Thomas Smith, Stephen Smith, Samuel Davis Jr., Robert Hamilton, and Jonathan Henley were indicted for an alleged scheme to fraudulently obtain more than $1.1 million in PPP loans. A PPP loan is a Small Business Authority-backed loan that helps businesses keep their workforce employed during the COVID-19 crisis. Celestine Coletta Strong, Jawuan Polk, Patrick Earl Lewis, and Tyzhaun Marqui Lewis were charged in connection with a scheme to fraudulently obtain PPP funds. Related:Why the Small Business Administration loan program frustrates borrowers, Previous PPP stories: Augusta-area physicians, clinics also able to tap into PPP loans, Database: Click here to search our PPP loan database, Biden extends to Paycheck Protection Program, President Joe Biden has signed a bill extending the Paycheck Protection Program and is "pushing lenders to raise their game," in the wake of the coronavirus pandemic. Three-State Ring (Georgia, Ohio and California August 6), 32. In fact, the majority (68%) of the loans were under $50,000, which sounds right for most small businesses which tend to be pretty small, and the self-employed. For a quick overview, this infographic tells the story of what happens when the funds are misused in a PPP loan fraud. In August 2021, Ms. VanPelt pled guilted to bank fraud related to submitting six fraudulent PPP loan applications on behalf of six companies she owned or controlled. Allegedly he submitted fake IRS 1099 Forms containing worker social security numbers that were invalid. In addition to fraud, this could have been for a variety of reasons, including companies that owe money to the government and are in a federal Do Not Pay database, or companies that received more than they should have. Their alleged greed affects every American taxpayer, and the FBI is making every effort possible to stop it and make sure PPP funds are used as intended., When tragedy strikes and citizens find themselves in a vulnerable situation to no fault of their own, the influx of government assistance unfortunately also attracts criminals, said IRS-Criminal Investigation Special Agent in Charge James E. Dorsey. At the time of his arrest Hayford was a Project Manager for Walmart. If there is evidence of fraud, people can go to jail for a $20,000 PPP loan, just like someone whose PPP loan was $100,000 or $1 million. Bern Benoit, 45, of Burbank, California, pleaded guilty on March 11, 2021 to one count of conspiracy to commit bank fraud and wire fraud in connection with the loan obtained by his business, Transportation Management Services Inc. Benoits sentencing is set for September 8, 2021 before Judge J.P. Boulee. While egregious and clear misuse of PPP loan funds presents a clear risk, expenditures that blend business and personal purposes (i.e. For further information please contact the U.S. Attorneys Public Affairs Office at USAGAN.PressEmails@usdoj.gov or (404) 581-6016. The defendants allegedly abused both programs by submitting fraudulent applications and obtaining thousands of dollars that should have gone to support struggling businesses. A package containing methamphetamine hidden in dog food containers had been mailed to Quartermans home. I was put on furlough for almost 2 months from mid April to end of June. Bank Fraud (18 U.S.C. NEWNAN, Ga. - Ten defendants, who operated as part of a larger group, have been indicted for participating in a wide ranging, multi-state scheme to submit fraudulent loan applications on behalf of non-existent businesses as part of the Economic Injury Disaster Loan (EIDL) program and the Paycheck Protection Program (PPP). The Form 941s, bank statements, and W2 payroll spreadsheets had all been fabricated. Have a question about Government Services? Copyright 2003 - 2023, Small Business Trends LLC. PPP2 started accepting applications on January 11, 2021. Heres a list of the PPP loan prosecutions to date: 1. An official website of the United States government. Kao allegedly transferred $2 million to personal accounts. Oludamilare Olugbuyi was charged with fraudulently obtaining two PPP loans totaling more than $400,000. However, the Government watchdog also recommended oversight of the 4 million smaller loans. It is not intended as legal advice. Keith William Nicolettawas charged with seeking more than $1.9 million in a Paycheck Protection Program loan to pay employees of a scrap metal company when, in fact, he had paid no payroll taxes for employees. He received $593,590. The government wisely decided to move fast and let the justice system track down any miscreants. Search our database that is tracking this information. Man Charged with Identity Theft (Florida August 10), 34. The technical storage or access that is used exclusively for anonymous statistical purposes. According to the SBA, the Paycheck Protection Program ended on . All rights reserved. Related coverage:Treasury names 650K small businesses receiving govt loans. Allegations also claim he perpetrated a credit card scam on low-income patients by getting them to pay for medical expenses for services he did not fully render. Apparently one tim isnt enough for some people. 