The recently ousted head of Aviron Pictures, William Sadleir, 66, of Beverly Hills, was arrested on federal fraud charges that allege he applied for $1.7 million in loans under the Paycheck Protection Program (PPP), falsely certified that the money would be used to finance the operations of other Aviron entities, and then used some of the relief funds for his personal expenses.

A criminal complaint that accuses him of fraudulently filing bank loan applications that sought more than $1.7 million dollars in forgivable PPP loans guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Sadleir allegedly obtained the forgivable loans by falsely representing that the funds would be used to support payroll expenses, when, in fact, Sadleir intended to use and did use a significant portion of the funds for personal and non-business-related expenses.

Sadleir has been charged with wire fraud, bank fraud, making false statements to a financial institution, and making false statements to the Small Business Administration.

Sadleir caused applications for PPP loans to be submitted to JPMorgan Chase on behalf of Aviron Group, LLC; Aviron Licensing, LLC; and Aviron Releasing, LLC dba Regatta. The bank approved the loans, and Sadleir received more than $1.7 million. “[I]mmediately upon receiving the funds a significant amount was diverted to Sadleir’s personal accounts and used for personal expenses,” the complaint alleges.

Sadleir was terminated from Aviron Pictures in late 2019, and people associated with the film production company told investigators that Sadleir currently had no role in Aviron Pictures or the related entities, according to the affidavit, which notes that Aviron Group, Aviron Licensing and Aviron Releasing are not engaged in any ongoing operations.

Authorities have linked Sadleir to the three PPP loan applications made on behalf of the three Aviron entities. All three applications claimed each company had 33 employees and monthly payroll expenses of well over $200,000. On April 30, JPMorgan Chase approved the loan applications, and the next day money was wired to nearly empty JPMorgan Chase bank accounts associated with the three entities.

Within days, nearly $1 million of the PPP loan money was transferred into Sadleir’s personal account at JPMorgan Chase, the affidavit alleges. Investigators have determined that some of this money was used to pay personal expenses, including payments to Sadleir’s and his wife’s American Express cards. One payment allegedly made with PPP loan proceeds – a $40,000 payment on Sadleir’s car loan – was reversed and JPChase Morgan froze the accounts associated with the alleged scheme.

The four charges alleged in the criminal complaint collectively carry a maximum statutory penalty of 82 years in federal prison.