Former Nye County Commissioner Indicted on Wire Fraud, Money-Laundering Charges in COVID Relief Scheme

A federal grand jury in Las Vegas indicted former Nye County Commissioner Leonardo F. Blundo on March 11 on charges that he fraudulently collected more than $500,000 in COVID-19 relief funds meant for his Pahrump restaurant, Carmelo's Bistro, then diverted the money into personal investment accounts and cryptocurrency.

Blundo, who served on the Nye County Commission from 2019 through 2022 after winning election in 2018, faces five counts of wire fraud and two counts of money laundering. Prosecutors allege that between March 31, 2020, and September 6, 2021, he submitted false applications to three federal Small Business Administration relief programs: the Paycheck Protection Program, the Economic Injury Disaster Loan program, and the Restaurant Revitalization Fund. He allegedly inflated Carmelo's Bistro's gross revenue, average monthly payroll, and number of employees across those applications, and bolstered the claims with fabricated profit and loss statements and tax returns.

The scheme, according to the indictment, produced two PPP loans, two EIDLs, and one RRF grant. Rather than directing the funds toward permitted business purposes, prosecutors allege Blundo transferred more than $200,000 into personal investment accounts and put more than $25,000 into cryptocurrency. If convicted, prosecutors are seeking forfeiture of at least $545,000.

Blundo's initial appearance in federal court is scheduled for March 24 before U.S. Magistrate Judge Daniel J. Albregts. The statutory exposure is severe: up to 120 years in prison, three years of supervised release, a $1,750,000 fine, and a $700 special assessment.

Executive Assistant U.S. Attorney Summer Johnson announced the indictment on behalf of the District of Nevada. Assistant U.S. Attorney Richard Anthony Lopez is prosecuting the case, which was investigated by the FBI's Las Vegas Field Office and is being handled through the District of Nevada's Public Corruption Strike Force, a unit that focuses specifically on crimes affecting government integrity.

FBI Las Vegas Special Agent in Charge Christopher S. Delzotto said in a statement: "Fraud will not be tolerated in our community, regardless of the position or identity of those involved. Fraud erodes public trust and undermines the institutions our communities rely on every day. The FBI remains committed to protecting the integrity of our public institutions and ensuring that no one is above the law."

Blundo, who has owned Carmelo's Bistro since 2007 and currently serves as chair of the Nye County Republican Party, declined to comment when reached by phone. Through spokeswoman Lisa Mayo-DeRiso, however, he issued a written statement saying he was "shocked and angry with the unfounded charges" and maintained that his conduct did not rise to the level of federal criminal liability. "My actions were not criminal in nature, and would best be dealt with under the ethics laws of Nevada and NRS281A," he said. "I will ardently defend myself in this matter."

The federal indictment is not the first time Blundo has faced scrutiny over pandemic-era funds. A prior ethics investigation found that he voted in favor of amendments to Nye County's CARES Act policy that directly increased the amount of funds his business received. An ethics commission spokesperson stated at the time: "Mr. Blundo voted in favor of the amendments to Nye County's CARES Act policy, which had the direct effect of increasing the amount of funds that his business received." That investigation also found that some county staff members quit after Blundo allegedly pressured them to expedite his pandemic aid applications. He was separately arrested on state charges, including misconduct of a public officer, attempted misconduct of a public officer, unlawful commissions, and personal profit and compensation by a public officer, after turning himself in to the Nye County Sheriff's Office. Sheriff Sharon Wehrly's office said those charges stem from a complaint that Blundo was "involved in decisions that provided him a personal, pecuniary, monetary gain," and noted that he had disclosed his business interest in at least one commission meeting before voting to approve the relevant items anyway.

The federal case now moves Blundo's legal exposure into an entirely different category, with prosecutors from the Public Corruption Strike Force pressing charges that carry potential penalties far exceeding anything available under state ethics or misconduct statutes.