18, 2021 at 1:24 PM EDT Under the terms of the program, for example, companies must represent that: During a federal PPP loan fraud audit or investigation, federal agents will not just be looking to assess loan recipients eligibility, but they will also be looking to determine whether companies have documentation on hand to qualify the representations they made in their PPP loan applications. The PPP loan applications reported that each business had between 59 and 69 employees and approximately $295,000 to $342,000 in average monthly payroll expenses. Then he allegedly used $689,000 to buy a luxury catamaran yacht. They allegedly discussed their fraud in email and one assumed the identity of his own brother. Glad theyre doing the work to clean it up and recover some of these funds. At Oberheiden P.C., our attorneys and former federal agents are intimately familiar with the federal auditing and investigative processes. Call 888-680-1745 for Central Intake with Dr. Nick Oberheiden Criminal Law & Process, PPP fraud What are the Red Flags for PPP Loan Fraud? Prominent CEO of Hawaii Government Contractor (Hawaii -September 30), 55. He then went on a buying extravaganza, spending on a Tesla, a Bentley, two condominiums, and paying his home mortgage. Attorneys for the Northern District of Georgia, Twenty-two defendants charged in connection with alleged $11.1 million Paycheck Protection Program fraud scheme, https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form, Arizona man pleads guilty to extorting Georgia Tech, Georgia woman charged with stealing over $450,000 in government and retirement benefits. McQuarn allegedly used the cash for personal use including buying a 26-foot Pavati Wake Boat and a Rolls Royce. Transferred $335k to Personal Accounts (California -October 29), 63. But the program attracted a few rotten apples that committed PPP loan fraud. A PPP loan is a Small Business Authority-backed loan that helps businesses keep their workforce employed during the COVID-19 crisis. On January 4, 2021, the DOJ announced that Georgia resident Hunter VanPelt, also known as Ellen Corkrum, was sentenced to nearly 3.5 years in prison (41 months) for PPP loan fraud. Researchers estimate that $76 billion in PPP loan money was taken illicitly. Or do you want to know whichcompanies got taxpayer-fundedloans? Related:Why the Small Business Administration loan program frustrates borrowers, Previous PPP stories:More than 5,000 PPP loans, totaling more than $200m, approved in Clarke County, Database: Click here to search our PPP loan database. The Feds froze his bank account and recovered $402,000. Game of Thrones Inspired These Fake Company Names (North Carolina September 29), 54. FBI Assistant Director William F. Sweeney Jr said: The benefits offered by the CARES Act for PPP loans were established to help small business owners survive during the pandemic. If an applicant knowingly answers any of these questions falsely, it may face False Claims Act liability.. You can also check to see how many workers companies receiving the assistance said they kept on the payroll. The CARES Act was signed to provide economic assistance to keep companies afloat while navigating through these uncertain times, said Tommy D. Coke, Inspector in Charge of the Atlanta Division. On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. He allegedly received $17.3 million and spent the money on a Bentley convertible as well as sending millions of dollars abroad. 2023 Cox Media Group. Stephen J. Cox, the U.S. Attorney for the Eastern District of Texas, wrote in an op-ed in Texas Lawyer: Rest assured that we will be careful not to discourage legitimate businesses from accessing the important financial resources that Congress made available through the CARES Act. The government issued a seizure warrant for a Mercedes Benz SUV and more than $500,000 from a bank account. A $106K Mercedes and a Ford F-250 (Florida October 23), 61. He then went on a luxury buying blitz acquiring a Lamborghini Urus, a Rolex watch, a 2020 Ford F-350 pickup truck, and real estate according to allegations. IRS-CI will continue to help illuminate these criminal deeds with our financial expertise., The Treasury Inspector General for Tax Administration aggressively pursues those who endeavor to defraud programs afforded to the American people under the CARES Act, said J. Russell George, the Treasury Inspector General for Tax Administration. (March 30), Consolidated Augusta government's American Rescue Plan payment doubles to $84 million, Why the Small Business Administration loan program frustrates borrowers, Augusta-area physicians, clinics also able to tap into PPP loans, Click here to search our PPP loan database, Your California Privacy Rights/Privacy Policy. Authorities claim he also invested millions in the stock market in the name of his spouse. Man Couldnt Keep His 19 Fraudulent Applications Straight (Michigan September 1), 44. 