California Man Arrested Over $38 Million Loan Fraud Scheme

Federal prosecutors have detained a California resident accused of siphoning nearly 38 million dollars from pandemic relief programs and commercial lenders. Rodney Rosenstein of Huntington Beach was ordered held without bond in Arizona after a federal grand jury returned an indictment on conspiracy to commit bank fraud and making false statements to financial institutions.

Authorities state the group obtained roughly 2.9 million dollars through 15 fraudulent Paycheck Protection Program loans by submitting phony tax forms and W 2 documents. The accused individuals then allegedly used additional false payroll records to secure loan forgiveness. Separately, the indictment claims the same group secured another 35 million dollars in commercial loans by providing falsified rent roll documents to banks.

Conviction on the bank fraud conspiracy count carries a maximum of 30 years in prison and a one million dollar fine. The false statements charge carries up to five years in prison. Investigators from the FBI, IRS Criminal Investigation, and the Federal Housing Finance Agency handled the probe as regulators continue targeting financial crimes.