A Barboursville, Kentucky man has been sentenced to five months in prison and five months of home detention for making false declarations during a bankruptcy proceeding. Ray Dean, 58, received the sentence from U.S. District Judge Robert Wier.
According to court documents, Dean applied for $200,000 through the Economic Injury Disaster Loan (EIDL) program on April 13, 2021. The EIDL program was established by the federal government to provide economic relief to small businesses affected by COVID-19 lockdowns. After his application was approved by the Small Business Administration (SBA), Dean agreed in writing that he would use the loan proceeds solely as working capital for his business.
After receiving the funds, Dean withdrew the money and deposited it into a bank account linked to a church where he served as pastor. He then used $92,000 of these funds to purchase mobile homes.
On June 20, 2024, Dean filed for bankruptcy and listed only one liability: the $200,000 EIDL loan. During this process, he was required to disclose all financial accounts but reported only two accounts with a combined balance of $105. He concealed both his interest in the mobile homes and another bank account that still contained over $100,000 from the EIDL proceeds.
Federal law requires that Dean serve at least 85 percent of his prison term. Following his release from prison, he will be supervised by the U.S. Probation Office for two years.
Paul McCaffrey, First Assistant United States Attorney for the Eastern District of Kentucky, and Lesley Allison, Special Agent in Charge with the United States Postal Inspection Service (USPIS) Pittsburgh Field Division jointly announced the sentencing.
The USPIS conducted the investigation. Assistant U.S. Attorney Andy Boone prosecuted the case on behalf of the United States.
"On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud," according to information provided by authorities. "The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts."
Further details about federal efforts related to pandemic response can be found at https://www.justice.gov/coronavirus.
Individuals who have information about suspected COVID-19 fraud are encouraged to report it via phone or online through resources provided by federal authorities at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
