An Anchorage couple was arrested and indicted on charges of fraudulently obtaining millions in Covid-19 relief funds through deceitful business practices.
The Anchorage Assembly gave $1.6 million in 2021 to the charity, which said it worked to help homeless addicts get shelter and treatment.
Rosalina Natazha Mavaega, 41, and Pastor Esau Malele Fualema Jr., 44, stand accused of using their nonprofit, House of Transformations, a homeless services enterprise, and associated corporate entities to deceive the Municipality of Anchorage. Back in 2015, Mavaega was banned by the State of Alaska from ever being authorized as a Medicaid provider, due to shady practices.
In April 2021, court records reveal that the duo sought over $1.6 million from the American Rescue Plan Act (ARPA) from the Assembly. These funds intended to support businesses hampered by the Covid pandemic policies put in place by government lockdowns and mandates.
The application included misleading details regarding the scope of services to be provided by their nonprofit, such as housing, treatment, and vocational training. Further, financial and management data for House of Transformations were falsely portrayed to inflate their entitlement to these funds.
By August of the same year, the couple had received a substantial payment from the Anchorage Assembly, amounting to $1,623,165. Rather than channeling these funds to their stated cause, Mavaega and Fualema are alleged to have redirected the money for personal gain. This included financing their for-profit ventures, settling tax debts, acquiring a personal loan, and purchasing cryptocurrency.
The couple’s fraudulent activities didn’t end there. In December 2021, they are said to have made deceptive applications to the Economic Injury Disaster Loan (EIDL) program. The intent behind these applications was to acquire over a million dollars by falsifying business statuses, overreporting employee counts, misrepresenting company structures, and illicitly using personal identification of others to simulate association with their corporate entities.
Their illegal scheme peaked in the summer of 2022, with another alleged attempt to defraud the Municipality of Anchorage, seeking approximately $2 million in additional ARPA grants.
The charges against Mavaega and Fualema include major fraud against the U.S., wire fraud conspiracy, wire fraud, money laundering conspiracy, and aggravated identity theft.
Arrests were made at the Captain Cook Hotel for Mavaega and Fualema’s residence. Pending court appearances, they could face a minimum of 24 months imprisonment.
This case was unveiled through a joint announcement by U.S. Attorney S. Lane Tucker of the District of Alaska; IRS Criminal Investigation, Seattle Field Office, Special Agent in Charge Adam Jobes; and Small Business Administration Office of Inspector General, Western Region Special Agent in Charge Weston King.
The investigative charge is jointly shouldered by the IRS Seattle Division and the Small Business Administration Office of Inspector General.
Assistant U.S. Attorneys James Klugman and Karen Vandergaw, along with former U.S. Attorney George Tran, are leading the prosecution against the indicted.