LAS VEGAS (KLAS) — A man from Los Angeles was ordered to be held without bond Thursday afternoon after being arrested on federal charges alleging he fraudulently obtained millions of dollars in Paycheck Protection Program (PPP) loans, some of which he used on gambling excursions to Las Vegas and transferred to his stock trading accounts.
Andrew Marnell, 40, was arrested Thursday morning by federal authorities. Marnell made his initial court appearance that afternoon in United States District Court in Los Angeles, where he was ordered detained pending a hearing that is scheduled for Tuesday.
A criminal complaint unsealed in court Thursday afternoon charges Marnell with one count of bank fraud and alleges he obtained more than $8 million in PPP loans through applications to insured financial institutions, and others, on behalf of different companies.
During the court hearing, prosecutors said they now believe Marnell received approximately $9 million in fraudulent loans – a number that could rise as the investigation continues.
The affidavit in support of the complaint alleges that Marnell submitted fraudulent loan applications that made numerous false and misleading statements about the companies’ business operations and payroll expenses. The affidavit also alleges that Marnell, often using aliases, submitted fake and altered documents, including bogus federal tax filings and employee payroll records.
The complaint further alleges that Marnell then transferred millions of dollars from the fraudulently obtained loan proceeds to his brokerage accounts to make risky stock market bets. The affidavit also outlines how Marnell allegedly spent hundreds of thousands of fraudulent money at the Bellagio Hotel & Casino and other gambling establishments as recently as last weekend.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act was designed to provide emergency financial assistance to millions of Americans who are suffering the economic effects resulting from the COVID-19 pandemic. One source of relief provided by the CARES Act is the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses through the PPP. In April, Congress authorized more than $300 billion in additional PPP funding.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.