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Portland man charged after taking out PPP loans for fake businesses

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Sean Kirkpatrick spent the proceeds from cash withdrawals, payments to creditors, criminal associates, insurance and cell phones, according to federal prosecutors.

PORTLAND, Ore. — A Portland man set up two fictitious businesses, including a restaurant called “Slippery Pete’s,” to defraud the government of COVID-19 relief funds, court documents show.

Sean Kirkpatrick of Portland has been charged with wire fraud and aggravated identity theft in federal court. Prosecutors say Kirkpatrick received nearly $100,000 in Paycheck Protection Program funds.

Kirkpatrick was unemployed and was recently released from prison following a drug trafficking conviction, according to court records.

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Federal prosecutors say Kirkpatrick submitted two fraudulent PPP loan applications to the Small Business Administration.

In February 2021, Kirkpatrick used a victim’s stolen identity to apply for a $48,125 PPP loan on behalf of a company called Sphere Integration Group, prosecutors say. Records indicate that there was no such company.

In March 2021, federal prosecutors say Kirkpatrick used his own name to apply for a second $48,625 loan on behalf of a restaurant called Slippery Pete’s. The restaurant did not exist.

In support of both PPP loan applications, Kirkpatrick submitted false IRS tax forms, according to court records.

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In 2020, as COVID-19 shutdowns threatened businesses, the US government began issuing nearly $800 billion in potentially forgivable PPP loans. The program was designed to help companies keep workers employed during the pandemic.

Prosecutors say Kirkpatrick spent most of the PPP loan proceeds on cash withdrawals, payments to creditors, criminal associates, insurance and cellphones.