Niles Man Sentenced For $1.5M Covid-Relief Fraud: Feds

CHICAGO — A Niles man has been sentenced to more than five years in federal prison for fraudulently obtaining more than $1.5 million in small business loans under the Coronavirus Aid, Relief, and Economic Security Act, or CARES Act. Earlier this month, Feroz Jalal, 51, was sentenced to five years and two months in prison and ordered to pay more than $1.5 million in restitution to the U.S. Small Business Administration.

Jalal pleaded guilty last year to bank fraud and money laundering charges.

According to prosecutors, Jalal participated in a scheme to defraud banks and the SBA. The agency's Paycheck Protection Program allowed qualifying small businesses to receive low-interest, government-backed loans to cover a temporary loss of revenue during the Covid pandemic.

As part of the scheme, authorities said Jalal submitted to lenders and the SBA at least a dozen applications for PPP loans on behalf of businesses that he and others purportedly owned. The applications contained false statements and misrepresentations concerning the purported entities' employees, revenues, costs, and statuses of operations. In support of his applications, Jalal provided, among other things, fake IRS tax filings and bogus spreadsheets that purported to document the companies' payroll expenses.

Jalal and co-schemers submitted fraudulent applications for PPP loans in amounts totaling $1.792 million, causing $1.644 million to be disbursed by lenders.

Anyone with information about attempted Covid-relief fraud can report it to the Department of Justice by calling the National Center for Disaster Fraud at 866-720-5721, or by filing an online complaint at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.