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Saratoga County residents Deborah Budhraj, age 52, and Adesh Budhraj, age 53, both of Ballston Lake, pleaded guilty to bank fraud and wire fraud charges in federal court in Albany on Wednesday, July 19.
The couple formerly owned the Tropics Restaurant & Bar, located in Schenectady on South Brandywine Avenue.
According to prosecutors, they agreed to sell the business to another couple in February 2020 and received most of the purchase money, totaling $265,000, the following month. However, the sale would not be finalized until August 2021.
In the meantime, the couple buying the business took over managerial responsibilities, handling payroll as well as the lease and utilities payments.
Deborah and Adesh Budhraj later confessed that they applied for two Paycheck Protection Program (PPP) loans and one Economic Injury Disaster Loan (EIDL) without the couple’s knowledge.
The loans, which were issued by the US Small Business Administration (SBA) between April 2020 and June 2021 and meant to help businesses and employees struggling due to the COVID-19 pandemic, totaled $558,514.
The Budhrajs admitted to investigators that they never intended to use the loans on business expenses and instead blew the money on real estate transactions and personal expenses.
Deborah Budhraj later had her two PPP loans forgiven by falsely claiming that the funds had gone toward payroll, prosecutors said.
The couple now faces up to 30 years in prison for the bank fraud conviction and up to 20 years for the wire fraud conviction.
They also agreed to pay $558,514 in restitution to the SBA and to forfeit that same amount.
They are scheduled to be sentenced Thursday, Nov. 16.
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