MIAMI — Valesky Barosy, 27, of Ft. Lauderdale, Fla., has been convicted for fraudulent submission of COVID-19 relief loans under the Paycheck Protection Program (PPP).
Barosy submitted dozens of fraudulent PPP loan applications on behalf of himself and his accomplices that sought more than $4.2 million and successfully obtained more than $2 million. In each loan application, Barosy falsified the applicant’s prior year expenses, net profit or payroll, and submitted fraudulent Internal Revenue Service tax forms. Barosy’s fraudulent loan applications, and their accompanying fabricated tax documents, were found on his computer along with text messages soliciting information from prospective clients.
For each loan application, Barosy’s accomplices paid him a 20 to 30 percent kickback that he used to purchase a Lamborghini Huracán EVO, Rolex and Hublot watches, and designer clothing from Louis Vuitton, Gucci, and Chanel. Barosy posted photos on his Instagram account of the Lamborghini and watches, detailing his success as an entrepreneur. But his greatest success, according to one text message, was his ability to “max out ppp. I do them very good,” he boasted.
Barosy was convicted by a jury on five counts of wire fraud, three counts of money laundering, and aggravated identity theft. Sentencing is set for February 23, 2023. He is facing at least two years and up to 132 years in prison, as well as restitution and forfeiture of the loan proceeds.
Juan Antonio Gonzalez, U.S. Attorney for the Southern District of Florida, and Special Agent in Charge Brian Swain, U.S. Secret Service (USSS), Miami Field Office, made the announcement.
USSS, Miami Field Office, investigated the case. Assistant U.S. Attorneys Jonathan Bailyn and Joseph Egozi are prosecuting it. Assistant U.S. Attorney Nicole Grosnoff is handling asset forfeiture.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act is a federal law enacted on March 29, 2020, designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses, through PPP. In April 2020 Congress authorized over $300 billion in additional PPP funding.
PPP allows qualifying small businesses and other organizations to receive loans with a maturity of two years and an interest rate of 1%. PPP loan proceeds must be used by businesses on payroll costs, interest on mortgages, rent, and utilities. PPP allows the interest and principal on the loan to be forgiven if the business spends the loan proceeds on these expense items within a designated period of time after receiving the proceeds and uses at least a certain percentage of the PPP loan proceeds on payroll expenses.
On September 15, 2022, the Attorney General selected the Southern District of Florida’s U.S. Attorney’s Office to head one of three national COVID-19 Fraud Strike Force Teams. The Department of Justice established the Strike Force to enhance existing efforts to combat and prevent COVID-19 related financial fraud. For more information on the department’s response to the pandemic, please click here.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For information on the department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or at http://pacer.flsd.uscourts.gov under case number 21-cr-60345.