The former owner of the Budlong Hot Chicken chain and other restaurants in Chicago and Denver has been sentenced to 30 months in federal prison after admitting to fraudulently obtaining more than $2.3 million in COVID relief funds and failing to pay more than $430,000 in taxes withheld from his employees.
Jared Leonard, 45, of Littleton, Colorado, was sentenced this month by U.S. District Judge Edmond E. Chang in Chicago. Chang also ordered him to pay nearly $2.8 million in restitution to the IRS and the United States Small Business Administration, according to federal prosecutors.
According to a government sentencing memorandum, Leonard filed at least ten fraudulent applications for Paycheck Protection Program and Economic Injury Disaster Loan funds between April 2020 and March 2021, each of which contained false information about his businesses, such as employee counts, payroll expenses, gross revenue, and whether the businesses were operating.
Rather than using the funds to help his restaurants and employees during the pandemic, Leonard spent the majority of it on personal expenses, such as the purchase of a spacious home on more than seven acres in Evergreen, Colorado, vehicles, and overseas travel.
Just days after obtaining more than $1 million from his first three fraudulent PPP loans, Leonard signed a contract to buy the Colorado property and informed the other parties involved that he was “considering doing this deal with all cash,” according to the memorandum. He spent at least $63,000 on house modifications, which included $5,200 for a mattress.
According to the government, Leonard used COVID funding to purchase a $31,500 recreational vehicle and a $74,000 Ford F-450 pickup truck. He also spent the money on food and petrol, as well as more than $5,600 in Las Vegas and more than $15,000 at the Four Seasons and other Vail places. According to prosecutors, he spent more than $12,000 at the Four Seasons and other locations in Punta Mita, Mexico, in October 2020.
The sentencing statement also stated that Leonard neglected to pay federal income, Social Security, and Medicare taxes withheld from his employees. Over a 15-month period, the underpaid withholdings allegedly amounted over $430,000.
In November 2024, he was indicted in Cook County for sales tax evasion and related crimes. After failing to appear in court two months later, he was served with an arrest warrant. According to the memorandum, Colorado officials eventually confiscated several of Leonard’s eateries due to unpaid taxes. Disgruntled employees informed authorities that Leonard lived in Mexico and owned a restaurant. Leonard was eventually apprehended by Mexican officials and transported to Denver before being transferred to federal detention in Illinois.
According to news reports, Leonard sold the Budlong Hot Chicken restaurant franchise in 2022.
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