CHARLOTTE, N.C. — A federal jury in Charlotte convicted two men on Thursday for 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.
Authorities say Izzat Freitekh, 55, of Waxhaw, N.C. and his son Tarik Freitekh, 33, of Glendale, C.A. got $1.7 million in fraudulent proceeds by submitting multiple fraudulent PPP loan applications for companies owned by Izzat Freitekh including: La Shish
Kabob, La Shish Kabob Catering, Green Apple Catering, and Aroma Packaging.
The loan applications misrepresented the number of employees and payroll expenses, according to a news release.
After obtaining the loans, authorities say the father and son engaged in unlawful monetary transactions with the proceeds of the scheme, including making $30,000 payments to family members.
“The wicked borrow and do not repay, but in the Freitekhs’ case they also lie to cover up the fraud,” said U.S. Attorney King. “This father and son duo exploited a national emergency for their own benefit, then tried to obstruct justice to avoid punishment. A federal jury saw through their criminal shenanigans and now the Freitekhs will be held accountable for their actions. Protecting important taxpayer-funded programs remains a priority for my office, and together with our law enforcement counterparts we will continue to identify and prosecute those who exploit these programs for their own profit.”
Izzat Freitekh was convicted on one county of conspiracy to commit money laundering, three counts of money laundering, and one count of making false statements, according to a news release.
Authorities say 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, according to a news release.
Tarik Freitekh
Authorities say 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.
“The CARES Act was intended to help people and businesses harmed by the pandemic, not to line the pockets of greedy individuals. The U.S. Postal Inspection Service will continue to work with our partners to hold accountable those who lie and cheat the government out of money to enrich themselves,” said Inspector in Charge Coke.