1343) and making false statements to the SBA and FDIC-insured banks (18 U.S.C. I was not hired back. How does the government miss a well know con artist? Lauren Marcel Duhart, Joshua Bernard Smith, Steve Ronald Lewis, Christopher J. Agard, Henry Duffield, Jeremy Brandon Latourneau, Derick Keane were charged in an indictment with laundering $750,000 obtained fraudulently, including over $390,000 from a PPP loan. Rodericque Thompson allegedly recruited Micah Baisden, Travis Crosby, Keith Maloney, Tabronx Smith, and Thomas Wilson to apply for PPP loans on behalf of their respective business, per law enforcement. Argires allegedly filed two fraudulent PPP applications seeking $1.1 million in forgivable funding. We have not conducted an exhaustive review of every sentence that federal courts have already imposed in PPP loan fraud cases as of November 15, 2021. Authorities state Bellamy allegedly obtained a Paycheck Protection Program loan of $1,246,565 for his own company, Drip Entertainment LLC and then spent the proceeds on purchases at Dior, Gucci, and jewelers as well as withdrawing $302,000 in cash. In order to ensure that no one at your company raises questions for federal authorities unnecessarily, it is imperative to rely on the advice and representation of experienced federal counsel. On Jan. 4, a Georgia woman, who submitted six fraudulent PPP loan applications for Georgia Nephrology Physician Associated, United Healthcare Group & Co., Nephrology Network Group LLC,. Subsequently they are looking for numerous specific red flags during audits and investigations, and companies must look for these same red flags when conducting their internal PPP compliance investigations as well. The Vegas High Roller (California July 16), 26. This alleged PPP ring paid each other for services never rendered to try to hide the money trail. Thats a great point, Alex! Fraudulent Loans List :: PPP Detective Fraudulent Loans List These loans have been flagged by other users as potentially being fraudulent. Five Charged in Connection With PPP Loans Scheme (Wisconsin/Illinois October 22), 60. The criminal complaints describe egregious CARES Act abuse, assuming the government ultimately proves the allegations. What are the Red Flags for PPP Loan Fraud? Learn about careers at Cox Media Group. Court documents identify 3 confidential human sources, i.e., informants. Then turns around and starts writing checks to Lamborghini dealerships. Meghan Thomas, 32, of Alpharetta, Georgia, is charged with conspiracy to commit bank fraud and wire fraud, bank fraud, wire fraud, and false statements to a federally insured financial institution in connection with her involvement in several businesses loans. Handmade Entrepreneur (Arkansas July 16), 27. The maximum that one person can get for a PPP loan is $20,833. Georgia has a total of 553,322 businesses that received Paycheck Protection Program (PPP) loans from the Small Business Administration. Specifically, if and when Firm cooperates with Local Counsel, Firm will disclose the details to the client in writing for their approval. This federal statute imposes penalties of up to a $1 million fine and 30 years of federal imprisonment for, "knowingly execut [ing], or attempt . Charged were: Darrell Thomas, Andre Lee Gaines and Carla Jackson of Georgia; Kahlil Gibran Green Sr. of Ohio; and Bern Benoit of California. Attorneys, including the Fraud Section, have resulted in a variety of charges, including wire fraud (18 U.S.C. After obtaining a second search warrant for the cell phones, USPIS inspectors uncovered hundreds of text messages and photos related to an additional crime, fraudulent EIDL and PPP business loans. The COVID-19 pandemic has caused financial hardships for many hardworking business owners across the nation. Claimed to Have Paid 100 Employees (Florida September 17), 52. Thomas is from Duluth. Joseph Cherry II of Virginia was indicted on 10 counts of COVID fraud and faces 10 to 30 years of prison time on each count. Check with your attorney and/or accountant with questions. 1344. William Sadleir, the ousted head of Aviron Pictures, was charged with wire and bank fraud in connection with a $1.7 million PPP loan. Former Mayoral Candidate Charged with Obtaining Fraudulent $323,000 PPP Loan - In March 2021, the DOJ charged a former mayoral candidate in Georgia with fraudulently obtaining in excess of . Justice Department representatives say honest owners acting in good faith shouldnt worry. 11, 2021 confidential human sources, i.e., informants 650K Small businesses receiving loans! 335K to personal accounts $ 402,000 obtaining thousands of dollars abroad ),.! 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