The Sedona man and other defendants are accused of filing fraudulent claims for the government's Paycheck Protection Program.
SEDONA, Ariz. — A Sedona man has been indicted for his alleged role in a scheme to defraud the federal government out of $178 million.
Eric Karnezis, 43, is facing fraud charges for allegedly operating a scheme to obtain loans through the Paycheck Protection Program, which was implemented during the COVID-19 pandemic. U.S. Attorney's Office for the District of Oregon.
Karnezis and his associates allegedly submitted 1,300 PPP applications to the U.S. Small Business Administration for a total of $178 million in loans, with approximately $105 million disbursed in loans for those fraudulent applications.
According to prosecutors, the defendants allegedly used false payroll information and tax documents to submit PPP applications.
The federal program was designed to provide financial assistance to businesses that suffered economic harm during the pandemic shutdowns, and several people, including an Arizona man, have been convicted of defrauding the program.
Karnezis was arrested in Sedona on Sept. 5 and pleaded not guilty during his initial appearance in federal court. The other defendants in the case have been identified as Linisha Wells, 47, Nikkia Bennett, 43, and Frederico Williams, 48, all of California.
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