The United States Department of Justice logo. (Department of Justice via Bay City News)

A CEO of four technology and IT companies in the Bay Area was sentenced to two years in prison for conspiracy to commit bank fraud and failure to pay over $2 million in employment taxes, federal prosecutors said Aug. 25.

Kishore Kethineni of Dublin pleaded guilty to these charges in February, admitting he conspired with his two brothers to engage in a scheme in which they fraudulently obtained over $3.1 million in loans under the Paycheck Protection Program (PPP), the U.S. Attorney’s Office for the Northern District of California said in a statement.

Federal prosecutors said that from April 2020 to May 2021, Kethineni and his brothers made false representations and gave fake payroll data and records to obtain loans and loan forgiveness under the PPP. The program provides forgivable loans through third-party lenders to small businesses for payroll and other expenses as part of a COVID-19 pandemic relief program by the Small Business Administration.

Kethineni and his brothers, who also own tech companies, were able to obtain over $3.1 million in PPP loans. FBI investigators discovered Kethineni used most of these funds for himself and his family members, instead of using the loans for payroll and other authorized business expenses under the program, federal prosecutors said.

The CEO also admitted to intentionally failing to account for and pay over employment taxes that his company, Neelinfo Incorporated, had withheld from the salaries of its employees, incurring an employment tax liability of over $2 million from 2014 through 2018, the U.S. Attorney’s Office said.

Besides Neelinfo, Kethineni also owned and led BiteGate Incorporated, Dinenamics Incorporated and TechPMC Incorporated.

Kethineni was mandated to serve two years of supervised release after his two-year prison term, pay a total of $3,295,514.25 in restitution and pay a $15,000 fine. The court also ordered the entry of a money forfeiture in the amount of $3,186,315.00, federal prosecutors said.