A former restaurant owner from Montgomery County, Giuseppina “Josephine” Leone, has been sentenced to 21 months in prison for fraudulently obtaining loans meant to assist businesses during the COVID-19 pandemic, according to a recent announcement by U.S. Attorney Jacqueline C. Romero. The 62-year-old from North Wales, Pennsylvania, was also ordered to pay a $50,000 fine, and a $300 special assessment, and has made full restitution amounting to $972,861.75. Despite Leone's request for a non-custodial sentence, U.S. District Court Judge Gerald A. McHugh denied this request, opting instead for prison time followed by one year of supervised release.
Leone, alongside her husband, were once proprietors of Ristorante San Marco, an Italian eatery in Ambler, Pa. The restaurant, before its temporary closure amid the pandemic in March 2020, had been part of an Agreement for the Sale of Real Property. It notably never reopened. Despite this closure, Leone proceeded to misleadingly apply for a Paycheck Protection Program (PPP) loan in April 2020, claiming to maintain a staff of 17 and promising to use the proceeds for payroll, as per the U.S. Attorney's Office, Eastern District of Pennsylvania. The application, fraught with inaccuracies given the restaurant's inactivity, was nevertheless approved, with loan forgiveness later granted based on further misrepresentations by Leone.
The defendant's fraudulent activities came to an end when a thorough investigation by various federal bodies including the Small Business Administration Office of Inspector General, the FBI, and Homeland Security Investigations, led to the exposure of her deceit. In a stern address, U.S. Attorney Romero condemned the exploitation of federal relief efforts, stating, "PPP and the other covid relief programs were meant to provide emergency aid to businesses and employees financially flattened by the pandemic," and affirming the government's resolve to "continue to aggressively pursue and prosecute anyone foolish enough to do so," as stated by the U.S. Attorney's Office, Eastern District of Pennsylvania.
The case is under investigation by the Small Business Administration's Office of Inspector General, the FBI, and Homeland Security Investigations, and is being prosecuted by Assistant United States Attorney Angella Middleton.
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