ROCHESTER, N.Y. (WROC) — A North Chili man was convicted on Tuesday on 37 counts of COVID relief fraud for trying to obtain almost a million dollars to pay employees who did not exist.

According to the U.S. Attorney’s Office, 49-year-old Michael Rech was the CEO of the nonprofit organization Guardian of Humanity Inc. and was the only member of the limited liability company Eclipse.

Prosecutors said that Rech applied for eight Payroll Protection Program(PPP) loans, falsely claiming he needed the money to pay employees.

The PPP allows organizations to receive loans to be used for payroll costs, mortgage interests, rent, and utilities. and will forgive the principal and interest if the money is spent within a period of time and to use some towards payroll. This program is one source of COVID-19 relief through the CARES Act.

Rech initially sought $880,000 in loan funds and ended up receiving three loans totaling around $277,500. When he received the money, he took out amounts less than $10,000 from the bank to avoid federal reporting requirements.

An investigation revealed that neither of Rech’s companies had employees and that he himself was collecting unemployment benefits. The IRS recovered all of Rech’s funds from his home and bank account.

Michael Rech now faces charges of bank and wire fraud, as well as money laundering. He faces a maximum penalty of 30 years in prison and a $500,000 fine. His sentencing is scheduled for March 27, 2023.