COVID Relief Fund Fraud, Feb. 23

PORTLAND, Ore.—After fleeing federal prosecution and being re-arrested, a former Lake Oswego, Oregon, man was sentenced to federal prison Tuesday, Feb. 22, for stealing funds intended to help small businesses during the COVID-19 pandemic. David Unitan, aka Daniel Cohen, 47, was sentenced to 61 months in federal prison and three years’ supervised release. Unitan took advantage of economic relief programs administered by the Small Business Administration (SBA) through Economic Injury Disaster Loans (EIDLs) and the Paycheck Protection Program (PPP), as authorized by the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The CARES Act, signed into law on March 27, 2020, was designed to provide emergency financial assistance to millions of Americans and small businesses suffering the economic effects of the COVID-19 pandemic. According to court documents, in July 2020, a small business owner contacted the Clackamas County Sheriff’s Office to report that an unknown person had obtained and used personal information belonging to himself, his wife, and their business to establish accounts at a bank in Boston. Sometime later, IRS Criminal Investigation independently opened an investigation into EIDLs and PPP loans obtained under suspicious circumstances by someone purporting to be Daniel Cohen and later confirmed to be Unitan. A review of SBA records revealed that six EIDL applications had been submitted using the small business owner’s social security number. Of the six applications, two were funded for a total of $295,000. These funds were disbursed into the Boston bank account in June and July of 2020. Investigators soon discovered that a transfer of $100,000 was made from the Boston account to another bank account on June 24, 2020, and that, on the same day, a wire transfer of $77,898 was made to Mackenzie Motor Company in Hillsboro, Oregon. Investigators contacted the general manager of Dick’s Mackenzie Ford in Hillsboro and learned that an individual named Daniel Cohen had recently purchased a 2020 Ford F-350 Super Duty Lariat truck for $77,898 using a counterfeit California driver’s license. The general manager also told investigators that the individual had shown up at the dealership driving a 2020 Tesla Model X and had provided his insurance card for the Tesla as part of the truck purchase. A review of law enforcement records revealed that the Tesla had recently been impounded by the Lake Oswego Police Department because Unitan had been operating the vehicle with a suspended license. Investigators compared Unitan’s Oregon DMV photo with the photo on the California driver’s license provided to dealership; the likenesses appeared to match. The small business owner who had originally reported the fraud later confirmed that his company had previously hired Unitan for video production services. The business owner also confirmed the photo on the counterfeit California driver’s license used to purchase the Ford pickup was indeed Unitan. On December 22, 2020, federal agents and Clackamas County Sheriff’s Office deputies arrested Unitan at his home on a federal criminal complaint charging him with wire fraud, aggravated identity theft, and money laundering. The federal agents also seized the Ford pickup and Tesla sedan, as well as digital evidence that would later confirm Unitan had applied for dozens of EIDL and PPP loans. After his arrest, Unitan appeared contrite and offered to assist the government in investigating other individuals defrauding COVID-relief programs. After his Pretrial Services officer discovered Unitan was spending money from an unauthorized account and asked to meet with him, Unitan fled. By January 29, 2021, Unitan had taken his girlfriend and her young child on what would be a seven-week run from law enforcement. On March 17, 2021, the U.S. Marshals Service located Unitan and his girlfriend in a Marysville, Washington hotel and arrested him without incident. On February 17, 2021, while Unitan remained a fugitive, a federal grand jury in Portland formally indicted Unitan on charges of wire fraud, aggravated identity theft, and money laundering. On October 29, 2021, he pleaded guilty to all three charges. U.S. Attorney Scott Erik Asphaug of the District of Oregon made the announcement. This case was investigated by the Clackamas County Sheriff’s Office, IRS Criminal Investigation, and the Small Business Administration Office of Inspector General. It was prosecuted by Ryan W. Bounds, Assistant U.S. Attorney for the District of Oregon. Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Justice Department’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.