Minnesota State Wire

Mark Erjavec, a 49-year-old resident of Edina, Minnesota, has been indicted on five counts of wire fraud for allegedly stealing more than $975,000 in Covid-19 relief funds. Acting U.S. Attorney Joseph H. Thompson announced the indictment and stated that Erjavec made his initial appearance in federal court.

“Erjavec stole nearly $1 million in government dollars meant to keep small businesses alive during the pandemic,” said Acting U.S. Attorney Joseph H. Thompson. “When Minnesotans were struggling to keep their doors open and pay their workers, Erjavec lined his own pockets. Fraud that exploits a crisis is especially shameful.”

According to the charges, after the onset of the Covid-19 pandemic, Erjavec created a scheme to defraud federal programs designed to help small businesses weather economic hardship. He did this by reactivating several dormant business entities he had previously owned from the mid-1990s until the early 2000s—companies such as Tricolor Heron, LLC and Mesaba Finance – Law, LLC—which had been dissolved between 2008 and 2013.

Between April and August 2020, authorities allege that Erjavec used these revived companies to submit fraudulent applications for Economic Injury Disaster Loan (EIDL) and Paycheck Protection Program (PPP) funds through the Small Business Administration (SBA). The indictment claims he exaggerated revenues, invented employees who did not exist, and included fake IRS tax forms with his applications. In many cases, new checking accounts were opened shortly after re-registering each business entity.

The investigation found that over $975,000 was obtained through these fraudulent activities and transferred into accounts controlled solely by Erjavec for personal use.

“As alleged in the indictment, Mark Erjavec knowingly submitted false and fraudulent documents to the Small Business Administration in order to take money intended for legitimate small businesses suffering during the Covid-era economic downturn,” said Minneapolis FBI Special Agent in Charge Alvin M. Winston Sr. “Erjavec re-registered dormant business entities in order to facilitate the theft of more than $975,000 in taxpayer dollars. Our efforts to stop this egregious fraud are moving forward full speed ahead; we will work with our partners at the Small Business Administration and the U.S. Attorney's Office to hold accountable those who illegally enrich themselves by defrauding the government.”

The case is being prosecuted by Assistant U.S. Attorney Bradley M. Endicott following an investigation led by both the Office of Inspector General at the Department of Commerce and the FBI as part of a task force under the Pandemic Response Accountability Committee (PRAC). This committee was established specifically to oversee transparency and coordinate oversight related to federal pandemic response spending.

It should be noted that an indictment is only an allegation; Mark Erjavec is presumed innocent unless proven guilty beyond a reasonable doubt in court.