Rhode Island trucking company owner charged with bank fraud
August 19, 2019
The owner of a Rhode Island trucking company has been charged for allegedly attempting to defraud the Federal Motor Carrier Safety Administration, according to federal court documents.
On July 24, Michael Chaves, president and sole shareholder of Providence, R.I.-based CAT Inc., was charged on 10 various counts of fraud. CAT Inc. was an automotive transportation company.
The 10-count indictment includes five counts of bank fraud, two counts of wire fraud, one count of falsification of records, one count of aggravated identity theft and one count of tax evasion. Chaves pleaded not guilty on Aug. 2, according to court records.
If convicted, Chaves faces several years in prison and potentially hundreds of thousands of dollars in fines and restitution.
In February 2016, Chaves submitted false 2014 personal tax return and 2014 business return documents for CAT Colonial Auto and motor vehicle purchase contract when applying for a $60,000 loan, according to federal court documents.
The indictment claims Chaves committed a similar offense at a different financial institution in November 2017. This time, he allegedly submitted false earning statements, motor vehicle purchase contracts and DMV documents for a $35,000 loan.
Chaves went to a third financial institution in October 2018. According to the indictment, he submitted false documents to obtain a $50,000 loan before going to a fourth credit union to fraudulently obtain another $50,000 loan in February 2019.
Additionally, Chaves is accused of defrauding another Rhode Island bank out of more than $64,000 by submitting 15 fraudulent checks made out to CAT Inc., according to a news release from the U.S. Attorney’s Office for the District of Rhode Island. The checks were purportedly drawn on an account of Land Rover of Richmond.
The news release also said that Chaves’ money scheme got into interstate commerce when he used wired communication to obtain two other loans. Chaves is accused of submitting documents via wire communications to obtain a $47,000 loan from a fifth financial institution in August 2016, as well as fraudulently wiring money for a separate $90,000 loan.
All of these loans were under the guise of obtaining commercial vehicles for his business, federal court documents state. However, Chaves’ business was placed out of service for safety violations. To skirt this dilemma, Chaves used someone else’s identification that would show no affiliation with shut-down operation, according to news release from the Department of Transportation’s Office of Inspector General. Chaves also attempted to influence and impede FMCSA investigations and administrative compliance reviews by falsifying U.S. DOT records, according to a press release from the Rhode Island U.S. Attorney’s Office.
In the end, Chaves had defrauded several Rhode Island banks out of more than $400,000, according to the DOT Office of Inspector General.
Tax evasion totals are estimated at more than $200,000 over a four-year period, according to court documents.