The person involved requested the money to allegedly pay the payroll of two companies. Now he is accused of wire fraud, bank fraud, and illegal transactions.
A man, identified as Joshua Thomas Argires, went to prison in the USA after using nearly USD 1 million worth of government loans to buy Bitcoin and other cryptocurrencies. The involved Mr. Argires applied for financing twice through the Paycheck Protection Program (PPP) to allegedly meet the payroll of two companies in the USA after the stoppage due to the COVID-19 pandemic.
The Justice Department reported that Argires, who is 29 years old, received charges for false statements, wire fraud, bank fraud, and illegal monetary transactions.
The investigators stated that the suspect “executed a plan” to submit two applications for loans for USD 1.1 million at the agency for the Small Business Administration in Houston. The requirements were for the companies Texas Barbecue and Houston Landscaping.
The investigation began on suspicion about Argires’ application for Texas Barbecue. This included the payment, on average, of about USD 90 thousand for the 51 employees of the company. The indictment noted that such a high average salary for the operations of a barbecue business raises more suspicion.
According to the justice agency, Argires claimed that the companies had numerous employees and hundreds of thousands of US dollars in payroll expenses. However, the two entities either do not have employees or do not pay the payroll for the stipulated amount.
Regarding the destination of the money, the department highlighted that this man invested the funds that he received on behalf of Texas Barbecue in a cryptocurrency account. Besides, he kept the funds that he obtained for Houston Landscaping in a bank account, which he slowly depleted through ATM withdrawals.
The defendant could have sent USD 956,250 to an account on the exchange Coinbase through five bank transfers. He requested another USD 160,657 for Houston Landscaping, but Argires withdrew this amount via ATM.
According to the Justice Department, the money for Texas Barbecue remained in Coinbase’s account. The defendant made several purchases that generated profits, as this entity reported on July 16th.
The man was released from prison on bail after paying USD 25,000, while the investigations continue. It was not clear when the next hearings will be and the type of sentence that the defendant could pay.
The US government executes the Paycheck Protection Program through the Coronavirus Aid, Relief, and Economic Security (Cares) Act. The legislation allows small businesses to receive loans with a maturity of two years and an interest of 1%.
Contributions have also reached companies related to blockchain technology and cryptocurrencies. In recent days, the USA granted more than USD 18 million as a stimulus to around 40 companies in the ecosystem. Among them are CosenSys, Electric Coin Company (Zcash), Bittrex, Messari, and ShapeShift.
The United States is the country with the most COVID-19 cases reported and the one with the most deaths. In the North American country, there are more than 3.5 million people infected, while the number of deaths from the disease already exceeds 138,000.
By Alexander Salazar
