LOS ANGELES (KNX) — Two downtown Los Angeles residents were arrested on Friday in connection with a federal criminal complaint alleging they fraudulently took out more than $300,000 in COVID-19 relief loans for companies they claimed to own.
Prosecutors said they attempted to obtain an additional $1 million before they were stopped.
Sean Schoepflin, 42, also known as Sean Fitzgerald, and Erika Leon, 44, also known as Erika Fitzgerald, were each charged with one count of wire fraud. They will make initial appearances in L.A. federal court on Friday afternoon.
Prosecutors alleged that between 2020 and 2021, the defendants made numerous false statements to U.S. Small Business Administration officials in order to obtain Economic Injury Disaster Loans for their purported businesses — Capital Adventures Inc., Lady Capital Inc., and Lady Pictures LLP.
The pair falsely stated that the businesses they created employed several people and generated several hundred thousand dollars in revenues, prosecutors alleged. Shopeflin was also accused of falsely stating on loan applications that he had a clear criminal record, when he in fact had previously been convicted of “multiple felonies,” according to court filings.
The defendants’ purported businesses had no employees and generated little to know revenue. They used loans mainly for personal expenses, according to federal prosecutors.
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