Real estate developer Michael James DeFrees has been sentenced to 21 months in federal prison for fraudulently obtaining coronavirus relief funds and laundering the proceeds. DeFrees used two business entities to obtain Economic Injury Disaster Loans and Paycheck Protection Program loans from the U.S. Small Business Administration (SBA) under false pretenses. He submitted multiple loan applications, falsely claiming to be the sole owner of the businesses and concealing his previous felony conviction. DeFrees laundered some of the money and used it for personal expenses. The SBA estimated that over $200 billion in potentially fraudulent pandemic relief funds have been disbursed. The SBA is prioritizing fraud prevention and working on improving data-sharing to verify applicant information.
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