Manhattan District Attorney’s Office: D.A. Vance: Investment Manager Charged For Multimillion-Dollar “PPP” Loan Scam

April 16, 2021

Manhattan District Lawyer Cy Vance, Jr., at this time introduced the Prison Court docket arraignment of New York Metropolis-based funding supervisor GREGORY BLOTNICK, 33, for stealing greater than $2.Four million from a number of lending establishments by means of Paycheck Safety Program (“PPP”) mortgage purposes between April 2020 and August 2020. BLOTNICK is charged in a New York County Prison Court docket criticism with a number of counts of Grand Larceny within the Second Diploma and Prison Possession of Stolen Property within the Second Diploma, and one rely of Scheme to Defraud within the First Diploma.

“As alleged, Mr. Blotnick repeatedly took benefit of a system meant to supply lifelines to small companies and their workers through the peak of the COVID-19 pandemic,” mentioned District Lawyer Vance. “At a time when almost 3,000 companies have been compelled to shut their doorways throughout New York Metropolis, Mr. Blotnick diverted tens of millions in very important PPP funds for his personal private achieve. Our Workplace is dedicated to holding accountable anybody who criminally abuses the crucial packages New Yorkers are counting on to get by means of disaster. If you already know somebody who has dedicated any such fraud, we urge you to name us at (212) 335-8900.”

Based on the criticism and statements made in court docket, starting in April 2020, BLOTNICK utilized for PPP loans at 5 lending establishments, misrepresenting the variety of workers at every of his varied corporations and falsely certifying that the mortgage proceeds could be used to cowl related payroll prices. Based mostly on these misrepresentations, BLOTNICK was awarded roughly $2.Four million in PPP mortgage proceeds. Opposite to BLOTNICK’s misrepresentations, monetary and different data reveal that slightly than getting used to fund payroll for any workers, BLOTNICK diverted the overwhelming majority of the PPP mortgage proceeds to his private buying and selling accounts and subsequently misplaced them in buying and selling exercise.

On April 30, 2020 BLOTNICK submitted a PPP mortgage software for Brattle Avenue GP LLC to Cross River Financial institution asserting and certifying that PPP mortgage proceeds could be used for Brattle Avenue GP LLC’s payroll. He additionally asserted that Brattle Avenue GP LLC had 25 workers on a mean month-to-month payroll of $196,440. BLOTNICK requested a PPP mortgage within the quantity of $491,100, which was then awarded by Cross River Financial institution and deposited right into a Brattle Avenue GP LLC Chase enterprise account. BLOTNICK then wired roughly $250,000 from Brattle Avenue GP’s Chase enterprise account to one among his personal Interactive Dealer buying and selling accounts. He then wired roughly $200,000 to a person recognized as a earlier investor of BLOTNICK’s funding administration agency.

On Could 9, 2020, BLOTNICK submitted a PPP mortgage software for Brattle Avenue Capital LLC to TransPecos Financial institution. He asserted and authorized that PPP mortgage proceeds could be used for Battle Avenue Capital LLC’s month-to-month common payroll of $154,840. BLOTNICK requested a PPP mortgage of $387,100, which was then awarded by TransPecos financial institution and deposited right into a Brattle Avenue Capital LLC Chase enterprise account on Could 13, 2020. He then wired roughly $275,000 from Brattle Avenue Capital LLC’s Chase enterprise account to his Interactive Dealer buying and selling accounts and wired roughly $104,165 to pay a web-based invoice.

Between Could 13 and Could 15 2020, BLOTNICK bought roughly $244,301 in securities by means of his Interactive Dealer buying and selling accounts.

Additionally in Could, BLOTNICK submitted a PPP mortgage software for BSC Administration LLC to Northeast Financial institution. He asserted and authorized that PPP mortgage proceeds could be used for BSC Administration LLC’s payroll. BLOTNICK additionally asserted that BSC Administration LLC had 26 workers on payroll, with a month-to-month common of $182,339. He requested a PPP mortgage within the quantity of $455,800, which was then awarded and deposited into Brattle Avenue Capital LLC’s First Republic Checking account. BLOTNICK wired roughly $440,000 from the Brattle Avenue Capital LLC First Republic Checking account to 2 of his Interactive Dealer buying and selling accounts. Roughly $15,000 was then wired to BLOTNICK’s private account at Wells Fargo Financial institution. On Could 29, 2020, BLOTNICK bought roughly $265,580 in securities by means of his Interactive Dealer buying and selling accounts. 

On June 4, 2020, BLOTNICK submitted a PPP mortgage software for Brattle Avenue Capital LLC to American Specific Nationwide Financial institution. BLOTNICK asserted and authorized that PPP mortgage proceeds could be used for Brattle Avenue Capital LLC’s payroll, which he asserted was a mean month-to-month payroll of $326,995 for 45 workers. He requested a PPP mortgage of $817,487.50, which was then awarded by American Specific Nationwide Financial institution and deposited into Brattle Avenue Capital LLC’s First Republic Checking account on June 12, 2020. BLOTNICK then transferred roughly $816,000 to a few of his Interactive Dealer buying and selling accounts and thereafter bought roughly $686,542 in securities.

Lastly, on August 4, 2020, BLOTNICK submitted a PPP mortgage software for Brattle Avenue GP LLC to Ponce Financial institution, asserting and certifying that PPP mortgage proceeds could be used for Brattle Avenue GP LLC’s payroll. BLOTNICK asserted that Brattle Avenue GP LLC had 16 workers on a mean month-to-month payroll of $135,253. BLOTNICK requested a PPP mortgage within the quantity of $338,132, which was awarded by Ponce Financial institution and deposited into BLOTNICK’s Ponce Checking account within the identify of Brattle Avenue GP LLC. BLOTNICK then wired roughly $325,000 from his Ponce Checking account to the Brattle Avenue Capital LLC’s First Republic Checking account. He then wired roughly $225,000 of these funds to his Interactive Dealer buying and selling accounts.

Assistant D.A.s Daniel Poulos, Gabriel Hippolyte, and Bonnie Seok are dealing with the prosecution of the case below the supervision of Assistant D.A.s Steve Pilnyak, Principal Deputy of the Main Financial Crimes Bureau, and Julieta V. Lozano, Chief of the Main Financial Crimes Bureau, and Gloria Garcia, Deputy Chief of the Investigation Division and Govt Assistant D.A. Christopher Conroy, Chief of the Investigation Division. Senior Monetary Investigator Joseph Dunn, Monetary Intelligence Analyst David Cole, and Paralegals Benjamin Kobrin and Anna Kuritzkes offered evaluation and help within the investigation. Senior Investigator Louis Capolupo and Investigator Rachel Dragos additionally assisted within the matter.

D.A. Vance thanked the Palm Seaside County State Lawyer’s Workplace, and specifically Assistant State Lawyer Greg Kridos, and the West Palm Seaside Police Division, particularly Detective Fernando Palacios, for the help and assist they’ve supplied with the investigation.

 

Defendant Data

GREGORY BLOTNICK

WEST PALM BEACH, FL

Prices:

• Grand Larceny within the Second Diploma, a category C felony, 5 counts
• Prison Possession of Stolen Property within the Second Diploma, a category C felony, 5 counts
• Scheme to Defraud within the First Diploma, a category E felony, one rely

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This press launch was produced by the Manhattan District Attorney’s Office. The views expressed listed below are the writer’s personal.

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