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CHARLOTTE, North Carolina – March 17, 2022: Dena J. King, U.S. Attorney for the Western District of North Carolina,
announced today a federal jury in Charlotte found two men guilty of submitting fraudulent loan applications seeking more than $1.7 million in forgivable Paycheck Protection Program (PPP) loans guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security (CARES) Act.
Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department's Criminal Division, Inspector in Charge Tommy Coke of the United States Postal Inspection Service, Atlanta Division, Special Agent in Charge Donald "Trey" Eakins of IRS Criminal Investigation (IRS CI), Charlotte Field Office, and J. Russell George, Treasury Inspector General for Tax Administration, join U.S. Attorney King in making today's announcement (TIGTA).
Izzat Freitekh, 55, of Waxhaw, North Carolina, and his son Tarik Freitekh, aka Tareq Freitekh, 33, of Glendale, California, obtained $1.7 million in fraudulent proceeds by submitting multiple fraudulent PPP loan applications for companies owned by Izzat Freitekh: La Shish Kabob, La Shish Kabob Catering, Green Apple Catering, and Aroma Packaging, according to evidence presented during a six-day trial. The number of employees and payroll expenses on the loan applications were both false. After acquiring the false loan profits, the defendants used the funds to engage in illegal financial transactions, including sending $30,000 payments to family members.
Western District of North Carolina Department of Justice:
“While businesses were suffering and doing their best to make it through the pandemic, others chose greed,” said Special Agent in Charge Eakins. “IRS CI will continue to utilize its financial expertise to follow the money and recommend the prosecution of criminals taking advantage of a crisis.”
“Today’s results demonstrate the commitment of the Treasury Inspector General for Tax Administration to investigate and bring to justice those who attempt to corruptly interfere with federal tax administration,” said Inspector General George. “We appreciate the work of the U.S. Attorney’s Office and our law enforcement partners to ensure this criminal activity is held to account.”
Izzat Freitekh was convicted of one count of conspiracy to commit money laundering, three counts of money laundering, and one count of making false statements. He faces up to 10 years in prison for conspiracy to commit money laundering, 10 years in prison for each of the money laundering counts, and five years in prison for the false statements count.
Tarik Freitekh was convicted of one count of conspiracy to commit wire fraud, one count of bank fraud, one count of conspiracy to commit money laundering, one count of money laundering, and one count of falsifying and concealing material facts. He faces up to 30 years in prison for the bank fraud count, 20 years in prison for the wire fraud and money laundering conspiracies, 10 years in prison for the money laundering count, and five years in prison for the falsifying material facts count.
A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. Law enforcement previously obtained and executed seizure warrants for over $1.3 million in proceeds of the fraud, held in various accounts. The seized money was administratively forfeited by the federal government prior to the trial.
The US Postal Inspection Service, IRS-CI, and TIGTA investigated the case.
Trial Attorneys Joshua N. DeBold and Matt Kahn of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Mark Odulio of the Western District of North Carolina prosecuted the case. Assistant U.S. Attorney Benjamin Bain-Creed of the U.S. Attorney’s Office Civil Division is in charge of the forfeiture proceedings.
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 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 via the NCDF Web Complaint Form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
Wnctimes by Marjorie Farrington
