Izzat. The companies included La Shish Kabob, La Shish Kabob Catering, Green Apple Catering, and Aroma Packaging.
The Freitekhs, according to the DOJ, falsified information when it came to the number of employees and payroll expenses.
PPP loan concept (istock / iStock)
Once the money was acquired, the DOJ added, the Freitekhs made several unlawful monetary transactions, which included making payments to family members in the amount of $30,000.
NORTH CAROLINA COUPLE SENTENCED FOR COVID RELIEF FRAUD, EMBEZZLING MORE THAN $200K FROM BOOSTER CLUB
The U.S. Postal Inspection Service, or USPIS; IRS Criminal Investigation in Charlotte; and U.S. Treasury Inspector General for Tax Administration investigated the case.
Attorneys Joshua DeBold and Matt Kahn of the Criminal Division’s Fraud Section, along with Assistant U.S. Attorney Mark Odulio of the Western District of North Carolina prosecuted the case.
Since the establishment of the CARES Act, the DOJ has prosecuted nearly 200 defendants in more than 121 criminal cases, seizing over $78 million in cash proceeds obtained with fraudulent PPP funds, the DOJ said.
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The acquisitions have also included real estate properties and luxury items purchased with the fraudulent funds.