63ºF

Houston resident convicted in money laundering scheme linked to Hurricane Harvey

Gavel
Gavel (Pixlr)

HOUSTON – A Houston area man entered a guilty plea on Monday to money laundering in connection with his scheme to defraud the Small Business Administration (SBA), according to the Department of Justice.

Robert Kaitho, 56, applied for government assistance in reference to property damage sustained in Hurricane Harvey. In that application, he falsely represented to the SBA that he would use the disbursed funds to rehabilitate or replace the affected property.

As a result of his misrepresentations, the SBA disbursed a federally-funded disaster loan to Kaitho for $71,100, all of which was deposited into his personal bank account.

As part of his plea, Kaitho admitted he used the SBA funds to make unauthorized wire transfer payments in the amounts of $10,000 and $15,000 to a mortgage company. Kaitho also acknowledged he used funds transferred into his account to make a $30,633.00 wire transfer payment to an individual located in Kenya, another unauthorized expenditure.

Sentencing is set for June 1. At that time, Kaitho faces up to 10 years in federal prison and a $250,000 maximum possible fine. Kaitho was permitted to remain on bond pending that hearing.