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Two brothers charged with $7 million COVID-relief fraud scheme

COVID-19
Posted at 3:20 PM, Sep 10, 2020
and last updated 2020-09-10 15:20:39-04

Two brothers from Western New York are facing fraud charges after prosecutors say they tried to scheme the federal government out of $7 million in COVID-relief aid.

Larry Jordan, 42 of Lancaster, and Sutukh El, 38 of Buffalo, are charged with wire fraud conspiracy. According to a criminal complaint, the men filed fraudulent loan applications for forgivable Paycheck Protection Program loans under the CARES Act and used the money for personal expenses.

Prosecutors say the brothers submitted at least eight fraudulent applications on behalf of their company, 5 Stems Inc. The applications were accompanied by falsified federal tax filings, the complaint states.

The men received approximately $600,000 from the Small Business Adminisration, and spent the money on personal expenses such as home improvement projects and a vehicle. The federal government has seized more than $400,000 of the more than a half million dollars paid out to the defendants.

The brothers each face 20 years in prison if convicted.