A Houston man has been arrested after he allegedly obtained and fraudulently used more than $ 1.1 million in Paycheck Protection Program loans to purchase cryptocurrency and pay for personal expenses.
In an announcement made Tuesday by the US Department of Justice, Joshua Thomas Argires, 29, is indicted in a criminal complaint that was unsealed on Monday.
Argires allegedly made false statements to financial institutions, committed electronic and banking frauds, and engaged in illegal monetary transactions. He made his first appearance Monday before US trial judge Peter Bray.
PPP loans are guaranteed by the Small Business Administration under the CARES (Coronavirus Aid, Relief and Economic Security) law. The loans are intended to help businesses keep their employees on the payroll during the coronavirus pandemic.
The complaint states that Argires applied for two PPP loans – one on behalf of an entity called Texas Barbecue and another on behalf of a company called Houston Landscaping. He reportedly claimed that the companies had “many” employees and “hundreds of thousands of dollars” in payroll expenses.
Neither Texas Barbecue nor Houston Landscaping have the number of employees or salary expenses claimed by Argires, the complaint says.
Argires reportedly received funds from the loans, but none of the money was used to pay employees or other expenses permitted under the P3.
According to the charges, funds received on behalf of Texas Barbecue were invested in a cryptocurrency account and Houston Landscaping funds were placed in a bank account and slowly depleted through ATM withdrawals.
Under the March CARES law, $ 349 billion was allocated in forgivable loans to small businesses to help keep jobs and cover expenses related to COVID-19. An additional $ 300 billion in P3 funds was authorized by Congress in April.
Companies that obtain P3 funding are required to use the money for salary costs, mortgage interest, rent, and utilities. If used correctly and within a certain period of time, the interest and principal of the loan is canceled.
A federal criminal complaint is only an accusation. An accused is presumed innocent until proven guilty beyond a reasonable doubt in court.
The Office of the Inspector General (OIG) of the Federal Housing Finance Agency, the SBA OIG, and the Houston Division of the United States Postal Inspection Service conducted the investigation. Prosecutor Timothy A. Duee of the Fraud Section of the Criminal Division and Assistant U.S. Attorney James McAlister for the Southern District of Texas are continuing the case.
Claire Kowalick, senior reporter for the Times Record News, covers local government, military and MSU Texas. If you have any info, contact Claire at [email protected]