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SALT LAKE CITY — Federal prosecutors are trying to seize properties in Utah and Nevada that they say were purchased illegally using federal money meant for COVID-19 relief for businesses.
But an attorney for the property owner says the whole thing is a misunderstanding.
In a civil case filed earlier this month, the U.S. Attorney's Office for Utah accuses Giuseppe Mirenda — who owns three italian restaurants with family members — of obtaining roughly $1.8 million in federal funds and using part of the money to purchase homes in West Jordan and Las Vegas, which the government is now trying to seize.
Mirenda is part owner of Sicilia Mia italian restaurants in Farmington and Holladay, and Anticia Sicilia restaurant in Millcreek, the complaint states.
Though prosecutors made claims in a civil complaint that could constitute alleged crimes — including claims of loan application fraud, wire fraud and money laundering — no criminal charges have been filed against Mirenda. On Friday, a spokesman for the U.S. Attorney's Office declined to say whether prosecutors are considering criminal charges.
Mirenda's attorney, Clayton Simms, told KSL.com Friday that his client has done nothing wrong. The loans have yet to come due and Mirenda intends on paying them back in full and before the due date, Simms said.
The civil complaint alleges that Mirenda made misrepresentations when he submitted eight applications for Economic Injury Disaster Loans, a type of loan administered by the U.S. Small Business Administration. The CARES Act, which was signed into law in March 2020, authorized the SBA to provide Economic Injury Disaster Loans of up to $2 million to eligible businesses impacted by COVID-19, the civil complaint says.
Mirenda listed himself on each application as the sole owner of that business, even though he and two family members each hold a one-third interest in the businesses, the complaint says. Mirenda also allegedly listed himself as a U.S. citizen, though the complaint says he is not a citizen but rather a lawful permanent resident.
The complaint alleges that Mirenda agreed in the applications that the money would be used for "working capital," which the complaint defined as rent, utilities, wages and other expenses.
Simms said the dispute comes down to the definition of "working capital," as his client believed the purchases he made would fall into that category.
"We believe that you can buy a home office, we believe that you can buy property that supports an Airbnb," Simms said. He later clarified that the West Jordan property served as a home office and the Las Vegas property served as an Airbnb asset. The complaint says Mirenda used the West Jordan property as his personal residence.
"That's absolutely something that that type of real estate asset, in this market and the real estate market in Las Vegas, is. You can easily sell those, easily convert that into working capital," Simms said.
Mirenda ultimately received funds from the Small Business Administration on six loan applications, according to the complaint. The document says that in each of the six cases, Mirenda opened new checking accounts for each business, even though there were other accounts that already existed.
He consolidated the money into one account, according to the complaint, which totaled over $1.8 million. Mirenda is accused of later transferring $610,000 into an account he held jointly with one of his family members.
The complaint says that on Oct. 8, 2020, Mirenda transferred a little over $610,000 to a title company to purchase the property in West Jordan. In July 2021, Mirenda allegedly transferred $10,000 from the consolidated account as an earnest payment on the Las Vegas property. He later made a second transfer of over $508,000 from the consolidated account in order to complete the purchase, the complaint says.
"In conjunction with the purchase of the (Las Vegas property), law enforcement forensically reviewed (the consolidated account) and determined that there was a total of $2,100,242.88 in total deposits from April 22, 2020, the date the account was opened, through Aug. 6, 2021," the complaint says.
Simms said the civil complaint is the result of a misunderstanding among federal departments, and he and his client want to make certain that the loan was used lawfully.
"The loan was used in conformity with the purpose of the business, and there's absolutely and totally nothing inappropriate about what was done," Simms said. "The problem is that in the environment in which other people are defrauding the government, it can tarnish our reputation and damage us when we did absolutely nothing wrong."
Simms said that the loans should be paid back and Mirenda is in the process of doing that. A Thursday court filing says that Mirenda was already in the process of selling the West Jordan property before the civil complaint was filed against the property on April 19, and the money from the potential sale would go right back to the federal government.
Simms added that after reviewing the contract, he believes there's no civil or criminal wrongdoing in the case.
"Anyone can be falsely accused of a crime," Simms said. "You can't stop the government from charging you. But at the end of the day, the truth will come out and see that there's absolutely nothing wrong with what happened here."
