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 he fraudulently obtained more than $2.3 million in COVID relief funds and failed to turn over 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 approximately $2.8 million in restitution to the IRS and U.S. Small Business Administration, federal prosecutors said.
Leonard submitted at least 10 fraudulent applications for Paycheck Protection Program and Economic Injury Disaster Loan funds between April 2020 and March 2021, each containing false information about his businesses, including employee counts, payroll expenses, gross revenue and whether the businesses were operating, according to a government sentencing memorandum.
Rather than using the money to support his restaurants and employees during the pandemic, Leonard used most of it for personal expenses, including the purchase of a sprawling home on more than seven acres in Evergreen, Colorado, vehicles and international travel.
Just days after receiving more than $1 million from his first three fraudulent PPP loans, Leonard signed a contract to purchase the Colorado property and notified other parties involved in the transaction that he was “considering doing this deal with all cash,” the memorandum said. He spent at least $63,000 on improvements to the home, including $5,200 for a mattress.
The government said Leonard also used COVID funds to buy a $31,500 recreational vehicle and a $74,000 Ford F-450 pickup truck. He also used the money for everyday expenses at restaurants and gas stations, as well as more than $5,600 in purchases in Las Vegas and more than $15,000 at the Four Seasons and other locations in Vail. He spent more than $12,000 at the Four Seasons and other locations in Punta Mita, Mexico, during October 2020, prosecutors said.
The sentencing memorandum also said Leonard failed to pay federal income, Social Security and Medicare taxes withheld from his employees. Over 15 months, the unpaid withholdings allegedly totaled more than $430,000.
He was indicted in Cook County in November 2024 on sales tax evasion and related charges. A warrant was issued for his arrest after he failed to appear in court two months later. Before long, Colorado authorities seized several of Leonard’s restaurants for delinquent taxes, the memorandum said. Disgruntled employees told law enforcement that Leonard was living in Mexico and operating a restaurant there. Leonard was ultimately located and detained by Mexican authorities and removed to Denver before being transferred to federal custody in Illinois.
News reports indicate Leonard sold the Budlong Hot Chicken chain in 2022.
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