A West Seattle-based doctor is charged with two federal counts of fraud, accused of fraudulently seeking more than $3 million in federal COVID-19-relief Paycheck Protection Program loans. The charges against 41-year-old Dr. Eric Shibley were announced Tuesday; a reader called our attention today to the fact the defendant has an office in West Seattle. From the federal announcement:
The complaint alleges that Shibley submitted several fraudulent PPP loan applications to federally insured financial institutions, other U.S. Small Business Administration-approved lenders, and the SBA in the names of businesses with no actual operations or by misrepresenting the business’s eligibility. In the applications, Shibley allegedly misrepresented the number of employees and payroll expenses in several applications and concealed his own criminal history. To support the fraudulent applications, the complaint alleges that Shibley submitted fake tax documents and the names of purported employees who did not, in fact, work for the businesses for which Shibley claimed they worked. The complaint alleges that Shibley fraudulently sought over $3 million in PPP loans.
The CARES Act is a federal law enacted March 29. It is designed to provide emergency financial assistance to millions of Americans who are suffering the economic effects resulting from the COVID-19 pandemic. One source of relief provided by the CARES Act is the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses through the PPP. In April 2020, Congress authorized over $300 billion in additional PPP funding.
Shibley appeared before a federal magistrate on Tuesday and is out on bond. The charging documents say:
According to records available on the Washington State Department of Health website, the status of SHIBLEY’s license to practice medicine is identified as “summary restriction” due to allegations of unprofessional conduct. … According to records from the Anacortes Municipal Court, located in Anacortes, Washington, SHIBLEY pled guilty to a Violation of a No Contact Order, a criminal misdemeanor under Washington State law, on December 13, 2018 and was sentenced to a jail term of 364 days, with 334 days suspended, a $5,000 fine, and two years’ probation.
That factored into the charges, which allege that he was asked on a loan application if he was currently on probation or parole and answered no, which would have disqualified him. The charges allege that he applied for PPP loans – which under certain circumstances don’t have to be paid back – in the name of 12 different entities. Much of the documentation focuses on a construction company, the name of which Shibley is accused of using to open multiple bank accounts, and seeking a PPP loan for $563,500 on the same day of a 90 percent ownership-interest transfer to him. The charging papers say investigators found the construction company “has no apparent employees for which it pays federal payroll taxes and (that a form) Shibley provided in support of the PPP loan application is fake.” The loan, however, was approved (and later canceled).