Doctor used COVID loan for down payment on $1.7M yacht, officials say

A doctor in New York was sentenced to 51 months in prison Friday after he fraudulently obtained more than $3 million in COVID emergency loans, officials said.

NEW YORK (WPIX) – A doctor in New York was sentenced to 51 months in prison Friday after he fraudulently obtained more than $3 million in COVID emergency loans, officials said.

Dr. Konstantinos Zarkadas used the money to buy a $1.7 million yacht, lease luxury automobiles and get Rolex and Cartier wristwatches, according to U.S. Attorney’s Office for the Eastern District of New York. He pleaded guilty in November 2021 to disaster relief fraud and wire fraud in connection with his receipt of small business loans under the Paycheck Protection Program and Economic Injury Disaster Loan Program.

“Today’s sentence demonstrates there are consequences for those who treat vital government programs as cash give-a-ways and shamefully seek to profit from an unprecedented public health crisis,” United States Attorney Breon Peace said in a Friday press release. “This Office will vigorously prosecute and bring to justice medical professionals like the defendant and other fraudsters who are driven by greed to maintain a lavish lifestyle at the expense of small businesses in legitimate need of COVID-19 emergency assistance.”

Zarkadas, 48, fraudulently applied for and received at least 11 loans between March and July of 2020, officials said. He then laundered the money and used it for "extravagant personal purchases," including a nearly $200,000 down payment on a yacht.

“Thanks to the investigative work of IRS-CI and the FBI, he’ll sail straight to federal prison instead of onboard his $1.7 million yacht that was illegally purchased with CARES Act funds," said Thomas Fattorusso, Jr., Special Agent-in-Charge of IRS Criminal Investigation (IRS-CI) of New York.

In addition to his 51-month sentence, Zarkadas has been ordered to pay approximately $3.5 million in restitution.