A man who tried to scam hundreds of thousands in Covid-19 relief loans from the US government before faking his own death has been sentenced to more than four years in federal prison.
David Adler Staveley is the first known person in the country to be charged with fraudulently seeking forgivable pandemic relief small business loans under the CARES Act, Acting US Attorney Richard B Myrus in a statement on Thursday.
Staveley, who is also known as Kurt David Sanborn or David Sanborn, and accomplice David Andrew Butziger filed four fraudulent loan applications with a Rhode Island bank on behalf of several businesses with large monthly payrolls.
Combined, they sought nearly $550,000 in loans for two Warwick, Rhode Island restaurants, a Berlin, Massachusetts restaurant and a wireless company – none of which Staveley owned.
Not only did Staveley, 54, have no stakes in the businesses he sought relief for, but two of the businesses were closed at the time the loan applications were submitted, and remain closed.
The wireless company had no employees and no wages were ever paid by the business.
As the loan applications were pending, ‘a concerned citizen aware of their fraudulent nature brought them to the attention of law enforcement which ultimately led to their denial’, a sentencing memo states.
Staveley appeared in US District Court in May 2020 and was released to home detention with an electronic monitoring device.
Three weeks after he was charged for fraudulently seeking the small business loans, he removed his monitoring device, staged his own suicide and ran.
Staveley left suicide notes with family and associates, many of whom believed he was dead, the Washington Post reported.
The notes were left among many close to him, including his 80-year-old mother. When his unlocked car was found at a beach near the Atlantic Ocean, keys in the ignition alongside his wallet, law enforcement dispatched a search and rescue for him.
Many believed he was dead, but those who knew him best figured it was another one of Staveley’s schemes – and they were right, federal investigators found.
While on the run, Staveley traveled to various states using fake identities and stolen license plates. US Marshals apprehended him in Alpharetta, Georgia, after he had been on the run for nearly two months.
Staveley will have three years of federal supervised release.
Butziger, 53, who pleaded guilty in September 2020 to conspiracy to commit bank fraud, won’t be sentenced until November 1.
The FBI and Internal Revenue Service Criminal Investigation were in charge of looking into this incident, and the cases are being prosecuted by Assistant US Attorney Lee H Vilker.
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