Man stole millions in COVID funds — then bought Tesla, hotel stays and more, feds say
A man pleaded guilty in connection with his elaborate plot to steal $31 million in COVID-19 relief funds meant to support struggling businesses and successfully stole more than $2.3 million, prosecutors in Washington, D.C., say.
He splurged with the money he managed to steal and bought a Tesla Model 3, hotel stays, ride shares, electronics and more, according to the U.S. Attorney’s Office for the District of Columbia. Additionally, he used the money to make his rent payments and pay for dog boarding and attorney fees, among other expenses, prosecutors said.
Elias Eldabbagh, 30, of Washington, D.C., pleaded guilty on April 8 after he was accused of using his company, Alias Systems LLC, to “fraudulently apply” for the millions in COVID-19 relief loans to benefit himself for nearly a year, the attorney’s office said in a news release.
Specifically, he illegally applied for at least 25 Paycheck Protection Program (PPP) loans, amounting to more than $30 million, and at least four fake Economic Injury Disaster Loans (EIDL) applications amounting to $950,000, the office said in the release. This took place from July 2020 until May 2021.
McClatchy News has contacted Eldabbagh’s attorney for comment.
“Eldabbagh used a stolen identity to disguise the ownership of (his company) and used the same stolen identity to submit the vast majority of the applications,” the attorney’s office said.
To support the fake applications, he “used stolen identities, stolen tax returns and stolen financial records from a Washington, D.C. consulting company,” the office added.
Then, he’d alter the stolen tax returns and financial records so that they’d appear to come from his company, according to prosecutors. As a result, he got $2,385,000 in stolen cash from PPP and EIDL loans, officials said.
Eldabbagh is also accused of wiring the stolen money to buy the Tesla and wiring the money into at least 13 bank and brokerage accounts, the attorney’s office said. At least $288,000 was converted into cryptocurrencies.
Eventually, he caught the attention of the Internal Revenue Service Criminal Investigation, and the agency “executed seizure warrants on Eldabbagh’s bank accounts and investment accounts” in May 2021, the news release said.
Eldabbagh ultimately entered a plea agreement and has agreed to give up the Tesla Model 3 and to empty 21 bank accounts to compensate the government for the money he stole, according to the attorney’s office. Additionally, “he has agreed to liquidate his interest in the cryptocurrency obtained with proceeds.”
He also agreed to surrender his dog Blake after he used the stolen loans to pay for the dog’s boarding expenses, according to a plea agreement obtained by McClatchy News.
A sentencing hearing is scheduled for Aug. 25, the news release said, and he potentially faces up to 14 years in prison.
“While many Americans were struggling with the economic impacts of the COVID-19 pandemic, this defendant brazenly attempted to steal more than $31 million in emergency funds intended to help small businesses and employees survive COVID-19,” U.S. Attorney Matthew M. Graves said in a statement.
This story was originally published April 12, 2022 at 10:09 AM with the headline "Man stole millions in COVID funds — then bought Tesla, hotel stays and more, feds say."
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