Date: 03-29-2024

Case Style:

United States of America v. JOHN MATAVA

Case Number:

Judge: Kari A. Dooley

Court: The United States District Court for the District of Connecticut

Plaintiff's Attorney: The United States Attorney’s Office for New Haven

Defendant's Attorney:

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Description:

New Haven, Connecticut criminal defense lawyer represented the Defendant charged with Fraudulently Obtaining COVID-19 Relief Funds.

Coventry Man Sentenced to 2 Years in Prison for Fraudulently Obtaining COVID-19 Relief Funds

Vanessa Roberts Avery, United States Attorney for the District of Connecticut, announced that JOHN MATAVA, 60, of Coventry, was sentenced today by U.S. District Judge Kari A. Dooley in Bridgeport to 24 months of imprisonment, followed by three years of supervised release, for offenses related to his receipt of COVID-19 relief funds.

In March 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act provided emergency financial assistance to Americans suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of forgivable loans to small businesses for job retention and certain other expenses through the Paycheck Protection Program (PPP). In April 2020, Congress authorized more than $300 billion in additional PPP funding. The PPP allowed qualifying small businesses and other organizations to receive unsecured loans at an interest rate of 1%. PPP loan proceeds were to be used by businesses on payroll costs, interest on mortgages, rent and utilities. The PPP allowed the interest and principal to be forgiven if businesses spent the proceeds on these expenses within a certain period of time of receipt and used at least a certain percentage of the amount to be forgiven for payroll.

The PPP was overseen by the Small Business Administration, which has authority over all PPP loans. Individual PPP loans, however, were issued by private approved lenders, such as Celtic Bank, which received and processed PPP applications and supporting documentation, and then made loans using the lenders’ own funds, which were guaranteed by the SBA.

According to court documents and statements made in court, in April 2020, Matava applied to Celtic Bank for a $100,000 PPP loan for J.M. Builders LLC. The application submission included several false representations, including that J.M. Builders LLC had eight employees and an average monthly payroll of $40,000; that the monies would be used for payroll, lease, mortgage, interest, and utilities; and that the business owner was not subject to pending formal criminal charges. At the time of the PPP loan application, there were no records of payroll or employees with the Connecticut Department of Labor for J.M. Builders LLC, and Matava was subject to criminal charges in two pending cases related to arrests in 2017 and 2018.

On April 22, 2020, Celtic Bank disbursed $100,000 to a bank account for J.M. Builders LLC on which Matava was the signatory. The account was opened on April 21, 2020, and had a balance of $0 immediately prior to the loan funds being disbursed. Between April 2020 and January 2021, Matava used the funds primarily for personal expenditures, including $3,498 to pay a dog breeder, $4,777 for payments to an RV superstore in Connecticut, and legal fees, including a $2,000 retainer, for four court cases in Rockville, Connecticut.

In January 2021, Matava sought $100,000 in additional PPP funds from Celtic Bank, and included with the application several additional false statements and fraudulent tax documents. Celtic Bank denied the application.

Judge Dooley ordered Matava to pay restitution of $100,000.

Matava was arrested on January 7, 2023. On January 2, 2024, he pleaded guilty to one count of wire fraud affecting a financial institution and one count of making an illegal monetary transaction.

Matava is released on a $60,000 bond, in home detention. He is required to report to prison on May 13.

This matter was investigated by the Federal Bureau of Investigation and the Internal Revenue Service – Criminal Investigation. The case was prosecuted by Assistant U.S. Attorneys Christopher W. Schmeisser and Sean P. Mahard.

Outcome:

Defendant was found guilty and sentenced to 24 months of imprisonment, followed by three years of supervised release.

Matava is released on a $60,000 bond, in home detention. He is required to report to prison on May 13.

Plaintiff's Experts:

Defendant's Experts:

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