A Barboursville, Kentucky man has been sentenced to five months in prison and five months of home detention for making false declarations during a bankruptcy proceeding. Ray Dean, 58, received the sentence from U.S. District Judge Robert Wier.
According to court documents, Dean applied for $200,000 under the Economic Injury Disaster Loan (EIDL) program on April 13, 2021. The EIDL program was created by the federal government to provide economic relief to small businesses affected by COVID-19 lockdowns. After his application was approved by the Small Business Administration (SBA), Dean agreed to use the funds solely as working capital for his business.
However, after receiving the loan, Dean withdrew the money and deposited it into a bank account linked to a church where he served as pastor. He then used $92,000 of these funds to purchase mobile homes.
On June 20, 2024, Dean filed for bankruptcy and listed only the $200,000 EIDL loan as his liability. As part of this filing, he was required to disclose all financial accounts but reported only two accounts with a combined balance of $105. He did not disclose his interest in the mobile homes or another bank account that still held over $100,000 from the EIDL proceeds.
Under federal law, Dean is required to serve at least 85 percent of his prison term. Following his release from prison, he will be supervised by the U.S. Probation Office for two years.
Paul McCaffrey, First Assistant United States Attorney for the Eastern District of Kentucky, and Lesley Allison, Special Agent in Charge of the United States Postal Inspection Service (USPIS) Pittsburgh Field Division announced the sentencing.
“The investigation was conducted by USPIS. Assistant U.S. Attorney Andy Boone prosecuted the sentencing on behalf of the United States.”
The Department of Justice established the COVID-19 Fraud Enforcement Task Force in May 2021 to coordinate efforts across agencies in combating pandemic-related fraud. The task force aims to investigate and prosecute major offenders and support agencies administering relief programs through enhanced coordination and information sharing. More details about these efforts can be found at https://www.justice.gov/coronavirus.
Reports of attempted COVID-19 fraud can be made through the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via their online complaint form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
