Feds: Man stole $5M in COVID-19 aid
A Saugerties man who allegedly stole nearly $5 million in government-backed coronavirus loans could face up to 30 years in federal prison, the U.S. Attorney’s Office said Thursday.
Jean R. Lavanture, also known as Rudy Lavanture, 47, was apprehended on the 5.6-acre estate he is alleged to have purchased in New Jersey with the money he fraudulently received, authorities said. The arrest followed a “bank fraud complaint,” federal prosecutors said. He is charged with bank fraud.
The Coronavirus Aid, Relief, and Economic Security Act loans are meant to assist businesses struggling to survive the financial impact of the coronavirus pandemic.
Lavanture was scheduled to make an initial appearance late Thursday afternoon before a
United States Magistrate Judge in Newark.
If convicted of bank fraud, Lavanture faces up to 30 years in prison, up to five years of postimprisonment supervised release and a maximum fine of the greater of $1 million or twice his gross pecuniary gain or his victims’ gross pecuniary loss.
In a prepared statement, Acting U.S. Attorney Antoinette T. Bacon said, “According to the complaint, Jean Lavanture stole millions of dollars from important government programs created to help struggling commu
nities during the pandemic. We are on the lookout for fraud, and we will use all available tools to prosecute those who lie, cheat and steal from programs that America’s businesses and their employees so desperately need.”
FBI Special Agent in
Charge Thomas F. Relford called the allegations against Lavanture “appalling” and said “the FBI will not tolerate anyone who steals the funding designed to be a lifeline for those businesses.”
A criminal complaint alleges that between June 16 and July 22, Lavanture received about $4,906,281 in Paycheck Protection Program loans and Economic Injury Disaster Loans, which were issued by two banks and the Small Business Association to five Saugerties-based companies he controlled.
In the loan applications, Lavanture is alleged to have falsely represented that each company had employees, substantial revenues and payroll, and he submitted fraudulent tax documents in support of his lies, prosecutors said. In fact, according to the complaint, none of these companies has ever reported employees to the New York State Department of Labor, nor reported income to the IRS for 2017 through 2019.
The complaint also alleges that Lavanture has improperly used loaned funds to make property purchases and pay personal expenses, “further demonstrating his fraudulent intent,” according to a press release.
Lavanture allegedly withdrew about $439,503.25 of the loaned funds in cash, and drew on loaned funds when he purchased a motel in Rockaway Beach, Missouri, and transferred $952,000 in connection with the purchase of the 5.6-acre estate in Byram Township, N.J., that includes an 18room Tuscan-style mansion, prosecutors said.
The CARES Act is a federal law enacted in March and designed to provide emergency financial assistance to millions of Americans suffering from the economic effects of the COVID-19 pandemic. It includes forgivable loans to small businesses for job and employee retention and certain other expenses, through the Paycheck Protection Program.