Chandler Simbeck has been sentenced to 37 months in prison and three years of supervised release for conspiracy to defraud the United States, according to an announcement from the U.S. Attorney’s Office for the District of Colorado. He was also ordered to pay $151,000 in restitution.
Court documents show that between March and October 2020, Simbeck worked with Russell Foreman to submit fraudulent loan applications to the Small Business Administration (SBA) on behalf of himself and several businesses. The applications included false information.
In June 2020, Simbeck and Foreman established a limited liability company called Fusion Group and then applied for an Economic Injury Disaster Loan (EIDL) from the SBA. The application falsely stated when the company was established, its gross revenues, and its costs of goods sold. Fusion Group did not operate as a business or have any revenue or employees.
On August 27, 2020, the SBA approved their loan application and deposited $149,900 into a bank account controlled by Simbeck. In the following days, funds were withdrawn through various checks and transfers, including an $8,000 cashed check; two checks totaling $90,000 deposited into other accounts controlled by Simbeck; a $50,000 check made out to one of his relatives; and a $55,000 wire transfer sent to Foreman’s account.
Simbeck also received a $1,000 EIDL grant after submitting another false application in his own name in March 2020. Additionally, he attempted three times to secure Paycheck Protection Program (PPP) loans for two other businesses using applications with false information.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act was enacted in March 2020 to provide emergency financial assistance during the COVID-19 pandemic. Under this law, the SBA could issue loans such as EIDLs up to $150,000 for eligible expenses like payroll and fixed debts for businesses operating before February 1, 2020. The CARES Act also created PPP loans designed to help small businesses retain workers and cover certain expenses.
“Stealing from the taxpayers through COVID fraud is disgraceful as well as criminal,” said U.S. Attorney Cole Finegan. “We will prosecute those criminals who stole from hardworking business owners and employees.”
“Chandler Simbeck stole from individuals whose lives were upended by the pandemic, with no regard for the business owners and families the program was designed to support,” said Todd Martin, Special Agent in Charge at IRS Criminal Investigation Denver Field Office. “COVID fraud remains a top priority for CI and we will continue to work with our law enforcement partners and the U.S. Attorney’s Office to hold those accountable who abused the system for their personal benefit.”
United States District Court Judge Raymond Moore handed down Simbeck’s sentence on December 14, 2023. Russell Foreman had previously received a sentence of 66 months in prison along with supervised release and restitution.
The case was investigated by IRS Criminal Investigation and prosecuted by Assistant United States Attorney Robert Brown.
