Paycheck Protection Program (PPP) loans have aided more than 5.2 million small business owners, providing a much-needed lifeline during the Coronavirus outbreak crisis. Geoffrey M. Palermo of Novato faces charges of wire fraud and making false statements. Honestly, I think theyll be finding and prosecuting these for years. 1014). 1344) - Along with 18 U.S.C. Authorities revealed they recovered $1.3 million of the funds. According to the U.S. Now they are getting another PPP Loan to go on more trips and buy more things for themselves.They posted on their Facebook all their trips and everything they bought.They went from renting a house to buying a house in cash.They dont even have EmployeesWow this is wrong. For further information please contact the U.S. Attorneys Public Affairs Office at USAGAN.PressEmails@usdoj.gov or (404) 581-6016. Michael C. Moller was charged with fraudulently seeking $4.7 million in PPP forgivable loan that he applied for in the name of various people including his father, girlfriends brother and girlfriends son. He allegedly bought a 2020 Mercedes and a special edition Ford F-250 pickup truck, and wired $537,000 to a property management company in south Florida. Attorneys, including the Fraud Section, have resulted in a variety of charges, including wire fraud (18 U.S.C. Court documents identify 3 confidential human sources, i.e., informants. Applied for PPP Loan While out on Bail (Tennessee November 9), 64. Thissearchable website looks at which companies got money from last year's federal program to help businesses retain their workers amid the pandemic economic shutdown. This station is part of Cox Media Group Television. See how PPP works. Another source of relief from the March 2020 CARES Act is the PPP which allows qualifying small businesses and other organizations to receive PPP loans to pay payroll costs, interest on mortgages, rent, and utilities. Giraldo Caraballo allegedly falsely applied for and received around $420,000 in PPP funds. However, in conjunction with the submission of an EIDL application, by having clicked on and checked a box within the on-line application, an applicant could request and then receive up to $10,000.00, an EIDL Advance which did not have to be repaid. Along with Lawson and Quarterman, the federal indictment includes: Charges against the named co-conspirators include various counts of bank fraud, mail fraud, wire fraud, conspiracy to commit wire fraud, and money laundering for a total of approximately $714,000, prosecutors said. In April he allegedly obtained a PPP loan of $1.7 million by falsely certifying that GMP Cars had staff for whom it paid salaries and payroll taxes. Handmade Entrepreneur (Arkansas July 16), 27. Sum of Undisburse Amount. The COVID-19 pandemic has caused financial hardships for many hardworking business owners across the nation. He received $593,590. [SIGN UP: WSB-TV Daily Headlines Newsletter]. Darrell Thomas, 35, of Duluth - pleaded guilty on June 16, 2021 to one count of conspiracy to commit bank fraud and wire fraud and one count of money laundering. Restaurant Owner and Son Charged ( North Carolina December 17), 75. Andrew Marnell of Los Angeles is charged with bank fraud. 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. The U.S. Secret Service and IRS participated in this investigation, along with the U.S. Attorney for the Southern District of Florida. But they apparently werent creative enough, as they submitted nearly identical applications each with 16 employees, and used identical fraudulent quarterly tax returns. A .gov website belongs to an official government organization in the United States. But keep it all in perspective. Allegedly he submitted fake IRS 1099 Forms containing worker social security numbers that were invalid. Man Couldnt Keep His 19 Fraudulent Applications Straight (Michigan September 1), 44. In some cases, pursuant to Rule 7.04 of the Texas Disciplinary Rules of Professional Conduct and the equivalent in other jurisdictions, a case is referred to a Local Counsel, the Firm will not participate in the representation. 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. Have a question about Government Services? Prominent CEO of Hawaii Government Contractor (Hawaii -September 30), 55. The government wisely decided to move fast and let the justice system track down any miscreants. To speak with one of our senior federal compliance and defense attorneys in confidence, call 888-680-1745 or request a free PPP risk assessment online now. Sandra D. Smith has been arraigned on federal charges of wire fraud and theft of government funds. 1343) and making false statements to the SBA and FDIC-insured banks (18 U.S.C. He then went on a buying extravaganza, spending on a Tesla, a Bentley, two condominiums, and paying his home mortgage. Rocco A. Malanga, owner of a New Jersey small company, was charged with wire and bank fraud for falsifying records to obtain $1.8 million in PPP loans. Look up the extravagant purchases of the nations record setting check kiter Adam W****man. I was put on furlough for almost 2 months from mid April to end of June. Based on the investigation, none of the companies allegedly engaged in any business-related transactions or used the PPP loan proceeds for any authorized purposes. He allegedly certified that his business was operating as of February 15, 2020 (a requirement of the law) and had 247 employees, but didnt even set up a company entity until a few days before applying for the PPP loan. US