Bethel Man Sentenced After Misusing Gov't COVID Funds: Feds

BETHEL, CT — A Bethel resident was one of three people sentenced Tuesday for fraudulently obtaining and misusing Paycheck Protection Program loans, according to a news release from the US Department of Justice.

PPP loans were issued by the U.S. Small Business Administration and guaranteed under the Coronavirus Aid, Relief, and Economic Security Act. The money was meant to help businesses keep their workforce employed during the COVID-19 crisis.

Eric J. O’Neil, 58, of Bethel, Khadijah X. Chapman, 59, of Atlanta, and Daniel C. Labrum, 42, of South Jordan, Utah, fraudulently obtained PPP loans for fictitious businesses in 2020 and 2021, as part of a "COVID-19 fraud ring," according to the DOJ.

O'Neill was sentenced to two years and three months in prison. Chapman and Labum were sentenced to three years, ten months; and two years, respectively.

"The defendants worked with co‑conspirators to falsify information and submitted fraudulent documents to financial institutions in Boise and elsewhere to collectively obtain approximately $3.5 million in relief funding intended for small businesses struggling with the economic impact of COVID-19," according to a statement issued by the DOJ Tuesday.

Labrum and O’Neil pleaded guilty in 2023 to bank fraud, and Chapman was convicted in November 2023 of bank fraud.