Man sentenced to 51 months for fraud scheme involving COVID-19 relief programs

Correction: A previous version of this story erroenously said Cherry was sentenced to 51 years in prison. It was 51 months. WAVY regrets the error.

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NEWPORT NEWS, Va. (WAVY) — A previously convicted felon from Norfolk as sentenced to 51 months in prison Thursday for a COVID-19-related fraud scheme that resulted in nearly $200,000 in losses.

Joseph Cherry, 40, of Norfolk, was involved in a scheme that obtained COVID-related loan benefits through the Small Business Administration (SBA) and affiliated lenders.

After the CARES Act was signed into law in March 2020, the U.S. Department of Justice said Cherry took advantage of the new programs and funding offered under that act as part of the scheme, as well. Those programs include Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL).

“Exploiting programs meant to help businesses in need during a global pandemic is appalling. Today, Cherry learned his actions have repercussions,” said Kelly R. Jackson, IRS-CI special agent in charge. “We will continue to prioritize COVID-19 fraud investigations on those who essentially rob struggling businesses of the assistance they truly need.”

Authorities say Cherry submitted multiple applications for PPP and EIDL loans in March and April 2020 using false information about his claimed businesses, income, employment, and criminal record.

Cherry fraudulently obtained $196,900 in loan proceeds from the U.S. Treasury.

Cherry was also convicted in the Eastern District of Virginia in 2009 for an extensive fraud, money laundering, and identity theft scheme with losses of over $1.5 million. He has been convicted of over a dozen felony charges in federal and state courts since 2002, and he was under terms of supervision in both federal and state courts when he committed these additional fraud offenses in 2020, according to the Department of Justice.