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OC Pizza Parlor Owner Gets 3 Years For Fraudulent Loan Scheme

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(credit: CBS)

(credit: CBS)

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LOS ANGELES (CBS) — An Orange County pizza parlor owner has been sentenced to three years in federal prison for fraudulently taking more than $1.1 million in loans that were guaranteed by the Small Business Administration.

James Kim, 56, of La Palma pleaded guilty in January to one count of making false statements on a loan application. Kim admitted he lied to obtain three loans from Nara Bank in 2007, according to the U.S. Attorney’s Office.

Kim was ordered to pay nearly $2.4 million in restitution, including nearly $800,000 to the SBA for the fraudulently obtained loans, as well as more than $1.3 million he failed to pay companies that leased him restaurant equipment and property.

Prosecutors say Kim admitted that on the three loan applications, he falsely reported that neither he nor his businesses were involved in any pending lawsuits and had no business indebtedness.

Actually, Kim knew, before and during the SBA loan application process, that he had been named in two civil lawsuits that ultimately resulted in judgments against him and was aware that he had millions of dollars in indebtedness.

In the plea agreement filed in the case, Kim also acknowledged that he submitted false tax returns when applying for leases on other businesses in 2006.

(©2011 CBS Local Media, a division of CBS Radio Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. Wire services contributed to this report.)

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