They flashed cash from COVID fraud on Instagram, feds say. NC judge sends 3 to prison
Three men accused of plotting to get $2.7 million worth of fraudulent COVID-19 relief loans at the onset of the coronavirus pandemic have been sentenced to prison in North Carolina.
A federal judge in the Middle District of North Carolina sentenced 30-year-old Joseph Marsell Cartlidge and 32-year-old David Christopher Redfern, both from North Carolina, to six years and five years in prison, respectively, on Feb. 14. Eric Alexander McMiller, 30, of Chicago, was sentenced to five and a half years.
The trio pleaded guilty to various counts of wire and bank fraud last year.
Defense attorneys representing them did not immediately respond to McClatchy News’ request for comment on Feb. 16.
According to documents filed with their plea agreements, the alleged fraud dates to the early months of the COVID-19 pandemic — shortly after Congress passed the Coronavirus Aid, Relief, and Economic Security Act in March 2020 to stave off an economic downturn.
The package included billions of dollars in forgivable loans for small businesses known as the Paycheck Protection Program, or PPP, and an expansion of the Economic Injury Disaster Loan, or EIDL, program.
Cartlidge, Redfern and McMiller were recruited in May 2020 by a confidential source to submit fake applications for both programs, prosecutors said. In exchange for preparing the fake documents that accompanied their applications, the source reportedly took a cut of the money they received from the federal government.
According to court documents, Cartlidge submitted two fake PPP loan applications: one worth $403,120 on behalf of a company that was registered to an incarcerated individual and a second for $463,530 on behalf of a company registered in his own name.
After the government disbursed the money into bank accounts he controlled, prosecutors said Cartlidge withdrew $454,000 in cash and cashier’s checks over roughly two weeks in June 2020. According to the indictment, he then spent:
▪ $649 at Louis Vuitton
▪ $979 at Nieman Marcus
▪ $1,526 at Gucci
▪ $2,350 at the boat and yacht rental company “Get My Boat”
Prosecutors said the purchases were all made with a debit card at the end of June 2020. Investigators obtained records from Instagram over the same time period and saw that Cartlidge and McMiller had tagged each other in multiple pictures and stories.
“These photographs and videos show Cartlidge and McMiller with large amounts of cash and/or making luxury purchases,” the government said.
Cartlidge is also accused of filing fake applications for an EIDL on behalf of his company. Two of the attempts failed, prosecutors said, but he ultimately succeeded in receiving $10,000 in EIDL advance funds.
Redfern and McMiller reportedly followed the same playbook.
In June 2020, Redfern submitted a bogus PPP application for $410,322 on behalf of his business, Wilder Effects LLC, the government said. He also sought at least two EIDLs in April and May the same year and received $4,000 in advance funds from the Small Business Administration as a result, according to court filings.
McMiller similarly submitted one fake application for a PPP loan in the name of his company, McMiller Enterprises LLC — but it was denied, prosecutors said. He reportedly later tried to deposit a check at a bank in High Point for $250,000 that was drawn from an account in Cartlidge’s name.
According to court filings, McMiller also submitted three bogus EIDL applications and received $20,000 in advance funds before they were denied.
The trio ultimately sought more than $2.7 million in fraudulent PPP loans and EIDL funds, prosecutors said.
Redfern was the first to face federal charges after prosecutors filed a criminal complaint against him in the Middle District of North Carolina in August 2020. A superseding and second superseding indictment that included Cartlidge and McMiller as defendants followed.
Cartlidge pleaded guilty first in August 2021, court documents show, and Redfern and McMiller followed suit in September.
As part of their sentencing, prosecutors said, the trio will each have to pay $498,657 in restitution.
This story was originally published February 16, 2022 at 5:59 PM with the headline "They flashed cash from COVID fraud on Instagram, feds say. NC judge sends 3 to prison."
