Miami, FL – Lazaro Verdecia Hernandez, a 37-year-old Miami resident, has been sentenced to 15 years in federal prison for orchestrating a scheme to fraudulently obtain loans through the Paycheck Protection Program (PPP) and laundering the proceeds. Hernandez, along with co-conspirator Heidi Cid, submitted over 63 fraudulent PPP loan applications. They manipulated the loan paperwork by falsifying employee numbers and forging documents to make applicants appear eligible for pandemic relief. This deception led to lenders disbursing more than $14.5 million to bank accounts controlled by individuals who then withdrew the funds and shared them with Hernandez, Cid, and another accomplice, Yadier Rodriguez Arteaga.
Arteaga and Cid were previously found guilty and sentenced to federal prison, with Arteaga receiving nearly six years and Cid 26 months.
This case was announced by the U.S. Attorney’s Office for the Southern District of Florida, with investigations conducted by the U.S. Secret Service (USSS), the Federal Housing Finance Agency’s Office of Inspector General (FHFA OIG), and the U.S. Small Business Administration’s Office of Inspector General (SBA OIG). Assistant U.S. Attorneys Thomas Haggerty and Eli Rubin prosecuted the case, while Assistant U.S. Attorney Sarah Klco managed asset forfeiture.
The fraudulent scheme led to the charging and conviction of approximately 22 individuals. Among them, Roberto Lopez, Kenia Carrillo, Lester Hedman Safont, Oreste Ruiz Linares, Honolio Navarro Caballero, Barbara Alvarez, Javier Pico, Alfredo Contrera, and Erisbel Gonzalez Gomez were involved in related cases, with all pleading guilty except for Pico and Gonzalez Gomez, who remain fugitives.
The Paycheck Protection Program was part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, enacted in March 2020 to provide financial assistance to Americans affected by the COVID-19 pandemic. The act facilitated Economic Injury Disaster Loans (EIDLs) for small businesses and independent contractors facing financial disruptions.
In response to pandemic-related fraud, the Attorney General launched the COVID-19 Fraud Enforcement Task Force in May 2021. The task force aims to enhance efforts to combat fraud by coordinating across government agencies, identifying fraudulent actors, and sharing insights from enforcement activities.
In September 2022, the Southern District of Florida’s U.S. Attorney’s Office was appointed to lead one of three national COVID-19 Fraud Strike Force Teams, further strengthening efforts to address financial fraud related to the pandemic.
