Please E-mail suggested additions, comments and/or corrections to Kent@MoreLaw.Com.
Date: 04-11-2023
Case Style:
Case Number: 1:19-cv-03919
Judge: Andrew L. Carter
Court: United States District Court for the Southern District of New York (Manhattan County)
Plaintiff's Attorney: United States District Attorney's Office in New York City
Defendant's Attorney:
Description: New York City, New York criminal defense lawyers represented Defendant charged with orchestrating a sprawling loan fraud scheme, including while he was on pretrial release, whereby he fraudulently sought at least $6.14 million and received $1.5 million in Government-guaranteed loans designed to provide relief to small businesses during the COVID-19 pandemic.
“Manhattan restaurateur Besim Kukaj took advantage of the hardships created by the COVID-19 pandemic and the federal government’s efforts to help those in need by lining his own pockets with seven figures of illegally obtained funds. He did this out of pure greed, sending some of this money to a Florida real estate developer and using it to buy luxury items from Cartier and Hugo Boss. He even continued to commit the same crimes while he was on bail. And he didn’t stop there. He directed his co-conspirator to physically threaten a victim to whom he owed money. For his brazen crimes, Kukaj will serve meaningful time in prison.”
According to court filings and statements made in court proceedings:
The Coronavirus Aid, Relief, and Economic Security (“CARES”) Act is a federal law enacted on March 29, 2020, designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of hundreds of billions of dollars in forgivable loans to small businesses for job retention and certain other expenses through the Small Business Administration’s Paycheck Protection Program (“PPP”) and additional billions for the separate Economic Injury Disaster Loan program (“EIDL”). Pursuant to the CARES Act, the amount of PPP funds a business is eligible to receive is determined in significant part by the number of employees employed by the business and their average payroll costs. The amount of a loan under the EIDL program is determined in part by a formula based on the date the borrower began operating and the borrower’s gross revenue and cost of goods sold during a period before the pandemic. The loans can be used only for working capital and other normal operating expenses. Businesses applying for loans under the PPP and EIDL program must confirm the accuracy of their loan statements.
From at least in or about April 2020 through at least in or about July 2020, KUKAJ, working with others, submitted applications for loans under the EIDL program and the PPP to multiple banks on behalf of various restaurants KUKAJ or a relative of his owned. He did so on behalf of restaurants that were no longer operating or that had far less revenue and far fewer employees than were listed on the loan applications. KUKAJ and his co-conspirators applied for dozens of loans, totaling at least $6.14 million, from numerous financial institutions, using many different corporate entities, and they successfully received at least $1.5 million in loans.
KUKAJ was arrested in October 2020 and charged with bank fraud conspiracy and later indicted for the same charges in December 2020. He was released on pretrial release under a court order that notified him of the potential effect of committing a crime while on pretrial release. KUKAJ violated the terms of his bail for continuing to file false loan applications while on pretrial release for the same conduct. Specifically, in 2021, while on pretrial release, KUKAJ filed additional false loan applications that inflated the businesses’ number of employees and payrolls and falsely claimed that he was not under indictment.
Separately, on November 6, 2019, at the urging of KUKAJ, co-defendant Abduraman Iseni placed a telephone call to a victim, in which Iseni threatened physical violence against the victim. KUKAJ instructed Iseni to place this call because KUKAJ owed money to the victim.
* * *
In addition to the prison sentence, KUKAJ, 43, of Fort Lee, New Jersey, was ordered to pay forfeiture of $1,500,000 and restitution in the amount of $1,500,000 to the U.S. Small Business Administration.
Mr. Williams praised the outstanding work of the Federal Bureau of Investigation New York’s Balkans and Middle East Organized Crime Squad, as well as the Small Business Administration Office of the Inspector General, the Social Security Administration Office of the Inspector General, and the New York State Liquor Authority for their investigative efforts and ongoing support and assistance with the case.
The prosecution of this case is being overseen by the Office’s Money Laundering and Transnational Criminal Enterprises Unit. Assistant U.S. Attorneys David R. Felton and Samuel L. Raymond are in charge of the case.
18:1349.F ATTEMPT AND CONSPIRACY TO COMMIT BANK FRAUD
(1s)
18:875C.F INTERSTATE COMMUNICATIONS - THREATS
(2s)
18:371.F CONSPIRACY TO COMMIT INTERSTATE EXTORTION AND INTERSTATE THREATS
(4)
18:875B.F INTERSTATE EXTORTIONATE COMMUNICATIONS
(5)
18:875C.F INTERSTATE THREATS
(6)
18:1349.F BANK FRAUD CONSPIRACY
(7)
Outcome: Defendant was sentenced to 57 months in prison.
Plaintiff's Experts:
Defendant's Experts:
Comments: