Locust Valley Businessman Sentenced In COVID Relief Fraud: US Attorney

OYSTER BAY, NY — Donald Finley, a Locust Valley businessman and owner of the Bayville Adventure Park and the defunct Jekyll & Hyde theme restaurant in Manhattan, was sentenced Tuesday to 24 months in prison for disaster relief fraud and wire fraud, U.S. Justice Department officials said.

“Finley viewed the deadly pandemic that was gripping the nation as a way to steal millions of dollars in COVID-19 relief funds that he used to purchase a vacation home in Nantucket,” said Breon Peace, United States Attorney for the Eastern District of New York. “Today the defendant learned the price to pay for such a shameful crime is a loss of his freedom and full restitution for the victims of his scam. Let this be a lesson to other lawbreakers who have engaged in similar conduct that this Office will not forgive and forget COVID-19 fraud.”

Finley pleaded guilty in May 2023 to the charges in connection with his receipt of $3.2 million dollars in small business loans under the Paycheck Protection Program and Economic Injury Disaster Loan Program. He initially faced up to 30 years in prison. SEE: Bayville Adventure Park Owner Pleads Guilty In COVID Scam

Between March 2020 and March 2021, at the height of the COVID-19 pandemic, Finley fraudulently applied for, and received, at least 29 PPP and EIDLP loans on behalf of corporate entities he controlled, prosecutors said. The applications contained false information, bogus financial data and fabricated supporting documentation, all of which was designed to fraudulently induce the SBA and the lenders administering the PPP and EIDL programs to approve the loans, prosecutors said.

Once the loans were approved, Finley sent the funds through more than 30 bank accounts to try to prevent tracing of the proceeds. Substantial portions were used to purchase the house on Nantucket, Massachusetts in February 2021, prosecutors said.

As part of the sentence handed down by United States District Judge Joan M. Azrack, the 61-year-old was also ordered to pay a $15,000 fine and complete 500 hours of community service. He has already paid $3.2 million in restitution, prosecutors said.

“Donald Finley is an admitted criminal, pleading guilty to pocketing millions in COVID-19 relief funds. While he was enjoying his spoils from his ill-gotten gains, many business owners with legitimate needs were just able to keep the doors open. Today’s sentencing means that no one was amused by this Bayville Adventure Park owner’s criminal acts, and he will now face time in prison,” Thomas Fattorusso, Special Agent-in-Charge, Internal Revenue Service Criminal Investigation New York, said.

Bayville Adventure Park operates as an entertainment park with rides like bumper boats and other amusements such as mini-golf in the summer. In the off-season, it hosts holiday-themed events like haunted houses in the fall and winter.

Congress created the PPP and EIDLP as part of the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act. Enacted on March 29, 2020, the CARES Act provided emergency financial assistance in connection with economic effects of the COVID-19 pandemic. The PPP program was overseen by the Small Business Administration and various financial institutions received and processed the PPP loan applications, which, if approved, would then be funded directly by the lenders and backed by the federal government.

One source of relief provided by the CARES Act was the allocation of funds for the issuance of forgivable loans to small businesses for job retention and certain other expenses through the PPP. The PPP allowed qualifying small businesses to receive unsecured loans on favorable terms, which they were required to use for specified expenses, including payroll costs, interest on mortgages, rent and utilities.

Another source of relief provided by the CARES Act was the EIDLP, which provided low-interest financing to small businesses, renters, and homeowners in regions affected by declared disasters. Under the program, EIDLP recipients were eligible to receive advances of up to $10,000 for small businesses within three days of applying for an EIDL Advance which did not have to be repaid.

“Postal Inspectors and our law enforcement partners are committed to fighting fraud in whatever form it takes, and we will pursue criminals from the busy streets of Manhattan to the shores of a quiet seaside village," Daniel B. Brubaker, Inspector-in-Charge, United States Postal Inspection Service, New York Division, said. "We want crooks to know that when you use the mail to defraud the public, justice will be served. Today’s sentencing is proof of that truth.”