NM man faces 30 years in prison for $650K COVID relief scam

An Alamogordo man has pleaded guilty in federal court to orchestrating an extensive fraud scheme that exploited COVID-19 pandemic relief programs, netting more than $650,000 through fabricated businesses, falsified records, and false statements to lenders and the federal government.

According to court documents filed in the U.S. District Court for the District of New Mexico, 63-year-old Scott A. Spiro carried out the scheme between at least April 2020 and December 2021, during a period when the federal government was rapidly distributing emergency aid to help legitimate small businesses survive pandemic-related shutdowns. Instead of using the funds as intended, prosecutors said Spiro diverted the money for personal expenses — including the purchase of two residential properties in southern New Mexico.

Federal authorities say Spiro submitted multiple fraudulent applications under the Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL) program, both authorized by Congress through the CARES Act. Those programs were designed to provide emergency financial assistance to small businesses that maintained employees and payroll during the pandemic.

To carry out the fraud, Spiro created several shell companies that were not legitimate operating businesses, had no employees, and paid no wages. Among the entities used in the scheme were Scott A. Spiro JD, LLC; Pacifica Law Clinic, LLC; Spiro Enterprises of NM, LLC; Pacifica Funding Corporation; and Accounting Advisors.

Using these entities, Spiro submitted multiple loan applications and loan forgiveness requests to private lenders and the Small Business Administration. In those filings, he admitted to making material misrepresentations about critical details such as when the companies were established, how many employees they had, how much payroll they paid, and their reported revenues.

Prosecutors said Spiro supported the false applications with a wide array of falsified documents, including fabricated IRS forms, payroll records, bank statements, and filings purportedly submitted to the New Mexico Secretary of State. These misrepresentations led lenders and the federal government to approve and disburse more than $650,000 in pandemic relief funds.

Rather than using the money for eligible business expenses such as payroll, rent, or utilities, Spiro admitted that he used the funds to pay personal debts and cover private expenses. He also acknowledged engaging in money laundering by conducting at least two financial transactions exceeding $10,000 using criminally derived funds. Those transactions included the purchase of residential properties in Alamogordo and Ruidoso, authorities said.

Spiro pleaded guilty to eight federal felony counts, including three counts of wire fraud, three counts of making false statements to a financial institution, and two counts of money laundering. Each of the wire fraud and false statement charges carries significant potential penalties, and the money laundering convictions substantially increase his sentencing exposure.

At sentencing, which has not yet been scheduled, Spiro faces a maximum possible penalty of up to 30 years in federal prison, in addition to fines and an order to pay restitution to the government.

The case was announced by Acting U.S. Attorney Ryan Ellison for the District of New Mexico and Jarom Gregory, Acting Special Agent in Charge of IRS Criminal Investigation’s Phoenix Field Office. The investigation was conducted by IRS Criminal Investigation with assistance from the Social Security Administration.

Federal officials emphasized that pandemic relief fraud remains a top enforcement priority, noting that funds stolen through such schemes directly undermine programs intended to support struggling businesses and workers during a national emergency. The U.S. Attorney’s Office for the District of New Mexico is prosecuting the case.