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Cryptocurrency company owner charged with COVID-19 program fraud

According to the indictment, Corona inflated HODL LLC’s payroll and misrepresented his business’s number of employees in the PPP loan applications.
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DALLAS — A Dallas man who allegedly devised a scheme to defraud a pandemic-era financial program out of hundreds of thousands of dollars has been federally charged, according to U.S. Attorney for the Northern District of Texas Chad E. Meacham.

John Corbin Corona, 35, was indicted Saturday on one count of wire fraud and one count of money laundering. He was arrested Monday and made his initial appearance before U.S. Magistrate Judge Toliver Wednesday.

“As millions of small business owners grappled with the fallout from the pandemic, this defendant raked in a couple hundred thousand bucks at his fellow citizens’ expense,” Meacham said. “The Paycheck Protection Program, funded by taxpayers, was designed to help small businesses stay afloat during the pandemic. The Justice Department will relentlessly pursue those who defrauded the PPP.”

According to the indictment, Corona is the owner of HODL LLC, a cryptocurrency company operating a purported bitcoin pooled investment fund known as Bitcoin Bank America. Corona allegedly applied fraudulently for two Paycheck Protection Program (PPP) loans totaling more than $413,000 through BlueVine Inc. and FundBox, Inc., financial technology companies that partnered with third-party PPP lenders, including Celtic Bank.

Corona inflated HODL LLC’s payroll and misrepresented his business’s number of employees in the PPP loan applications that he submitted to BlueVine and Fundbox, the indictment said. In support of the PPP loan applications, he also submitted IRS Form 941s (Employer’s Quarterly Federal Tax Return) that allegedly contained false information about his business.

The indictment also alleges that after Celtic Bank deposited $206,902 in PPP loan proceeds into Mr. Corona’s bank account, Mr. Corona transferred over $155,000 in PPP loan funds to Coinbase Inc., a cryptocurrency exchange platform.

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An indictment is an allegation of criminal conduct and not evidence. Like all defendants, Meacham said Corona is presumed innocent until proven guilty in a court of law.

If convicted, Corona faces up to 20 years in federal prison on the count of wire fraud and 10 years on the money laundering count. Upon conviction, Corona will be required to forfeit money made from the scheme or property traceable to it.

The FBI’s Wichita Falls and Dallas field offices conducted the investigation. Assistant U.S. Attorney Fabio Leonardi is prosecuting the case.

The PPP was authorized under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which was a federal law enacted on March 29, 2020, to provide emergency financial assistance to Americans suffering economic hardship due to the COVID-19 pandemic. 

The PPP provided forgivable loans to small businesses to cover payroll, rent, and other certain expenses.

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