Attorney's Office for Middle District of Ga. investigates high volume of PPP loan fraud By Jessie Gibson Published : Jun. - Federal Lawyer We Will Protect Your Rights, Reputation and Freedom. Tristan Bishop Pan was charged for allegedly seeking $6 million in Paycheck Protection Program loan. We will work tirelessly to protect the integrity of the EIDL and PPP and to help small businesses stay afloat., The COVID-19 pandemic has caused financial hardships for many hardworking business owners across the nation. A package containing methamphetamine hidden in dog food containers had been mailed to Quartermans home. An official website of the United States government. In July, the Feds seized $866,019 from his bank accounts. This case is being investigated by the Federal Bureau of Investigation, the Internal Revenue Service-Criminal Investigation, the U.S. Treasury Inspector General for Tax Administration, and the Small Business Administration-Office of the Inspector General. The DOJ has already initiated multiple federal cases against individuals alleged to have converted PPP loan funds for personal use, and in these cases the defendants are facing hefty fines and years, if not decades, of federal imprisonment. Sum of Current Approval Amount. The loan applications for each company were between $700,000 and $850,000. Medical Company Owner (Florida July 10), 23. These are significant questions, and they are questions that you need to answer sooner rather than later. He allegedly lied about not being under criminal charges he in fact was under indictment for a bribery scheme. Former Police Officer Sentenced For Money Laundering. Moller received close to $600K in stimulus PPP loan. 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. Hopefully someone will find this. 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. Not consenting or withdrawing consent, may adversely affect certain features and functions. Rahul Shah of Evanston is charged with bank fraud and making false statements to a financial institution. Stopping COVID-related fraud is a priority for the Department of Justice. See the SBA website for updated forgiveness information. Sum of Forgiven Amount. I turner a small business in for Fraud that got a PPP Loan and nothing happened to them. Ten people indicted in Metro Atlanta, Houston and D.C.-Maryland area on federal fraud charges for false CARES Act applications. The provisions of the CARES Act, in conjunction with an officially declared disaster by the United States Government, allowed the Small Business Administration (SBA) to offer EIDL funding to business owners negatively affected by COVID-19. Diamond Blue Smith, a recording artist, is charged with being part of the nationwide $24 million scam ring mentioned above. On August 9, Manukyan allegedly boarded a flight from Mexico City to Belarus. Our searchable databaseallows users to look up dollar allotments by industry, and lenders. Assistant U.S. The False Claims Act can impose steep financial penalties, including treble damages. Hubert Ivan Ugarte of Draper, with the assistance of Lisa Bradshaw Rowberry of Provo are charged with fraudulently obtaining a PPP loan of $210,000. Providing false statements to gain access to SBAs programs will be aggressively investigated by our office, said Hannibal Ware, Inspector General of the U.S. Small Business Administration, in a statement. 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. It is alleged he got over $190,000 in proceeds and managed to withdraw cash or cashiers checks for $140,000. Around 1.8 million of the PPP's 11.8 million loans showed signs of fraud, according to an academic working paper cited by The New York Times. They allegedly discussed their fraud in email and one assumed the identity of his own brother. The U.S. Department of Justice say that approximately $11.1 million in PPP loans were taken and the funds were then used to buy luxury vehicles, jewelry, and other personal items. The charges allege he applied several times to get aid totaling $3 million, in the names of businesses with no actual operations. The charges reinforce our resolve to prosecute anyone who used pandemic relief funds for personal gain., So many businesses needed federal emergency assistance to stay afloat during a pandemic, and these defendants allegedly misdirected millions of dollars of that assistance money to their own pockets for luxury items, said Chris Hacker, Special Agent in Charge of FBI Atlanta. The GAO also recommended auditing COVID-19 unemployment benefits paid to workers rehired through the loans. Days later she paid $8,000 on her student loan and then went on a spending spree at Sephora and other retailers, it is alleged. Michael George McQuarn, 51, of Austin, is charged with with fraudulently receiving over $2 million in Small Business Administration loans for two fictitious companies, Vantastic Voyages, LLC and Happy Days Movers, LLC. 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. Ronald Bell, who conspired to extort money from Georgia Institute of Technology, has pleaded guilty to a charge of conspiracy to commit extortion. Both are fraud. The Cryptocurrency Investor (Texas July 14), 25. The bank recalled one loan and the Government seized funds for the other two. And the DOJ has made it a priority to root them out. A Porsche and Lamborghini (Texas November 17), 68. The complaint alleges he ultimately received a loan for over $1 million. While this information may constitute attorney advertising in some jurisdictions, merely reading this information does not create an attorney-client relationship. All rights reserved. He allegedly laundered funds he received by writing checks for $8,330 each to 23 people. All rights reserved. Millions of Americans eventually will apply for forgiveness. 