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- Jedrek Upton pleaded guilty to wire fraud and money laundering in loan fraud.
- Prosecutors said Upton used the money to support his “lavish lifestyle.”
- A federal judge sentenced Upton to one year prison and three years of parole.
A Placer County business owner was sentenced on Tuesday in federal court for using nearly $1.5 million in COVID-relief loans to pay off his personal credit card debt, lease a Ferrari and a Lamborghini and make a down payment on a $2.7 million property.
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U.S. District Judge John A. Mendez sentenced Jedrek Upton, 45, of Lincoln, to one year in prison and three years of parole, which includes 12 months that must be spent in home detention, the U.S. Attorney’s Office in Sacramento announced in a news release.
In November, Upton pleaded guilty to one count of wire fraud and one count of money laundering in the COVID-relief loan fraud scheme, according to IRS Criminal Investigation, which conducted the investigation that led to the federal charges against Upton.
Federal prosecutors said Upton repeatedly submitted fraudulent applications for COVID‑19 disaster relief from January 2021 through May 2022 on behalf of businesses he owned, using the money “to support a lavish lifestyle.”
He falsely inflated the number of employees on payrolls and misrepresented how the funds would be used, claiming he would spend the money to alleviate economic harm caused by the pandemic, according to the U.S. Attorney’s Office. Upton also submitted falsified IRS documents to support the applications.
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Prosecutors said several of Upton’s businesses had no employees and no payroll, and Upton spent much of the relief money on personal expenses. A large portion of the loans was ultimately forgiven after Upton falsely certified that the money was used for payroll and legitimate business expenses.
Instead, Upton used the money to pay off personal credit card debt, transfer money to others, lease a Ferrari and a Lamborghini and make a large down payment on a 10-acre property worth $2.7 million, prosecutors said.
As part of his sentence, Upton forfeited his interest in the property, and he was ordered to pay nearly $1.5 million in restitution to the federal government.
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