John Gotti’s grandson faces a 15-month prison term after orchestrating a $1.1 million pandemic relief fraud scheme involving cryptocurrency.
Aggrieved by the U.S. government’s pandemic aid program, the mobster’s grandson successfully siphoned off $1.1 million, directing at least half of those funds into cryptocurrency ventures.
Key Points:
- Carmine G. Agnello, the grandson of notorious mob boss John J. Gotti, received a 15-month prison sentence for fraudulently securing $1.1 million in pandemic relief funds, which he largely funneled into cryptocurrency.
- According to prosecutors, Agnello provided misleading details to the Small Business Administration from April 2020 through November 2021, falsely asserting the funds were intended for his Queens-based auto parts and recycling enterprise, including worker wages.
- This case highlights the widespread fraud within pandemic aid programs, with the Government Accountability Office estimating that approximately $135 billion, or up to 15 percent of the total relief money, was lost to scams.
Carmine Agnello, grandson of the infamous mob boss John Gotti, was handed a 15-month prison sentence for defrauding the U.S. government’s pandemic relief program of $1.1 million, which he then invested in cryptocurrency, according to the Department of Justice.
In a statement released Monday, the U.S. Attorney’s Eastern District of New York office revealed that Agnello fraudulently secured multiple disaster relief loans from the Small Business Administration (SBA) and diverted the funds into cryptocurrency investments.
“Agnello diverted [the proceeds] for his personal use, including by investing approximately $420,000 in a cryptocurrency business,” the attorney’s office stated.
The fraudster, who will surrender to authorities on July 1 to begin his sentence, submitted false information to the SBA between April 2020 and November 2021, claiming the money was for his auto parts and recycling business in Queens, including employee salaries.
“During the height of the COVID-19 pandemic, the defendant shamefully lined his own pockets with government and taxpayers’ dollars, which he must repay as part of today’s sentence,” said United States Attorney Joseph Nocella.
“Mr. Agnello defrauded a program designed to assist businesses and employees during the pandemic,” stated United States Postal Inspection Service, New York Division (USPIS) Inspector in Charge Larco-Ward.
Agnello is not the only individual to have defrauded the government’s Covid relief fund. Among several cases that ended up in court, Bruce Choi’s stands out as he illegally obtained $2 million in pandemic-eric business loans on behalf of non-existent companies and used the money to buy cryptocurrency via Kraken. David T. Hines fraudulently obtained $3.9 million from similar relief funds and used some of the proceeds to purchase a Lamborghini.
Based on statistics from the U.S. Government Accountability Office (GAO), fraud against Covid-related relief funds was rampant, with roughly $135 billion, or up to 15% of the total funds, lost to scams.
Agnello’s grandfather exerted power with brutal violence and enjoyed the spotlight. He took over the Gambino, running enterprises that authorities claimed earned him roughly $500 million a year from ventures that included extorting unions, illegal gambling, loan-sharking and stock fraud. In 1992, Gotti was found guilty on 13 criminal counts and sent to federal prison, where he died of cancer at age 61.