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? Anecdotally, however, courts are routinely handing down . A PPP loan is a Small Business Authority-backed loan that helps businesses keep their workforce employed during the COVID-19 crisis. Consenting to these technologies will allow us to process data such as browsing behavior or unique IDs on this site. Arman Manukyan, a San Fernando Valley man, is charged with fraudulently obtaining an $867,000 loan for a shell sewing company, Argo Global. Auto Repair Shop Owner (California June 5), 11. 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. Which goes to show that most of the defendants arent very smart. The banks internal auditors will then report it to the SBA faster than you can say oops, bad move.. Acting U.S. Attorney Audrey Strauss said, Goyal allegedly looted over $630,000 in federal funds earmarked for legitimate small businesses in dire financial straits.. He is alleged to have bought a $400,000 house with taxpayer funds. Made Down Payments on Million Dollar Homes (California November 18), 69. More than 15% of PPP loans had at least one indication of potential fraud. They allegedly used the proceeds to make down payments on personal homes. Kao allegedly transferred $2 million to personal accounts. Fake IRS filings. The pair allegedly received $97,800 and $125,900 respectively. Depending on the charges, penalties could include up to $1 million in fines and up to 30 years in prison, legal experts say. This alleged PPP ring paid each other for services never rendered to try to hide the money trail. They allegedly discussed their fraud in email and one assumed the identity of his own brother. He was arrested after he booked a same-day flight to Pakistan. Authorities claims Yates used a name generator on the Internet to create names of fake staff. Six individuals, including the schemes mastermind, Darrell Thomas, have pleaded guilty. Obtaining more than one PPP loan (or stacking PPP loans) is prohibited, and companies that applied with multiple lenders could face allegations for attempting to stack PPP loans. 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. He got $5.6 million and sent hundreds of thousands of dollars to Pakistan accounts, and paid for luxury items. Shashank Rai, an engineer from Beaumont, is charged with multiple counts of fraud and false statements to the SBA for seeking more than $10 million in PPP loans. Georgia and South Carolina Fraud Ring with 11 People (Georgia, January 28, 2021). In connection with the investigation, the United States seized nearly $4 million in PPP loan proceeds, four luxury vehicles, and several jewelry items. And you wont believe how rotten they are. Owner of Private Investigation Firm (Ohio June 24), 18. Dwan Ashong a/k/a Dwan Gilpin, 40, of Jacksonville, Florida, is charged with conspiracy to commit wire fraud, wire fraud, and money laundering in connection with her involvement in several businesses loans. In reality, however, none of the businesses had employees or payroll expenses. Trucking Company Owner (Utah July 8), 22. As part of the court-authorized search, law enforcement seized Quartermans cell phones and discovered a handwritten ledger with the personal and banking information of several individuals. The overwhelming majority of small businesses have no allegations of Paycheck Protection Program fraud. Azhar Sarwar Rana, 30, of Newton, New Jersey, was charged for submitting a fraudulent application for a real estate development company, and falsified payroll data. Acknowledging PPP loan applicants compliance burdens (and the limited information that was initially made available to applicants), the U.S. Small Business Administration (SBA) offered a grace period within which companies could return improperly obtained PPP loans without penalty. Breast Ultrasound Screening Coming Direct to You! In order to account for all disbursements from their PPP loans, companies should deposit their loans into distinct accounts, and they should not commingle their PPP loan funds with any other company assets. The Form 941s, bank statements, and W2 payroll spreadsheets had all been fabricated. Ma is alleged to have falsely represented to the SBA and five financial institutions that his companies had hundreds of workers when he was the only employee. A Bentley Convertible and a Jaw Dropping Scheme (Texas October 9), 58. Uzoamaka Leonard Ohaebosim was charged for allegedly falsifying payroll documents to obtain $1.2 million for his movie company, Spite the Movie. Law enforcement recovered all the proceeds. Abramovs allegedly got nearly $2 million from seven lenders. The federal Paycheck Protection Program (PPP) is subject to a whole host of rules and restrictions. The defendants allegedly abused both programs by submitting fraudulent applications and obtaining thousands of dollars that should have gone to support struggling businesses. Days later he allegedly bought a 2020 Lamborghini Huracan sports car for $318,000. Joshua Thomas Argires of Houston was arrested on various fraud charges. After the PPP loan proceeds were deposited into the businesses accounts, the businesses transferred more than $5.5 million of the PPP loan proceeds into accounts controlled by Darrell Thomas, purportedly for rental payments and payroll. Fayne allegedly claimed he had 107 workers and submitted forged bank statements. 