Final Motion Filed to Seize Dozens of Crypto and Bank Accounts Related to PPP Loan Scam

News | July 5, 2024 By:

On Tuesday, June 18, 2024, the United States government filed a final motion for forfeiture of property in federal court against Joao Mendes.

According to court documents, Mendes had previously pleaded guilty to one count of wire fraud in connection with fraudulently obtaining over $1.5 million in COVID-19 relief loans meant to help small businesses struggling during the pandemic. Instead of using the funds as intended, Mendes spent the money on personal expenses, including cryptocurrency purchases.

In its motion, the United States sought forfeiture of 27 different assets identified as being connected to Mendes’ criminal activity. This included several bank accounts holding conventional money as well as multiple digital wallets and accounts containing various cryptocurrencies such as Bitcoin, Ethereum, Cardano, Stellar Lumens, Chainlink, Uniswap, and 0x.

The motion detailed that more than $1.5 million in funds and over 50 different cryptocurrency assets had been seized from Mendes’ possession in February 2021, during the investigation of his fraud. This included over 4 Bitcoin and over 18,000 ADA seized from Coinbase, over 100,000 VET and over 1,000 ATOM seized from Binance.US, and other cryptocurrencies voluntarily surrendered later by Mendes from wallets on exchanges including Bybit, Hotbit, Kucoin and Phemex.

Additional assets sought for forfeiture included bank accounts in Mendes and acquaintances’ names, as well as conventional funds of over $20,000 surrendered from two life insurance policies pursuant to seizure warrants. All totaled, the motion sought final forfeiture of these 27 assets worth over $1.5 million in connection with Mendes’ convicted wire fraud crime.

No claims of interest in the identified properties had been made to the court within the required period, according to the motion. As such, the United States requested the court enter a final forfeiture order for the full list of assets. If granted, this would allow the funds and cryptocurrencies to be transferred permanently into government control and represent further punishment against Mendes for his fraud of COVID-19 relief programs.

Please contact BlockTribune for access to a copy of this filing.