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Date: 10-29-2020
Case Style:
Case Number: 2:20-cr-00169-RAJ
Judge: Brian A. Tsuchida
Court: United States District Court for the Western District of Washington (Kind County)
Plaintiff's Attorney: United States District Attorney’s Office, Seattle, Washington
Defendant's Attorney:
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Description: Seattle, Washington wire fraud criminal defense lawyer represented defendant charged scheme to defraud several COVID-19 relief programs.
Baoke Zhang, 35, of Issaquah, Washington, pleaded guilty to one count of wire fraud as part of his guilty plea, Zhang admitted that he carried out a scheme to defraud several different government and private COVID-19 relief programs intended to assist those facing financial difficulties due to the ongoing pandemic.
Zhang admitted that he submitted four fraudulent applications to three different lenders for forgivable loans under the Paycheck Protection Program (PPP), a SBA program that provided payroll assistance to small businesses. To support the loan applications, Zhang used fake entities for which he created fake payroll and tax records. Two of the fraudulent loan applications sought $600,000 each, a third application sought $325,000, and a fourth sought approximately $41,000. Zhang also submitted a fraudulent application to the SBA for an Economic Injury Disaster Loan (EIDL) in the name of one of the fake entities for which he also had applied for PPP loans. The SBA paid Zhang a $10,000 EIDL advance before his fraud was detected.
Zhang further admitted that he submitted fraudulent applications to two non-profit organizations providing grants to restaurant workers suffering economic hardship due to the pandemic. Zhang submitted the various applications in the names of Zhang, his wife, and his parents, falsely claiming that each were restaurant workers who had either lost their jobs or lost wages due to COVID-19. To support the applications, Zhang created fake letters from purported restaurant owners regarding employment and fake payroll records. In fact, neither Zhang nor his wife or parents worked in restaurants. Zhang obtained $1,500 from one of the non-profits before his fraud was detected.
Zhang also admitted that he submitted a fraudulent application to a multinational technology company headquartered in Seattle, Washington, that was providing grants to qualifying small businesses in the Seattle area. Zhang falsely claimed in his application that he ran a small business in a local shopping center that had suffered economically due to the pandemic. In fact, Zhang did not own any businesses. Zhang obtained $5,000 from the relief program before his fraud was detected.
In total, Zhang admitted to attempting to defraud the various COVID-19 relief programs of more than $550,000.
This case was investigated by the SBA-OIG, the TIGTA, and the FBI. Trial Attorney Amanda R. Vaughn of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Brian Werner of the Western District of Washington are prosecuting the case.
Wire Fraud - 18:1343 and 2
(1)
Outcome: Defendant pleaded guilty.
Plaintiff's Experts:
Defendant's Experts:
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