Bloomsburg Couple Plead Guilty To Committing Over $430,000 Money Laundering Scheme, Including $300,000 In Covid-Relief Fraud
WILLIAMSPORT- The United States Attorney’s Office for the Middle District of Pennsylvania announced that on October 18, 2021, Darryl Corradini, age 63, and Vicki Hackenberg, age 57, both of Bloomsburg, Pennsylvania, pleaded guilty before Chief District Court Judge Matthew W. Brann to conspiring to commit money laundering. The laundering activities involved hundreds of thousands of fraudulently obtained funds, including nearly $300,000 in COVID-19 relief guaranteed by the Small Business Administration through the Paycheck Protection Program (PPP).
The PPP is designed to help small businesses facing financial difficulties during the COVID-19 pandemic. Funded by the March 2020 CARES Act, PPP funds are offered in forgivable loans, provided that certain criteria are met, including use of the funds for employee payroll, mortgage interest, lease, and utilities expenses.
According to Acting U.S. Attorney Bruce D. Brandler, Corradini and Hackenberg admitted to assisting their coconspirators by creating a shell corporation, CGM Realty LLC, and opening bank accounts and a Bitcoin trading account in the corporation’s name, by using false and forged documents. Corradini and Hackenberg also assisted their conspirators in obtaining over $135,000 in fraudulently obtained funds, and over $296,000 from a PPP loan that was obtained with false and forged documentation. That documentation included false information and certifications about CGM Realty LLC’s employee payroll obligations, and intention to use the funds for approved purposes, when in fact CGM Realty LLC had no employees or legitimate business operations. Forged IRS documentation also was included with the PPP application, containing false information about CGM Realty LLC’s nonexistent payroll obligations. Over $350,000 was then used to purchase Bitcoins, a type of cryptocurrency, with Corradini and Hackenberg obtaining several thousand dollars for their efforts.
As part of their guilty pleas, Corradini and Hackenberg agreed to forfeit several checks to investigators, and to pay over $430,000 in restitution.
“COVID-19 relief fraud is a high priority for the Department of Justice and our office will continue to vigorously investigate and prosecute these offenses,” stated Acting United States Attorney Bruce D. Brandler. “These funds were intended to help people and businesses harmed by the pandemic, not to line the pockets of fraudsters. We will do everything in our power to make sure that individuals involved in this type of criminal behavior are prosecuted to the fullest extent the law allows.”
The case was investigated by the IRS, Criminal Investigations Division. The case is being prosecuted by Assistant U.S. Attorney Phillip J. Caraballo.
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 more 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.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law for the offense is 10 years of imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Department of Justice
Office of the U.S. Attorney
Middle District of Pennsylvania