A former Pizzeria owner was arrested on Tuesday for committing fraud after misappropriating $660,000 worth of Paycheck Protection Program (PPP) loan funds —a federal program established last year to help small businesses affected by the coronavirus.
Dana L. McIntyre, 57, now a resident of Grafton, Vermont, previously owned Rasta Pasta Pizzeria in Beverly, Massachusetts. In April 2020, according to the alleged complaint, McIntyre applied for a PPP loan of over $660,000.
"In the application, McIntyre allegedly inflated information about the pizzeria's employees and payroll expenses and falsified an official tax form in an effort to qualify the business for a larger loan amount," stated the Department of Justice
U.S. Attorney's Office, District of Massachusetts in a news release on Tuesday.
According to the statement, "McIntyre allegedly reported that the pizzeria employed nearly 50 individuals; however, records indicate that the business paid fewer than 10 employees at any time before or after McIntyre submitted the loan application."
As per further allegations, he sold the pizzeria after receiving the loan, according to the statement, and used almost all of the money to buy a farm in Vermont and fill it with several alpacas. Other personal expenses included at least two cars and weekly airtime for a cryptocurrency-themed radio show.
"My client denies the allegation and will have further comment at a later date," McIntyre's attorney, Jason Stelmack, told the Associated Press.
McIntyre, who made a virtual appearance in federal court in Boston on Tuesday, was charged with one count of wire fraud and one count of money laundering, according to the authorities.
Former North Shore pizzeria owner arrested in connection w/ allegedly filing fraudulent loan application to obtain over $660,000 in Paycheck Protection Program (PPP) funds & using those funds for personal expenses, including buying alpaca farm in Vermont https://t.co/rMZcd3iUXu
— U.S. Attorney MA (@DMAnews1) May 4, 2021
If sentenced for all charges, McIntyre will face a total of 40 years of prison time —20 years for each charge of wire fraud and money laundering; along with a fine of $750,000 total, according to AP.
On March 29, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was introduced to provide economic assistance for American workers, families, small businesses, and industries affected by the COVID-19 pandemic. Under the CARES act, authorization of forgivable loans for small businesses was designed to provide a direct incentive for small businesses to keep their workers on the payroll.
Unfortunately, PPP loans were taken advantage of in some cases. As per the latest report from the House Coronavirus Oversight Committee, $84 billion in PPP loan claims are potentially fraudulent.
