California Man Arrested in Arizona for $37.9 Million Loan Fraud Scheme

Rodney Rosenstein, a 58-year-old resident of Huntington Beach, California, has been detained in Arizona following allegations of orchestrating a massive loan fraud scheme totaling approximately $37.9 million. Federal prosecutors report that Rosenstein was ordered held without bond after a federal grand jury indicted him on charges of conspiracy to commit bank fraud and conspiracy to commit false statements to influence a financial institution.

According to the U.S. Attorney’s Office for the District of Arizona, Rosenstein and his associates are accused of obtaining around $2.9 million through 15 fraudulent Paycheck Protection Program (PPP) loans under the CARES Act. They allegedly submitted falsified employment tax forms and W-2 documents to secure these loans, later using additional false payroll records to obtain loan forgiveness.

The indictment further claims that the group secured another $35 million in commercial loans by providing falsified rent roll documents and other misleading information to banks and financial institutions. If convicted on the bank fraud conspiracy charge, Rosenstein faces a maximum penalty of 30 years in prison and a $1 million fine. The false statements charge carries a potential five-year prison sentence and a $250,000 fine.

The investigation was conducted by the FBI Phoenix Division’s Tucson office, IRS Criminal Investigation, and the Federal Housing Finance Agency Office of Inspector General.