Company Accused of Using COVID Relief Funds to Buy Crypto

The owner of the Carolina Fish Market in Ballantyne, North Carolina is in trouble for using a COVID-based loan to purchase cryptocurrency. James Seidel has been accused of defrauding the Small Business Administration (SBA) using Economic Injury Disaster Loan funds.

COVID Fraud Became Rather Prominent

The COVID pandemic of 2020 and 2021 brought about a huge string of disasters. The economy tanked, people were out of work, and many businesses were forced to either close altogether or make serious cuts, not to mention all the deaths that occurred. It was an ugly and disastrous time for many business owners that no doubt many of them prefer not to remember, much less reflect on.

Many government agencies and programs were brought about as a means of delivering relief to those that were suffering. PPP loans, for example, were created to help companies keep their staff members in place and ensure they had the money they needed to pay their employees what they were worth.

Unfortunately, while there were many businesses that were honest and fair about what they were going through, there were several others that used the situation to engage in fraud and either obtain money that wasn’t rightfully theirs or lie to get money that was then used for illicit purposes.

The Carolina Fish Market was one of the companies that allegedly chose the latter route according to recent court documents. Dena King – the U.S. attorney for the western district of North Carolina – explained in a recent interview:

Anytime there’s a large amount of money available to people, there is going to be a segment of people that look for the opportunity to enrich themselves.

King says her office is regularly engaging in cases that involve COVID loan fraud. Last June, for example, it was reported by the SBA that as much as $200 billion offered by the office had wound up in the hands of illicit actors. That’s nearly 20 percent of what was doled out. King continued with:

There are people who did not even have legitimate businesses up until the pandemic.

Some Serious Crimes in the Mix

She also mentioned that while some cases are cut and dry, others show apparent evidence of business owners trying to use loans to cover other fraud. Red flags in these instances include fudging numbers regarding how many employees they have and how much business these companies had brought in. King concluded with:

There were also a number of people that touted themselves as preparers, so people could actually go to consultants or preparers who would fill out these applications on their behalf including a [lot] of fraudulent information to be able to help the individuals to obtain these loans, but then also these consultants, so to speak, were able to get a percentage of that.