First person charged with Paycheck Protection Program fraud sentenced to federal prison
The first person in the country charged with fraudulently seeking pandemic business loans was sentenced to more than four years in federal prison, according to authorities.
David Adler Staveley, 54, of Andover, Massachusetts, faked his suicide to evade arrest after prosecutors said he tried to scam the government out of $543,000 in coronavirus relief funds.
Staveley and his co-conspirator David Andrew Butziger falsely claimed they owned four businesses, including three restaurants, according to a press release by the U.S. Attorney’s Office for the District of Rhode Island.
The two men applied for the Paycheck Protection Program through a Rhode Island bank and falsely claimed their businesses had "large monthly payrolls," officials said.
Staveley and Butziger sought more than $438,000 for the restaurants and just over $105,000 for another company called Dock Wireless.
"In fact, they did not own the businesses," prosecutors said.
Court documents state that police in Berlin, Massachusetts, were tipped off to the scheme by a person who said they had access to emails between Staveley and Butziger discussing the process of applying for the PPP loans.
The FBI was contacted, and federal investigators interviewed four people Butziger claimed were full-time employees at Dock Wireless. They all said they knew Butziger in their personal lives but had never worked for the company, according to the documents.
The restaurants were closed at the time Staveley and Butziger applied for the loans and remained closed.
The men were arrested in May 2020. Staveley and Butziger, 53, of Warwick, Rhode Island, were released to home detention with electronic monitoring. Federal authorities said about three weeks after being released, Staveley removed his device, faked his suicide and fled.
"Staveley left suicide notes with associates and left his wallet in his unlocked car that he parked along the ocean in Massachusetts," the press release stated. "Further investigation determined that between May 26 and July 23, 2020, Staveley ... traveled to various states using false identities and stolen license plates."
U.S. marshals eventually tracked him down and arrested him in Alpharetta, Georgia, in July 2020.
Following Staveley's release from prison, he will be under three years of federal supervised release. Butziger is scheduled to be sentenced next month. Attorneys for Staveley and Butziger did not immediately respond to a request for comment Friday.
CORRECTION (Oct. 8, 2021, 2:40 p.m. ET): A previous version of this article misstated the month in which David Adler Staveley was arrested by U.S. marshals. It was in July 2020, not June 2020.
