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Covid fraudster who bought property, Tesla Stock with stolen cash is caught

The businessman from Lebanon, Oregon, made tens of millions shopping for almost 16,000 shares of Tesla Inc., however lost all of it — alongside with his freedom — when the feds found out he had bankrolled his investments with proceeds from fraudulently obtained Covid-relief loans.

Hundreds of individuals have been prosecuted for falsely acquiring taxpayer-backed funds from plans supposed to assist small companies in the course of the pandemic, such because the Paycheck Protection Program. Many of them spent the money, and prosecutors have been capable of recuperate solely a fraction of it. But that wasn’t the case with Lloyd, the place the federal government bought again much more than he scammed.

Lloyd, 51, bought about $3.4 million by submitting faux functions within the names of companies owned by family and associates, all with out their data, in line with courtroom data. He used a number of the proceeds to purchase greater than 25 items of actual property in Oregon and California, prosecutors mentioned.

But his largest windfall got here with his 2020 buy of 15,740 shares of Tesla utilizing authorities money and a mortgage from Charles Schawb secured by equities he’d bought with the stolen cash. 

‘Increased Exponentially’

Tesla’s stock has skyrocketed since then, handing buyers returns of about 50% final year alone. Lloyd’s funding was price greater than $11 million on the time brokers seized his shares in January final year and $16.8 million on the shut of buying and selling Thursday.

“Lloyd transferred over $1.8 million of the PPP funds to his E*TRADE Securities brokerage account and purchased securities,” prosecutors mentioned in a courtroom submitting. “Fortunately for the government, and for Mr Lloyd’s restitution obligation discussed below, the value of those securities increased exponentially.”

Federal brokers additionally seized one other of Lloyd’s safety accounts, containing $660,000 in securities and cash.

Lloyd, who pleaded responsible in June to financial institution fraud, money laundering, and aggravated identification theft, was sentenced Thursday to 4 years in jail, in line with the U.S. Attorney’s Office in Oregon. He was additionally ordered to pay $4 million in fines, give up actual property bought with the ill-gotten money, and forfeit his brokerage accounts valued at $18 million.

His lawyer didn’t return a request for remark.

The case is U.S. v. Lloyd, 6:21-cr-00198, U.S. District Court, District of Oregon (Eugene).

 

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