UNITED STATES DISTRICT COURT 

SOUTHERN DISTRICT OF FLORIDA 

CASE NO. 22-20420-CR-JEM 

UNITED STATES OF AMERICA 

v. 

ARMANDO ARIEL DE LEON, 

Defendant. 

I --------------

FACTUAL PROFFER 

The United States of America (the "United States") and defendant Armando Ariel De Leon 

(the "defendant") agree that, were this case to proceed to trial, the United States would prove 

beyond a reasonable doubt the following facts, among others, which occurred in the Southern 

District of Florida and elsewhere: 

The Paycheck Protection Program 

The Coronavirus Aid, Relief, and Economic Security ("CARES") Act was a federal law 

enacted in or around March 2020 and designed to provide emergency financial assistance to the 

millions of Americans who were suffering from the economic effects caused by the COVID-19 

pandemic. One source of relief provided by the CARES Act was the authorization of forgivable 

loans to small businesses for job retention and certain other expenses, through a program referred 

to as the Paycheck Protection Program ("PPP"). 

In order to obtain a PPP loan, a qualifying business submitted a PPP loan application, which 

was signed by an authorized representative of the business. The PPP loan application required the 

business (through its authorized representative) to acknowledge the program rules and make 

certain affirmative certifications in order to be eligible to obtain the PPP loan. In the PPP loan 

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application, the small business (through its authorized representative) was required to provide, 

among other things, its: (a) average monthly payroll expenses; and (b) number of employees. 

These figures were used to calculate the amount of money the small business was eligible to 

receive under the PPP. In addition, businesses applying for a PPP loan were required to provide 

documentation confirming their payroll expenses. 

A PPP loan application was processed by a participating lender. If a PPP loan application 

was approved, the participating lender funded the PPP loan using its own monies. While it was 

the participating lender that issued the PPP loan, the loan was 100% guaranteed by the SBA. Data 

from the application, including information about the borrower, the total amount of the loan, and 

the listed number of employees, was transmitted by the lender to the SBA in the course of 

processing the loan. 

PPP loan proceeds were required to be used by the business on certain permissible 

expenses- payroll costs, interest on mortgages, rent, and utilities. The PPP allowed the interest 

and principal on the PPP loan to be entirely forgiven if the business spent the loan proceeds on 

these expense items within a designated period of time and used a defined portion of the PPP loan 

proceeds on payroll expenses. 

The Economic Injury Disaster Loan Program 

Another related response to the COVID-19 outbreak was an expansion of an existing 

disaster-related program - the Economic Injury Disaster Loan ("EIDL") - to provide for loan 

assistance (including $10,000 advances) for small businesses and other eligible entities for loans 

up to $2 million. The EIDL proceeds could have been used to pay fixed debts, payroll, accounts 

payable, and other bills that could have been paid had the disaster not occurred; however, such 

loan proceeds were not intended to replace lost sales or profits, or for the expansion of a business. 

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Unlike certain other types of SBA-guaranteed loans, EIDL funds were issued directly from 

the United States Treasury, and applicants applied for EIDL funds directly through the SBA via 

an online portal and application. The EIDL application process, which also used certain outside 

contractors for system support, collected information concerning the business and the business 

owner, including: information about the gross revenues for the business prior to January 31, 2020; 

and the cost of goods sold. Applicants electronically certified that the information provided was 

true and accurate and were warned that any false statement or misrepresentations to the SBA, or 

any misapplication of loan proceeds may result in sanctions, including criminal penalties. 

EIDL applications were received in and processed using computer servers located in the 

states oflowa, Virginia, and Washington. EIDL disbursement payments were initiated by the SBA 

using computer servers located in the state of Colorado, which transmitted the payment 

information to the Treasury using computer servers located in the state of Virginia. 

Overview of the Defendant's Conspiracy 

From January 2021 through at least July 2021 , the defendant agreed with Daniel Hernandez 

("Hernandez") and others to submit false and fraudulent EIDL and PPP applications and share in 

a percentage of the resulting fraudulent loans. The defendant and Hernandez had previously 

worked together at Bank 1 until the defendant's dismissal from the bank in January 2021. Bank 1 

was headquartered in New Jersey with branches in the Southern District of Florida. It was an 

approved SBA lender of PPP loans and insured by the Federal Deposit Insurance Corporation 

("FDIC"). 

The defendant executed a series of tasks in furtherance of the conspiracy, including but not 

limited to the following. The defendant helped co-conspirators open bank accounts at Bank 1 to 

allow them to apply for fraudulent PPP loans at the bank. The defendant prepared and submitted 

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to the SBA over 50 false and fraudulent EIDL applications on behalf of co-conspirators. The 

defendant monitored the conspiracy's fraudulent PPP and EIDL applications, maintaining 

spreadsheets that catalogued the relevant information of each application. And the defendant 

received, on behalf of himself and Hernandez, certain commissions from co-conspirators who 

received fraudulent loans. For example, on approximately February 25, 2021 , the defendant 

deposited into a bank account he controlled at Bank 2 and ending in 1225 a cashier's check from 

Bank 1 for $29,400. The check had been purchased by the owner of AC Export Express Corp., 

which had recently received a fraudulent PPP loan from Bank 1 in the amount of $488,320. The 

cashier's check was the defendant and Hernandez's commission for their assistance with securing 

the fraudulent loan. 

The parties agree that these facts, which do not include all facts known to the United States 

and the defendant, are sufficient to prove the sole count of the information. 

Date: 

By: 

By: 

E 

A 

PAUL PE ZZI 

COUNSEL FOR DEFENDANT 

By:~ 

DEFENDANT 

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