UPDATE: Owners of Puro Trader Charged With $5MM CARES Act Fraud

This entry was originally published on 7/7/2022 and has been updated with new reporting.

*Updated 7/29*

According to reporting out today from the New Hampshire Business Review, Joshua Leavitt has plead guilty to one count of bank fraud and is seeking a plea agreement for a related wire fraud charge.

Based on what has been shared so far, Rogers does not appear to be a part of Leavitt’s plea agreement. There is no record of Rogers having plead guilty to any charges at this point.. The maximum prison sentence for the charge that Leavitt submitted a plea agreement for is 30 years, with the maximum fine topping out at $1,000,000, however NHRB Staff Reporter Bob Sanders writes that “the U.S. attorney’s office will recommend he be sentenced on the bottom of the sentencing guidelines in exchange for his cooperation on his own case, and presumably against Rogers, who has not plead guilty to any offense.”

Original 7/7 Entry:

The original press release is available to view on the Department of Justice website.

Pierre Rogers, 43, of Irvine, California, and Joshua Leavitt, 40, of Northwood, New Hampshire were indicted by a federal grand jury and charged with multiple counts of bank fraud, wire fraud, and attempted wire fraud, United States Attorney Jane E. Young and William A. Kalb, Special Agent in Charge of the U.S. Treasury Inspector General for Tax Administration, Northeast Field Division has announced.  Rogers was also charged with money laundering.

Leavitt was arrested and was released on conditions pending trial.  Rogers’s appearance was being secured at the time of the DOJ’s statement.

The indictment filed in court alleges that the defendants owned and operated at least seven companies, including Dark Matter Associates, Puro Trader (d/b/a Yayhn), Puro Group, and Puro Lounge.  During the early part of the coronavirus pandemic, Congress passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act.  The CARES Act included multiple relief provisions to help the millions of Americans and many small businesses adversely affected by the pandemic, including the Paycheck Protection Program (PPP).  Private lenders could participate in the PPP program.  The loans, which were supposed to be used for payroll, were fully guaranteed by the government.  If borrowers used the PPP loans for payroll and other approved expenses as intended, they could apply for loan forgiveness.  The CARES Act also opened up the Small Business Administration’s (SBA) Economic Injury Disaster Loan (EIDL) program.  As with PPP loans, EIDL loans were supposed to be used for payroll and other business expenses such as rent and mortgage.

In 2020 and 2021, Rogers and Leavitt applied for over two dozen PPP and EIDL loans for their companies.  The U.S. Attorney’s Office District of New Hampshire, in the orginal press release, allege that Rogers and Leavitt submitted false documents, including fabricated tax documents, which inflated their size and payroll.  Because PPP and EIDL loan size was tied to payroll and the number of employees a company had, the defendants were then able to apply for and obtain larger loans.  In total, the defendants applied for approximately $2 million in PPP loans and $3 million in EIDL funds.

The defendants are also alleged to have misused at least some of the loan proceeds.  For example, Rogers and Leavitt are said to have obtained a $175,000 PPP loan for Puro Group using fraudulent documents.  As charged in the indictment, Rogers used $107,780 of those funds to purchase a luxury vehicle, a Rolls Royce Ghost.

The charges in the indictment are only allegations.  The defendants are presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

The case was investigated by the Treasury Inspector General for Tax Administration and Secret Service, with assistance from the U.S. Postal Inspection Service.  It is being prosecuted by Special Assistant U.S. Attorney Alexander S. Chen.