Bed-Stuy Man Who Scammed $2M From Pandemic Relief Fund Gets 6 Yrs: DOJ

BED-STUY, BROOKLYN — A Bed-Stuy man who scammed nearly $2 million from the federal government's coronavirus business relief fund will spend six years in prison for the scheme, according to prosecutors.

Leon Miles, 53, was sentenced to six years in prison on Tuesday after pleading guilty to faking an application for the Paycheck Protection Program (PPP), which Congress created as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act in 2020, according to the U.S. Attorney’s Office.

“Leon Miles selfishly enriched himself by defrauding a program designed to alleviate the economic suffering caused by the COVID-19 pandemic,” United States Attorney Breon Peace said. “The defendant stole nearly $2 million dollars that was intended to keep struggling businesses afloat and honest workers employed, and he spent those funds on personal luxuries."

As part of the sentencing, Miles was ordered to turn over more than $1.9 million he scammed from the fund, including a 2020 Bentley he bought with the money, prosectors said. He will also pay nearly $600,000 in restitution, according to officials.

An attorney for Miles told Patch all but $276,068 of the $1.9 million has been repaid.

"Mr. Miles accepted responsibility and made substantial efforts to right his wrong," the attorney, Todd A. Spodek, said. "Based on our calculations, out of the $1,904.593 which was received, only $276,068.10 is outstanding."

Miles — who pleaded guilty to making false statements on the PPP application — claimed that he ran a company with 50 employees out of his home on Macon Street, prosecutors said. His application for $1.9 million was approved in May 2020.

The CARES Act provides emergency financial assistance to those suffering because of the coronavirus pandemic, including forgivable loans to small businesses for job retention and other expenses.

But investigators later discovered that all the tax forms Miles had sent in with the PPP application — claiming he spent more than $761,000 a month on payroll — were fake, and had never been filed with the Internal Revenue Service, according to the court records.

The company had actually filed no tax returns and Miles reported no taxable income during the time period on the fake documents, prosecutors said.

Instead, within days of getting the PPP loan money put in his personal savings account, Miles took out hundreds of thousands of dollars. He used the money to buy the $250,000 Bentley Continental and $100,000 Cadillac Escalade, prosecutors said.