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Case Number: 2:20-cr-00214-RJS
Judge: Robert J. Shelby
Court: United States District Court for the District of Utah (Salt Lake County)
Plaintiff's Attorney: United States District Attorney’s Office
Description: Salt Lake City, Utah criminal defense lawyers represented Defendants who were charged with unlawfully obtaining a Paycheck Protection Program (PPP) loan for Frisbu Trucking, Incorporated, where they were both employed.
Rowberry was sentenced to prison for a term of 12 months and a day last week in federal court. Her co-defendant, Hubert Ivan Ugarte, was sentenced to a term of 36 months in federal prison back in June for his role in the PPP loan fraud scheme. Ugarte’s sentence will run concurrently with a sentence that Ugarte received in a related case involving the bribery of officials at the Utah FedEx Ground Hub.
According to plea agreements in this case, Ugarte was the owner and operator of Frisbu Trucking, Inc. Ugarte hired Rowberry to work for Frisbu after she had been terminated from her role as an Assistant Vice President of U.S. Bank for engaging in financial transactions with Ugarte that violated U.S. Bank’s ethical policies. After Ugarte was indicted by a federal grand jury for his role in the FedEx bribery scheme, Ugarte’s many trucking businesses began to struggle because they were dependent on Ugarte’s ability to engage in business with the FedEx Ground Hub. In order to remain in business, Ugarte and Rowberry fraudulently applied for a PPP loan authorized by the Coronavirus Aid, Relief, and Economic Security (CARES) Act, and obtained $210,000 in loan funding. However, Rowberry and Ugarte both unlawfully failed to disclose that Ugarte was under federal indictment for his role in the FedEx bribery case.
The CARES Act is a federal law enacted on March 29, 2020, designed to provide emergency financial assistance to millions of Americans suffering from the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses through the PPP. In April 2020, Congress authorized more than $300 billion in additional PPP funding, and Congress again authorized more than 284 billion in Additional PPP funding in 2021.
PPP loan proceeds must be used by businesses on payroll costs, interest on mortgages, rent, and utilities. The PPP allows the interest and principal on the PPP loan to be entirely forgiven if the business spends the loan proceeds on these expense items within a designated period of time after receiving the proceeds and uses a certain amount of the PPP loan proceeds on payroll expenses.
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.
Assistant United States Attorneys in the Utah U.S. Attorney’s Office prosecuted the case against Rowberry and Ugarte. Special Agents from the FBI, IRS, and the Department of Transportation Office of Inspector General conducted the investigations.
18:1014 LOAN AND CREDIT APPLICATIONS GENERALLY Loan Application Fraud; 18:2 Aiding and Abetting; 18:982(a)(2)(A) Intent to Seek Forfeiture
Outcome: Hubert Ivan Ugarte:
SENTENCE: 36 months custody of BOP, which shall run concurrent with Sentence imposed in case 2:19CR00393 RJS, with credit for time served in federal custody. Upon release from custody the dft is placed on Supervised Release for a term of 36 months, which shall run concurrently with Supervised Release imposed in case 2:19CR00393-001 RJS. SPA of $100. No Fine. Restitution ordered: $220,500.00.
Lisa Bradshaw Rowberry:
12 months and 1 day, with credit for time served in federal custody. 3 years Supervised Release. No Fine. $100 SPA. Forfeiture ordered $220,000 joint and several with co-defendant Hubert Ivan Ugarte.