An East Bay man has been given a prison sentence for fraudulently obtaining federal pandemic relief funds for a business that was an illegal marijuana distribution operation. Thanh Duy Nguyen, a 53-year-old resident of Brentwood, was sentenced to 37 months for his role in misrepresenting his business to secure approximately $300,000 in COVID-19 relief loans, as reported by the U.S. Attorney's Office for the Northern District of California.
Nguyen, who ran and was the sole officer of T&A Distribution, an unlicensed marijuana distribution enterprise with operations spanning the Bay Area, submitted two separate Economic Injury Disaster Loan (EIDL) applications. In these applications, he certified his business as "Antiques/Collectibles" and "Miscellaneous Services" and claimed it was a nonprofit, even though it was federally illegal. Additionally, he provided false information concerning gross revenues, cost of operations, and the number of employees.
His deceit did not go unnoticed. The loan obtained under false pretenses was meant to support small businesses disrupted by the pandemic. Instead, Nguyen used a significant portion of this capital for his marijuana business and gambling, misappropriating funds designed to cushion the economic blow delivered by the virus.
In handing down the sentence, U.S. District Judge Rita F. Lin also ordered Nguyen to serve three years of supervised release after his imprisonment and to pay $300,000 in restitution and forfeiture. Nguyen is scheduled to begin his sentence on February 28, 2025, following his guilty plea on two counts of wire fraud. As detailed in the court documents, Nguyen's true gross revenues for the 12 months before January 31, 2020, were around $2.4 million, a stark contrast to the claims made in his fraudulent loan applications.
The case against Nguyen was part of a broader crackdown. It's an effort led by the Organized Crime Drug Enforcement Task Forces (OCDETF), which works across agencies to dismantle criminal enterprises threatening the United States. United States Attorney Ismail J. Ramsey and other officials announced the outcome of this prosecution, which is indicative of the resolve against individuals exploiting federal relief measures.
Sara Slattery assisted Assistant United States Attorney Joseph Tartakovsky in prosecuting the case, which resulted from an investigation conducted by the Drug Enforcement Administration (DEA) and the Small Business Administration's Office of Inspector General (OIG).
