DENVER – A Highlands Ranch man was sentenced to nearly 3 ½ years in federal prison for fraudulently obtaining more than $800,000 through federal pandemic loans, grants, and unemployment claims that he spent on things like travel, jewelry and plastic surgery.
Daniel Stonebarger, 50, agreed to a plea deal with the U.S. Attorney’s Office for the District of Colorado after admitted to using several LLCs, including some that had previously been dissolved, to fraudulently obtain Economic Injury Disaster Loans and Grants, Paycheck Protection Program loans, and unemployment assistance, according to his plea agreement.
Through the various businesses, some of whose information was falsified, Stonebarger was able to get around $855,252 through the EIDL, EIDG and PPP loans and grants, according to court documents.
He also applied for Pandemic Unemployment Assistance, one of the federal unemployment programs launched about three months into the COVID-19 pandemic, and though he asked for payments backdated to March 2020, his business records were not created until April 1.
But he was still able to get paid $28,142 in the PUA funds by the Colorado Department of Labor and Employment.
Among the things he bought with the fraudulent money were a 2016 Range Rover he said was for his wife, $9,000 in plastic surgery for a relative, $7,000 for weight loss, $5,000 in bridal expenses, $10,000 in jewelry, and $2,800 for Peloton, travel and resort expenses, according to his plea agreement.
Aside from the money he did receive through the various loans and grants, he also had several requests denied by the Small Business Administration over failure to verify certain information.
“This defendant took money that was supposed to be used to provide emergency financial assistance to small businesses and individuals suffering adverse economic effects caused by the COVID-19 pandemic,” said U.S. Attorney Cole Finegan. “Prosecuting pandemic fraud is a priority of the Department of Justice and an ongoing focus for investigators here in Colorado.”
In addition to the 41-month prison sentence, Stonebarger will have to serve three years of supervised released to follow. He also has to pay $794,462 to the SBA and $28,142 to the CDLE in restitution, and the judge issued a forfeiture judgment in the case to the tune of more than $822,000.
The prosecution involved the COVID-19 Fraud Enforcement Task Force established in May 2021 to help dig through the millions in pandemic-related fraud. The CDLE, FBI, Secret Service and U.S. Attorney’s Office were involved in the investigation.
“We created the Colorado Unemployment Fraud Task Force to investigate and prosecute those who steal critical pandemic-related government funds for personal gain,” Colorado Attorney General Phil Weiser said in a statement. “I am thankful and proud of the collaboration between the task force and the U.S. Attorney’s office that enabled us to bring this defendant to justice for defrauding the government.”