A Cattaraugus County man with prior felony fraud convictions as well as an Oklahoma woman have been charged with bank fraud and other crimes in connection with what federal prosecutors call a scheme to illegally obtain nearly $1 million through the federal government's Covid-19 relief Paycheck Protection Program.
According to federal officials, Adam D. Arena, 44, of Great Valley, used some of the unlawfully acquired PPP loan money to purchase two automobiles, while Amanda J. Gloria, 44, of Altus, Okla., spent $43,000 on personal items such as spa services, clothes, restaurant meals, and gym memberships. Arena was convicted earlier this year in Suffolk County for his involvement in an intricate countrywide phony identity scam that cost banks and credit unions over $1 million. According to court documents, Arena and Gloria plotted to get a $954,000 loan through a defunct firm and then spend the money on personal costs in the PPP case.
According to a criminal complaint filed in U.S. District Court for the Western District of New York, Arena contacted Gloria on July 27, 2020, with five papers purporting to be federal tax returns from 2019 for ADA Auto Group, a Florida-based company. ADA Auto Group, on the other hand, remained dormant from 2018 until May 2020, according to the lawsuit.
Gloria emailed a PPP loan application to a bank the same day, asking a $954,000 loan for ADA Auto Group. She included the tax returns and certified that ADA Auto Group was in existence on February 15, 2020, and that the loan will be utilized for business-related activities. According to court records, Gloria submitted further tax forms and payroll forms on behalf of ADA Auto Group less than two weeks later, including paperwork stating the firm employed 50 individuals in 2019 and had an annual payroll of more than $4.4 million.
On August 13, 2020, the bank authorized the loan and sent $954,000 to ADA Auto Group's commercial bank account. Within a few weeks, Arena mailed a $24,135 check from the ADA Auto Group account to a bank account for WildWest Trucking, which had likewise been dormant since 2017, according to court documents. On September 23, 2020, he used the same ADA Auto Group checking account to purchase a 2018 Chevrolet Colorado for $35,000 at a Depew dealership.
According to court documents, Arena purchased a 2018 Chevrolet Traverse for $12,500 six days later at the same dealership. Both cars were eventually discovered parked at Arena's Great Valley house by federal investigators. Prosecutors stated that none of the PPP loan funds seemed to have been used for ADA Auto Group's business-related expenses.
On June 9, Arena appeared in U.S. District Court in Buffalo. Gloria made her first appearance in federal court in Oklahoma on Friday. Since May 28, a federal complaint had been sealed. Both were charged with bank fraud conspiracy, participating in monetary transactions with criminally derived proceeds conspiracy, bank fraud, and participating in monetary transactions with illegally derived proceeds. The FBI Buffalo Field Office and the IRS Criminal Investigative Division looked into the matter.
Arena and Gloria face up to 30 years in prison for each conspiracy and substantive count of bank fraud, and up to 10 years in prison for each conspiracy and substantive count of participating in monetary transactions with criminally generated gains, if convicted. Arena pled guilty in March to six felony charges stemming from a national plan to establish and exploit false identities in order to conduct fraud. Prosecutors in Suffolk County claimed Arena used shell businesses to boost credit ratings for false identities as part of a scheme involving 13 defendants. Three business defendants, including ADA Auto Group, were also accused in the scam. Prosecutors said the defendants used stolen Social Security numbers to construct synthetic identities of persons with no credit history or who are unlikely to check their credit history, such as minors and jailed individuals. When the phony identities acquired strong credit reports, participants in the scam utilized them to acquire loans and credit cards without repaying the borrowed money, according to prosecutors.
Arena was also charged federally in connection with the bank fraud plot. According to the U.S. Attorney's Office in Newark, New Jersey, he was sentenced in April to 48 months in federal prison and forced to pay $1.3 million in restitution to Synchrony Bank.