A federal grand jury in Santa Ana, California, returned a superseding indictment today charging a California man with wire fraud and money laundering for making fraudulent claims to the Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL) program, two federal programs created to provide financial assistance to Americans suffering economic harm as a result of the COVID-19 pandemic. He had previously been charged with tax evasion and filing false corporate tax returns, according to the U.S. Department of Justice.
According to the superseding indictment, from May 2020 to December 2021, Mehrdad “Mitch” Tabrizi, of Aliso Viejo, submitted two fraudulent PPP applications on behalf of Life Fleet Inc., a California business he owned, seeking $695,565 in loans. In the applications, Tabrizi allegedly claimed that Life Fleet had at least 54 employees and monthly payroll obligations of $139,313. After receiving the PPP funds, Tabrizi allegedly used the proceeds for personal expenses. Similarly, Tabrizi allegedly filed a false EIDL application claiming that Life Fleet had gross revenues of more than $4 million and 63 employees. In reality, however, Life Fleet allegedly was not in business, had no revenue and had no employees.
Tabrizi also allegedly filed a fraudulent EIDL application in the name of Resonante Group Inc., a California company he controlled. According to the superseding indictment, this EIDL application falsely claimed Resonante Group had gross revenues of more than $19 million and over 300 employees. As a result, the Small Business Administration allegedly disbursed approximately $319,800 into bank accounts controlled by Tabrizi, which he was not entitled to receive and used for personal expenses.
Tabrizi was previously charged with tax evasion and filing false tax returns. According to the superseding indictment, Tabrizi operated Socal Medical Transportation Inc., a company incorporated in California. In 2015 and 2016, Tabrizi allegedly deposited approximately $2.6 million of income into a bank account but did not disclose these funds to the CPA firm he hired to prepare Socal Medical’s corporate tax returns. Instead, Tabrizi allegedly informed the CPA firm that these funds had been received by a separate business.
If convicted, he faces a maximum penalty of 20 years in prison for each of four counts of wire fraud, 10 years in prison for each of four counts of money laundering, five years in prison for each of two counts of tax evasion and three years in prison for each of two counts of filing false tax returns. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Martin Estrada of the U.S. Attorney’s Office for the Central District of California made the announcement.
IRS Criminal Investigation is investigating the case.
Trial Attorney Boris Bourget of the Justice Department’s Tax Division and Assistant U.S. Attorney Brett Sagel for the Central District of California are prosecuting the case.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
More proof that the amount of due diligence our government did in the pandemic response was next to nothing. The professional class stayed home and bought real estate, the “essential workers” slaved away for minimum wage in high-risk conditions, the rich got richer, and the ruling class consolidated power. Success! Hey, at least nobody got covid….