A Baltimore County businessman has been sentenced to federal prison after admitting to fraudulently securing over $1.3 million in COVID-19 relief loans and misusing the funds for personal luxury expenses. David Epstein, 46, of Owings Mills, Maryland, was sentenced to one year and one day in prison followed by a year of home incarceration for wire fraud involving the CARES Act Paycheck Protection Program (PPP). The sentencing was announced by the U.S. Attorney’s Office for the District of Maryland.
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Between May 2020 and February 2021, Epstein submitted false loan applications under the names of his businesses PEI Staffing and Stafquik, inflating employee counts and providing misleading financial information to secure funds from the PPP and Economic Injury Disaster Loan (EIDL) programs. The fraudulent applications were sent to several financial institutions including Cross River Bank, Bluevine, Celtic Bank, and the Small Business Administration (SBA). A single PPP application on April 30, 2020, requested $1,307,170 based on incorrect data about staffing and payroll.
After receiving the funds on May 4, 2020, Epstein transferred the money into personal accounts at two banks and quickly spent it on various personal expenditures. Within days, he made a six-figure payment to Mercedes-Benz Financial for a luxury vehicle, directed over $138,000 to a contractor for home renovations including a swimming pool, and used remaining funds to settle personal debts, including a $100,000 legal settlement and $344,000 owed to a business partner.
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Prosecutors also revealed that Epstein attempted to cover up the fraud by placing creditors on his business’s payroll to appear as legitimate employees. He concealed the loan amount from business associates, family, and employees. The case was investigated by the IRS Criminal Investigation unit and prosecuted as part of the District of Maryland’s COVID-19 Fraud Strike Force, one of several units across the country focused on pandemic-related financial crimes.
Article by multiple RFHC contributors, based upon information from the U.S. Attorney’s Office, District of Maryland
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