Date: Feb. 7, 2024 Contact: newsroom@ci.irs.gov W. Stephen Muldrow, U.S. Attorney for the District of Puerto Rico, announced the indictment of 19 individuals for their participation in a scheme to illegally obtain federal recovery funds under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The Grand Jury charged the defendants with multiple counts of wire fraud and money laundering. The charging documents allege that from April 2020 through February 2024, the defendants and their co-conspirators caused the submission of at least 30 Paycheck Protection Program (PPP) loan applications seeking the illegal disbursement of at least $587,442 in federal recovery funds from the U.S. Small Business Administration (SBA) and Bank 1. “This is the fifth round of defendants charged since April 2023 relating to this fraud scheme. The investigation remains ongoing, and we expect more charges,” said U.S. Attorney Muldrow. “Today I make the same recommendation that I have in the past – if you are involved in criminal activity, contact law enforcement and cooperate. It will be better for you if you come forward than if you wait for the feds to knock on your door.” “In IRS Criminal Investigation we have been working on these complex cases for almost three years. The investigations include multiple special agents and expert personnel from several federal agencies,” said Matthew D. Line, Special Agent in Charge of the IRS-CI Office in Miami. “Twenty-four IRS:CI special agents coordinated today’s operation were responsible for the arrest of five people this morning. Our message is one and it is clear: we will continue to work tirelessly to bring to justice those who commit criminal acts or defraud our taxpayers, no matter who they are or where they are.” “Scheming to fraudulently obtain federal funds that are meant to provide assistance to the nation’s small businesses is unacceptable,” said SBA OIG’s Eastern Region Special Agent in Charge Amaleka McCall-Braithwaite. “OIG will aggressively root out organized fraud rings that seek to wrongfully take advantage of pandemic relief program funds. Today’s arrests serve as a reminder that each fraudulent action is like footprints in concrete, and wrongdoers will be brought to justice. I want to thank the U.S. Attorney’s office and our law enforcement partners for their support and dedication to pursuing justice in this case.” Internal Revenue Service Criminal Investigations, the United States Secret Service, the Small Business Administration Office of the Inspector General, and the Treasury Inspector General for Tax Administration conducted the investigation with the collaboration of the Puerto Rico Treasury Department, the Puerto Rico Bureau of Special Investigations, the Puerto Rico Police Bureau, and the Guaynabo Municipal Police. According to court documents, defendants José Carmona Morales, a.k.a. “Cheka” and Cecy Casiano Santiago, together with Manfred A. Pentzke Lemus, a.k.a. “Man/Contable/El Gestor”, Rodolpho R. Pagesy Roussel, a.k.a. “El Banquero”, Augusto A. Lemus Berrios, a.k.a. “Primo”, Jonatan Ben David Prieto Ruiz De Val, a.k.a. “Johnny Millones”, Ligia María Lemus De Pentzke, and others knowingly devised a scheme to defraud the SBA and Bank 1 to obtain federal money and property by means of materially false and fraudulent pretenses, representations, and promises submitted through applications for EIDL and PPP loans made available through the CARES Act to help small businesses recover from the impact of the pandemic. Pentzke Lemus, Pagesy Roussel, Lemus Berrios, Prieto Ruiz De Val, and Lemus De Pentzke were previously charged in April 2023 in a separate indictment. The defendants are: José Carmona Morales, a.k.a. “Cheka” Cecy Casiano Santiago Arnaldo Dávila Rivera Cruz Sheila Pérez Guzmán Emmanuel Maysonet Cruz Janelle Irene Fe Cooney Delgado Jesús Rodríguez Maysonet Julia Cecilia Santiago Salgado Nelson Noriega Sotomayor Héctor Martínez Ortiz Carolyn González Marrero Edyel León Rivera Ángel Febus Muñoz Verónica Vázquez Molina Karishna Ayala Otero Lilliam Collazo Pérez Rebecca Serrano Martínez Rosa Casanova Salgado Tatiana Lebrón The CARES Act authorized federal assistance through the issuance of SBA loans to small businesses and non-profit entities that experienced revenue loss due to the COVID-19 worldwide pandemic. The EIDL program was one such loan assistance program for small businesses. To procure the loan, applicants had to fill out an online application detailing operational information for the 12‑month period prior to the COVID-19 pandemic, such as the number of employees in the business, the gross business revenues realized, and the cost of goods sold. Another form of assistance provided by the CARES Act was the authorization of United States taxpayer funds in forgivable loans to small businesses for job retention and certain other expenses, such as interest on mortgages, rent and utilities, through the Paycheck Protection Program (PPP). The indictment alleges that the defendants submitted at least 30 fraudulent PPP loan applications containing materially false and fraudulent information and false documents, including false and fictitious tax documents, payroll records, bank records, and identification documents, to procure the disbursement of PPP assistance loans by Bank 1. The indictment further alleges that the defendants and their co-conspirators directed the recipients of the fraudulently obtained PPP loans to remit a portion of the proceeds of the loans to the defendants and their co-conspirators and used the loan proceeds to benefit themselves and others, and to pay for expenses prohibited under the requirements of the PPP programs. Defendants José Carmona Morales, a.k.a. “Cheka” and Cecy Casiano Santiago are facing one count of conspiracy to commit money laundering, for knowingly conducting financial transactions involving the proceeds of wire fraud, together with other individuals previously indicted. The defendants, including José Carmona Morales, a.k.a. “Cheka”, are also alleged to have recruited other unindicted co-conspirators to not only obtain additional EIDL and PPP loans under false pretenses, but recruit others to submit fraudulent applications. If convicted, the defendants are facing up to 30 years in prison for the wire fraud counts. José Carmona Morales, a.k.a. “Cheka” and Cecy Casiano Santiago are also facing up to 20 years of imprisonment for the money laundering count. Assistant U.S. Attorney (AUSA) Timothy R. Henwood, Chief of the Criminal Division, and AUSA Daniel J. Olinghouse are in charge of the prosecution of the case. An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
