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Utah rental company owner faces Paycheck Protection Program fraud charges

By Dennis Romboy, KSL | Posted - Aug. 14, 2020 at 4:03 p.m.

SALT LAKE CITY — A South Jordan rental company owner previously convicted for fraud faces federal charges for allegedly lying on applications to get a Paycheck Protection Program loan through the coronavirus relief bill.

Michaell Leroi Douros inflated the size of his payroll and number of employees and made false claims about ownership interests in Epic Rentals, according to information filed in U.S. District Court. He also falsely stated that he had not been convicted of a felony in the past five years, court documents say. Douros was convicted of securities fraud and communications fraud in 2017.

Federal prosecutors charged Douros with two counts each of bank fraud and making false statements to a bank and one count of money laundering.

According to court documents, Zions Bank initially funded a $198,800 PPP loan for Douros but canceled it after further inspecting his application. The next day, Douros transferred his ownership interest in Epic Rentals, which rents cars, off-road vehicles and camp trailers, to his son.

Douros then applied for a PPP loan at Cache Valley Bank using his son as a “straw” owner, according to court documents. He listed his average monthly payroll at $95,636 when it was far less than that and claimed nine employees when he had only six, prosecutors say.

The bank loaned him $239,091 and transferred the money to Epic Rentals. Within a month of receiving the money, the son sent $95,000 to Douros, court documents say.

Douros is at least the second Utah business owner to be charged with fraud in connection with the Paycheck Protection Program.

Hubert Ivan Ugarte, of Draper, lied on the loan application and illegally used more than half of the $210,000 he received to make lease or purchase payments on trucks rather than on employee wages, according to a federal indictment.

Dennis Romboy

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