Eden Prairie man convicted of pandemic relief fraud

A 75-year-old Eden Prairie man was convicted last week of fraudulently obtaining more than $2.1 million in COVID-19 relief funds following a 10-day trial before Judge Eric C. Tostrud in U.S. District Court in St. Paul.

Harold Bennie Kaeding was found guilty on Aug. 2 of three counts of wire fraud, three counts of aggravated identity theft, and one count of money laundering, according to a media release from the United States Attorney’s Office for the District of Minnesota issued on Tuesday, Aug. 6.

Kaeding’s sentencing will occur at a later date.

Prosecutors presented evidence showing that between March and May 2020, Kaeding applied for loans through the Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL) Program. He used the names of close family members to apply for six fictitious corporate entities, none of which had filed tax returns or reported wages for 2019 and 2020.

Advertisement

Kaeding allegedly fabricated tax documents and bank statements to make the applications appear legitimate, including false claims about employee numbers and payroll expenses.

He received approximately $1.64 million in fraud proceeds, but banks later detected irregularities and reclaimed some of the money, leaving him with $658,490. He transferred the funds into bank accounts he controlled, including those in family members’ names. The money was used to prevent the foreclosure of his home, purchase an SUV, and accumulate more than $80,000 in cash.

In early 2021, Kaeding fled to Colombia, apparently to avoid prosecution. He was eventually located and deported back to the United States to stand trial.

The case was brought by the office of U.S. Attorney Andrew M. Luger and investigated by the Federal Bureau of Investigation (FBI) and the Internal Revenue Service (IRS). Assistant U.S. Attorneys Jordan L. Sing and Robert M. Lewis led the prosecution.

Advertisement