KY man sentenced to prison for using COVID loans to pay for plastic surgery, cruise
A London man has been sentenced to nearly two years in prison for his role in defrauding the federal government of more than $1 million in COVID-19-era loans he used to buy vehicles, purchase a cruise vacation and pay for his wife’s plastic surgery.
Joshua Pennington, 51, was sentenced in October to 22 months in prison for conspiracy to commit money laundering of Economic Injury Disaster and Paycheck Protection Program loans. The programs were designed to help small businesses stay open, pay salaries and recover during and after state and federal pandemic shutdowns.
Pennington pleaded guilty in January to conspiring with his wife, Nicole Pennington, to make false statements on 40 Small Business Administration loans, six of which were approved for a total of $1,090,398, according to court records.
The Penningtons laundered the money in $10,000 transactions that later went toward renovating their kitchen, paying for plastic surgery, purchasing a Viking River Cruise trip, withdrawing cash, purchasing vehicles and paying off loans and mortgages, the U.S. Justice Department said.
Nicole Pennington is scheduled for sentencing early next year.
Under federal law, Joshua Pennington must serve at least 19 months before he will be eligible for parole. He will be subject to two years of federal probation upon release.
The SBA estimates more than $200 billion of the $1.2 trillion it disbursed during the pandemic was obtained fraudulently, according to the Office of Inspector General. In 2021, the attorney general formed a task force to crack down on COVID-19 fraud schemes. As of 2023, federal agencies had recovered $30 billion, or about 15%.
