OXFORD, Conn. — An Oxford couple who received federal COVID funding for their small business is accused of using the funds for personal use. Janine E. and Gerard Carbonaro have since paid $169,563.60 to resolve the COVID-relief loan fraud allegations, according to the U.S. States Attorney.
In April 2020, the couple applied for funding from the Coronavirus Aid, Relief and Economic Security (CARES) Act and received $109,000 for their Monroe business, "Hair Attraction Design Team".
The loan documents required the CARES money to solely go towards alleviating economic injury caused by COVID-19 for Hair Attraction Design Team. The Carbonaros were accused of using the proceeds to pay off a mortgage on a residential property in Florida and to purchase an additional residential property in Florida.
As part of the civil agreement with the government, in addition to paying the $169,563.60, the Carbonaros also agreed to withdraw a pending application for a loan increase.
An attorney for the couple released a statement on their behalf indicating that the Carbonaros deny any accusation of fraud.
"The Carbonaros entered into a Civil Settlement Agreement with the Government which specifically states, 'This Settlement Agreement is neither an admission of liability by the Carbonaros nor a concession by the United States that its claims are not well-founded.' By entering into the Agreement, the Carbonaros did not admit liability or fraud of any kind. They deny any allegation of fraud and entered into the Agreement with the Government to avoid protracted litigation," said Attorney Charlies Tiernan, III.
The CARES Act was enacted to provide emergency assistance to individuals, families, and businesses affected by the pandemic. Section 1110 of the CARES Act allowed small businesses to apply for a loan to assist in overcoming the economic hardships due to the pandemic.
The FBI is continuing to uncover other businesses and individuals who misused their CARES Act funds.
"The Justice Department and our federal investigative partners continue to bring relief to those in need," said FBI Special Agent in Charge Sundberg. "Justice has prevailed and we will continue to pursue every opportunity to combat COVID relief fraud in the State of Connecticut."
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