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Case Number: 23-cr-02352
Judge: Anthony J. Battaglia
Court: United States District Court for the Southern District of California (San Diego County)
Plaintiff's Attorney: United States Attorney’s Office in San Diego
Description: San Diego, California criminal defense lawyer represented the Defendant charged with committing fraud to obtain almost $3 million intended to help those affected by the COVID-19 pandemic.
In his plea agreement, Thomas Zolezzi of San Diego, admitted he submitted five loan applications containing false statements to trick lenders into providing the relief funds. He used the borrowed funds to pay his personal expenses. As part of his guilty plea, Zolezzi agreed to pay restitution of $700,884.75 to the Small Business Administration (“SBA”) and $2,238,910.24 to Capital Plus Financial.
The Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was enacted on March 27, 2020, to provide over $2 trillion of economic relief to workers, families, small businesses, industry sectors and other levels of government that were hit hard by the public health crisis created by COVID-19. The CARES Act authorized the SBA to temporarily guarantee loans under a new loan program titled the Paycheck Protection Program (“PPP”).
Under the PPP, financial institutions made loans to qualified borrowers, and the SBA backed the loans. Borrowers agreed to use the PPP loans to cover payroll costs and certain eligible nonpayroll costs. In some cases, the borrower could apply for forgiveness of the loan. If approved for forgiveness, the SBA paid the loan for the borrower.
The CARES Act also authorized the SBA to provide Economic Injury Disaster Loans (“EIDL”). Borrowers agreed to use EIDL funds solely as working capital to alleviate economic injury caused by the disaster. Working capital expenses included payroll expenses, sick leave, production costs, and ordinary business obligations, like debts, rent, and mortgage payments.
According to court records, Zolezzi applied for and received three PPP loans and two EIDLs. Zolezzi’s loan applications, which started in May 2020, falsely overstated the number of his employees, his payroll amount, and his annual revenue to fraudulently obtain $2,939,794.99 in loans.
Sentencing is scheduled for February 5, 2024, at 9 a.m. before U.S. District Judge Anthony J. Battaglia.
This case is being prosecuted by Assistant U.S. Attorney Christopher Alexander.
DEFENDANT Case Number 23-cr-02352 -AJB
Thomas Zolezzi Age: 61 San Diego, CA
SUMMARY OF CHARGES
Wire Fraud, a felony, in violation of Title 18, United States Code, Section 1343
Maximum Penalty: Twenty years in prison and a fine of $250,000
Homeland Security Investigations, Immigration and Customs Enforcement
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (“NCDF”) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
Outcome: Defendant elected to plead guilty.