A criminal complaint was overturned today in federal court in Brooklyn indicting Leon Miles of wire fraud in connection with his plan to receive over $ 1.9 million from the Paycheck Protection Program (PPP) that Congress granted as part of the Coronavirus Aid, Relief and Economic Security (CARES) Act. Miles was arrested this morning and will appear before US Judge Vera M. Scanlon this afternoon.
Seth D. DuCharme, acting United States attorney for the Eastern District of New York; William F. Sweeney Jr., assistant executive director, Federal Bureau of Investigation, New York Field Office (FBI); Amaleka McCall-Brathwaite, Special Representative in Charge, Office of the Inspector General of the US Small Business Administration, Eastern Region Office (SBA-OIG); and Jonathan D. Larsen, Special Representative in Charge, Internal Revenue Service, New York Criminal Investigation Department (IRS-CI) announced the arrest and indictment.
"At a time when so many are suffering from the devastating economic effects of the ongoing pandemic, Miles has allegedly enriched himself at the taxpayer's expense, stealing funds intended by Congress to keep companies and workers on payroll," said Acting United States Attorney DuCharme. "Together with our agency partners, this office will bring to justice those who are exploiting a global crisis to commit such crimes."
"We continue to see people taking advantage of the paycheck protection program, which was created to provide emergency financial aid to businesses in need of it during the pandemic," said Sweeney, FBI deputy director. “This type of criminal behavior is a slap in the face for anyone who rules by the rules, especially while so many in our communities are suffering the financial consequences of the pandemic. The FBI will continue to aggressively pursue those using the money from this taxpayer-funded economic aid program to fill their own pockets. If you know of similar fraud cases, please call us at 1-800-CALL-FBI.
"Fraudsters who have made a personal profit at the expense of the taxpayer will be brought to justice," said McCall-Brathwaite, the special representative in charge of the SBA OIG. "Greed has no place in the SBA's programs to assist the country's small businesses grappling with the challenges of the pandemic. I would like to thank the US Attorney General and our law enforcement partners for their dedication and pursuit of justice . "
"While most Americans are struggling during this pandemic, we keep seeing criminals trying to realize their dreams of a lavish lifestyle," said the responsible IRS CI special agent Larsen. "Miles allegedly submitted a nearly $ 2 million PPP loan application and provided false information. He is said to have used some of these funds to buy luxury vehicles. These types of acts hurt our people, our government and our country. IRS Criminal Investigation and our law enforcement partners will work together until every abusive PPP loan is booked and criminals are brought to justice. "
The CARES Act is a federal act passed on March 29, 2020 to provide emergency financial aid related to the economic impact of the COVID-19 pandemic. One source of relief from the CARES Act has been the allocation of funds for the issuance of loans made to small businesses to keep jobs and certain other expenses under the PPP. The PPP enabled qualified small businesses to obtain unsecured loans on favorable terms that they had to use for certain expenses, including labor, mortgage interest, rent and utilities. The PPP provided for the loan to be forgiven when the recipient companies spent the proceeds on these specified expenses within a limited period of time and used a certain percentage for labor costs.
As alleged in the complaint, Miles filed an application for a $ 1,904,593.00 PPP loan on behalf of a limited liability company in Brooklyn, New York, in May 2020, falsely claiming the company had 50 employees and an average total monthly wage bill of $ 761,838.00. In support of these claims, Miles filed fraudulent personal and commercial tax returns and tax forms that were never filed with the IRS. In fact, he did not report any taxable income to the IRS during the relevant period, and his company did not file tax returns or report wages paid to workers. The loan proceeds were paid into the defendant's personal savings account and within a few days he had withdrawn hundreds of thousands of dollars, part of which he bought to purchase a 2020 Bentley Continental for approximately $ 250,000 and a 2020 Cadillac Escalade for approximately $ 100,000.
The charges are allegations and the defendant is presumed innocent unless and until proven guilty.
The government case is being pursued by United States Assistant Attorney Robert M. Pollack, with the assistance of U.S. Assistant Attorney Brian D. Morris, of the Office's Property Foreclosure Division.
Age: 51 years
Brooklyn, New York
E.D.N.Y. File number 20-MJ-1234