Tri-Cities man used COVID money meant to save his business to buy an Airstream RV
A Kennewick business owner has agreed to pay $107,000 to resolve an accusation that he fraudulently used money from federal COVID-19 relief loans to buy an Airstream recreational vehicle for his family’s use.
Benjamin D. Castilla, owner of Columbia Basin Netwerks, took out a loan from the Paycheck Protection Program, a federal program that was intended to help small businesses retain jobs and maintain payroll during the COVID pandemic. Businesses could apply to have the loans forgiven, rather than pay them back.
Castilla also received money from the Economic Injury Disaster Loan program, which provided low-interest funding for businesses at risk during the pandemic.
Columbia Basin Netwerks in Kennewick provides computer services and support.
The Office of the Eastern Washington U.S. Attorney announced Friday that Castilla would repay the $107,000 he used to buy an RV.
He also will repay all of the money he was loaned through the Coronavirus Aid, Relief and Economic Security Act, or CARES Act, rather than have some of the loan forgiven.
Castilla’s first loan request was for $60,000 but the United States offered to increase that to $462,400, which Castilla had not requested, according to the settlement agreement.
After that Castilla sought and obtained $535,430 on behalf of his business between May 2020 and January 2021. Some of the money he was loaned was used for legitimate business purchases, according to the settlement agreement.
Applicants for Paycheck Protection Program loans are required to certify that all loaned money will be used only for business-related purposes specified in the loan application. Economic Injury Disaster Loans are required to be used solely as working capital to alleviate economic harm to businesses that were caused by the pandemic.
“COVID-19 relief programs quickly ran out of money due to the number of businesses that requested funding, meaning that struggling, deserving small businesses were not able to obtain critically needed funding to keep their businesses afloat during the shutdowns and disruptions caused by the COVID pandemic,” said U.S. Attorney Vanessa Waldref.
The civil settlement with Castilla was the result of the work by the Eastern Washington COVID-19 Strike Force launched last year by the U.S. Attorney’s Office. It has charged about 20 people and obtained 10 criminal felony fraud convictions.
In June, Jimia Rae Cain of West Richland was sentenced to a year and three months in federal prison for fraud related to COVID-19 loans she falsified documents to obtain for a business that was not active.
The former owners of HPM Corp. of Kennewick, Wash., a Hanford nuclear reservation site contractor, agreed to pay $2.9 million in restitution and penalties to resolve allegations of fraud related to a $1.3 million COVID-19 loan. The business has since been sold.
Assistant U.S. Attorneys Dan Fruchter and Tyler Tornabene prosecuted the Columbia Basin Netwerks case.
