Business loan

Man Sentenced in COVID-19 Relief Business Loan Fraud


A man who faked suicide and fled to avoid prosecution for fraudulently seeking hundreds of thousands of dollars in coronavirus pandemic relief loans for struggling small businesses was sentenced Thursday to nearly five years in prison.

David Staveley, 54, of Andover, Mass., And an accomplice were the first people in the country accused of fraudulently applying for Paycheck Protection Program loans when they were first charged in May 2020, the Rhode Island U.S. Attorney’s Office said in a statement.

Staveley – who is also called Kurt David Sanborn or David Sanborn – and David Andrew Butziger, 53, of Warwick, Rhode Island, filed four fraudulent loan applications with a Rhode Island bank, claiming they owned companies with a large monthly payroll, prosecutors said.

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Together, they applied for nearly $ 550,000 in loans for two restaurants in Warwick, Rhode Island, and a third restaurant in Berlin, Massachusetts, as well as a wireless phone company.

Staveley had no stake in the restaurants, which were closed at the time the loan applications were submitted, prosecutors said. The wireless company had no employees and no wages were ever paid by the company, prosecutors said.

Staveley initially pleaded not guilty in May 2020 and was taken into house arrest, but removed his GPS monitor and fled, according to a previous statement from the US Marshals Service.

His vehicle was found near a beach in Quincy, Massachusetts, unlocked with the key in the ignition and his wallet, credit cards and driver’s license inside. He also told his associates he was going to kill himself, authorities said.

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But no evidence was found that he had committed suicide, and the marshals concluded that Staveley had faked his death.

Using false identities and stolen license plates, he visited several states before authorities caught up with him in Alpharetta, Georgia on July 23, 2020, prosecutors said.

At the time of his arrest, he had several pieces of identification with different names, authorities said.

Staveley pleaded guilty in May 2021 to conspiring to commit bank fraud and not appearing in court.

Butziger, who pleaded guilty in September 2020 to conspiring to commit bank fraud, is expected to be sentenced on November 1.