An Orange County man accused of fraudulently obtaining more than $5 million in COVID-19 relief loans for three sham companies but who used the money for a home in Malibu, an investment property in Los Angeles and other personal expenses will plead guilty to federal criminal charges, prosecutors announced Friday.

Reddy Raghav Budamala, 35, of Irvine, has agreed to enter his plea to one count each of bank fraud and money laundering on June 21, according to the U.S. Attorney’s Office.

The charge carries a sentence of up to 40 years in federal prison.

Budamala has been in federal custody since his arrest on Feb. 23, when he attempted to abscond from the United States to Mexico via the San Ysidro border crossing, according to federal prosecutors.

Budamala used the relief loan money to pay for personal expenses, including the purchase of a $1.2 million investment property in Los Angeles, $597,585 on a Malibu property, a $970,000 investment in an EB-5 Immigrant Investor Visa Program and a nearly $3 million deposit into Budamala’s personal TD Ameritrade account, prosecutors said.

In 2019, he formed or acquired three shell companies with no operations — Hayventure LLC, Pioneer LLC, and XC International LLC, according to court papers.

Following the outbreak of the COVID-19 pandemic, and the enactment of federal programs designed to address the subsequent economic fallout, Budamala allegedly submitted to the Small Business Administration seven applications for pandemic-relief loans under the Paycheck Protection Program and Economic Injury Disaster Loan.

In the applications, Budamala falsely represented to the banks administering the pandemic relief business loan programs that his companies employed dozens of individuals and earned millions of dollars in revenue, and that he needed the money for payroll and business expenses, prosecutors allege.

The listed addresses for the companies were bogus, nonexistent or residential.

The SBA and the banks funded six of the loans and disbursed more than $5.15 million, an affidavit states. Budamala allegedly applied to have several of the loans forgiven and falsely represented that he had used the SBA money entirely for payroll.

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