Illinois Man Gets 10 Years for Orchestrating $14M Pandemic Loan Fraud Scheme (Chicago, IL) – A suburban Illinois businessman has been sentenced to 10 years in federal prison for orchestrating a massive fraud scheme that siphoned millions of dollars from a COVID-19 relief program intended to support struggling businesses during the pandemic.
Sharhabeel Shreiteh, 46, was sentenced March 10 by U.S. District Judge Martha M. Pacold after pleading guilty to wire fraud. Federal prosecutors said Shreiteh fraudulently obtained at least $14 million through more than 1,500 bogus Paycheck Protection Program (PPP) loan applications submitted in 2020 and 2021.
The PPP, created under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, was designed to help businesses maintain payroll and operations during pandemic-related disruptions.
According to authorities, Shreiteh, a tax preparer based in Palos Hills, recruited individuals and businesses to provide personal information, which he then used to file fraudulent loan applications. The applications contained inflated or fabricated details about payroll, income, and business operations.
For each successful loan, Shreiteh received kickbacks ranging from $1,000 to $4,000, totaling at least $741,000.
Prosecutors said Shreiteh used the illicit proceeds to fund a lavish lifestyle, including home renovations in Crete, Illinois, and vacations to Florida and South Carolina. He also transferred hundreds of thousands of dollars to financial institutions in the Palestinian Territories, where some of the money was used to build a second home.
In addition to the prison sentence, Judge Pacold ordered Shreiteh to forfeit $741,000 and pay $14 million in restitution to the federal government.
During sentencing, Pacold emphasized the seriousness of exploiting emergency relief funds.
“Any fraud against any government program, but in particular a program that was an emergency relief program, to take advantage of those emergency funds and ultimately to steal from taxpayers is a terrible thing,” the judge said.
She further noted that such fraud undermines public trust and could hinder future emergency assistance efforts.
The court also cited evidence that Shreiteh collected unemployment benefits from Illinois and Ohio while simultaneously operating the fraud scheme and working as a tax preparer.
U.S. Attorney Andrew S. Boutros, along with officials from the FBI and IRS Criminal Investigation, announced the sentence, underscoring ongoing efforts to investigate and prosecute pandemic-related fraud.
Assistant U.S. Attorney Elie Zenner described the scheme as “massive” and “callous,” noting that it diverted critical funds away from legitimate businesses during a time of national crisis.
Authorities encourage anyone with information about suspected COVID-19 fraud to contact the National Center for Disaster Fraud.
Illinois Man Gets 10 Years for Orchestrating $14M Pandemic Loan Fraud Scheme
