Washington • Federal prosecutors have charged two Utahns with fraud for applying for a program to aid businesses hit by pandemic-related losses because the owner of the trucking company was under federal indictment at the time.
A federal complaint unsealed last week charges that Hubert Ivan Ugarte, 52, of Draper, with the help of Lisa Bradshaw Rowberry, 49, of Provo, submitted a loan application for $210,000 through the Paycheck Protection Program (PPP), but they had denied that Ugarte, the owner of the company, was facing any criminal charges.
In fact, the Justice Department says, a federal grand jury had indicted Ugarte and others in October for their involvement in a multiyear wire fraud and bribery scheme. The charges allege the trucking company owner and others bribed employees at the Salt Lake City FedEx hub to get preferential treatment.
Ugarte faces four counts of wire fraud and six counts of money laundering in the case, which is still pending.
The Justice Department also says Ugarte denied on the application for a PPP loan that he had ever been placed in a “pretrial diversion” — bypassing a trial and agreeing to resolving a criminal case in another way — regarding past charges when he had done so in 1988 when charged with felony drug possession.
Two banks had rejected Ugarte's loan application because of his pending charges but a third, Transportation Alliance Bank, submitted it to the Small Business Administration and he received the $210,000, the Justice Department said.
Moreover, Ugarte had said on his PPP application that he would use 75% of the loan on payroll, but he instead spent about 60% on loan payments for truck leases, purchases and parts, according to the federal complaint.
Ugarte is now in federal custody, while Rowberry has made an initial appearance in court and was released pending trial.