A federal judge has sentenced a man from suburban Chicago to over five years in prison for fraudulently obtaining more than $1.5 million in small business loans under the CARES Act. Feroz Jalal, 51, of Niles, Illinois, participated in a scheme during 2021 to defraud banks and the U.S. Small Business Administration (SBA).
The SBA's Paycheck Protection Program was designed to help small businesses with low-interest loans during the Covid pandemic. Jalal submitted at least a dozen fraudulent applications for these loans on behalf of businesses he claimed to own. The applications included false statements about employees, revenues, costs, and operational statuses. To support his claims, Jalal provided fake IRS tax filings and bogus payroll spreadsheets.
In total, Jalal and his associates submitted fraudulent loan applications amounting to $1.792 million, resulting in $1.644 million being disbursed by lenders.
Jalal pleaded guilty last year to charges of bank fraud and money laundering. On February 11, 2025, U.S. District Judge John F. Kness sentenced him to five years and two months in federal prison and ordered restitution exceeding $1.5 million to the SBA.
The sentence was announced by Morris Pasqual, Acting United States Attorney for the Northern District of Illinois; Douglas S. DePodesta, Special Agent-in-Charge of the FBI's Chicago Field Office; and Sean Fitzgerald, Special Agent-in-Charge of Homeland Security Investigations' Chicago office. Assistance came from the U.S. Department of Health and Human Services' Office of Inspector General (HHS-OIG). Assistant U.S. Attorney Brian Hayes represented the government.
Information about attempted Covid-relief fraud can be reported to the Department of Justice through the National Center for Disaster Fraud at (866) 720-5721 or online at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.