Man charged with pandemic relief loan fraud pleads guilty
PROVIDENCE, R.I. (AP) — A Rhode Island man charged with fraudulently seeking hundreds of thousands of dollars in forgivable federal loans designed for businesses struggling because of the coronavirus pandemic has pleaded guilty, federal authorities said Friday.
David Andrew Butziger, 52, of Warwick, was one of two men charged in May with seeking loans needed to pay employees at businesses affected by the virus crisis, when in reality the businesses were not operating before the pandemic began and had no employees, according to a statement from the U.S. Attorney for Rhode Island, Aaron Weisman.
They were the first people in the U.S. to be charged with making phony applications for loans under the Paycheck Protection Program, officials said at the time of their arrest.
Butziger pleaded guilty Friday in federal court in Providence to conspiracy to commit bank fraud. Sentencing is scheduled for Dec. 18.
A message was left with his attorney.
Butziger submitted a loan application for more than $100,000 through a Rhode Island bank on behalf of a company he called Dock Wireless, prosecutors said.
The application indicated that Dock Wireless had seven employees and an average monthly payroll of more than $42,000, prosecutors said. In truth, Dock Wireless had no employees and no wages were ever paid out by the company, authorities said.
Butziger also conspired with the other man, who sought hundreds of thousands of dollars in loans to pay employees at three restaurants he said he owned. Two of the restaurants were not open prior to the pandemic and he had no ownership stake in the third, prosecutors said.
The other man, David A. Staveley, who also goes by Kurt Sanborn, of Andover, Massachusetts, is awaiting trial. His attorney has not commented.