Arizona Man Pleads Guilty To Wire Fraud, Collecting COVID-19 Funds

Published: Tuesday, June 29, 2021 - 12:35pm
Updated: Wednesday, June 30, 2021 - 8:25am

An Arizona man pleaded guilty Monday to submitting dozens of false applications to get COVID-19 relief funds. Prosecutors say 56-year-old Michael Lain of Queen Creek collected $4 million before he was caught.

Between March and June 2020, prosecutors said Lain submitted fraudulent applications on behalf of more than 70 LLCs seeking loans and grants meant for small businesses hurt by the pandemic. The federal government says Lain made false statements about the number of employees, gross revenues and other financial data. He also falsely agreed to use the funds to support the businesses when prosecutors said he intended to use money for other things, including buying a new home.

The government said Lain’s LLCs received $3,830,400 in Economic Injury Disaster Loan proceeds and $336,000 in Economic Injury Disaster grant proceeds. As part of a plea deal, Lain agreed to pay restitution and replay $294,900 he received from submitting fraudulent Paycheck Protection Program applications. 

“Anyone who uses lies and deceit to defraud the generosity of the American taxpayer can expect to find the U.S. Attorney’s Office and its law enforcement partners standing guard,” Deputy U.S. Attorney J. Chris Larson said in a news release. “Taxpayers want these funds to be used as intended — to save businesses hit hard by the pandemic, not to line the pockets of criminals.”

A sentencing hearing is scheduled for Dec. 3.