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. A crucial aspect of the PPP is that companies are only allowed to use the funds they receive for specific authorized purposes. To provide the best experiences, we use technologies like cookies to store and/or access device information. Melissa Turasky, a Chicago restaurateur, was charged with submitting a fraudulent PPP loan application to obtain more than $175,000 in a forgivable PPP loan. Special Agent in Charge Joseph R. Bonavolonta of the FBIs Boston Field Office said in a statement, Thankfully we were able to stop them before taxpayers were defrauded.. According to the SBA, thePaycheck Protection Program ended on May 31, 2021. After leaving the hotel he opened GMP Cars. Attorneys for the Northern District of Georgia, 10 defendants indicted in multi-state, fraudulent COVID-19 related business loan scheme, Arizona man pleads guilty to extorting Georgia Tech, Georgia woman charged with stealing over $450,000 in government and retirement benefits. The defendants allegedly participated in an extensive nationwide scheme in exchange for illegal kickbacks of portions of the loan proceeds, said Acting Assistant Attorney General Brian C. Rabbitt of the Justice Departments Criminal Division in a statement. If the PPP debt is not forgiven, the interest rate is very low 1%. Jesika Blakely, 34, of Atlanta, Georgia, is charged with conspiracy to commit bank fraud and wire fraud, bank fraud, wire fraud, false statements to a federally insured financial institution, and money laundering in connection with her involvement in several businesses loans. By using this website, you accept the terms of our Visitor Agreement and Privacy Policy, and understand your options regarding Ad Choices. At Oberheiden P.C., our attorneys and former federal agents are intimately familiar with the federal auditing and investigative processes. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts, For more information on the Departments response to the pandemic, please visit https://www.justice.gov/coronavirus. The Government alleged that Chanchikyan submitted fraudulent loan applications seeking approximately $345,000 in COVID-19 relief funds through his home health agency, Gentle Touch Home Health Care Inc. 4 Of The Best Ice Cream Spots In The Atlanta Area Vegan, Too! Attila Colar allegedly used several aliases in a scheme to illegally get $22 million from the PPP. 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. U.S. Attorney's Office, Northern District of Georgia, Former U.S. He also allegedly submitted forged tax documents. 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 complaint states they received loans of $450,000 and some of the proceeds were allegedly used to purchase a Mercedes E400. Rafael Maturino and Winston James were charged separately but allegedly worked together to carry out their scheme. 18, 2021 at 1:24 PM EDT A second PPP2 program was authorized by Congress for $275 billion. A Cessna Aircraft and a Lexus (Virginia October 20), 59. The retail giant suspended him and stated the charges were unrelated to Walmart. 95% Success Rate. These purposes include the payment of payroll and related expenses, the payment of insurance premiums, the payment of rent and mortgage interest under pre-existing obligations, and the payment of business utility bills. To support these payroll figures, each businesss loan application was accompanied by an Internal Revenue Service Form 941, which employers use to report payroll taxes, for each quarter of 2019 and by a bank statement or a spreadsheet reflecting payroll expenses. Its a wild tale. When arrested, he had almost $80,000 in cash at his home and $9,400 in his pocket, authorities claim. But of course, the government has to prove the allegations. Federal authorities claim they used some of the coronavirus pandemic funds to buy luxury automobiles. As part of their crimes, the defendants not only submitted false information for the business loans, but for the PPP, they also allegedly created fake Internal Revenue Service documentation to support the applications. no owner of a 20% or greater interest has been convicted of or pleaded guilty to a, Former Department of Justice Trial Attorneys, Former Federal Prosecutors, U.S. Attorneys Office. One was on behalf of a company called Texas Barbecue and the other called Houston Landscaping. He also agreed to forfeit various assets, including more than $2.1 million in seized funds, three luxury vehicles a 2018 Mercedes-Benz S-Class S65AMG, a 2018 Land Rover Range Rover, and a 2017 Acura NSX and several items of jewelry, including a gold Rolex. Kyle William Brenizer of St. Paul is charged with wire fraud and money laundering. Have a question about Government Services? The OMelveny law firm noted: if history is a guide, DOJ will use its leverage over institutions that processed the loans to do the governments initial work of identifying potential irregularities in loan applications. The Small Business Administration has released a list of businesses that have received emergency pandemic loans. Austin Hsu of Issaquah, WA was charged with wire fraud in connection with fraudulently seeking over $1.1 million. He allegedly obtained $200,000 in Paycheck Protection Program and Economic Injury Disaster loans and used the cash for personal expenses. Here's a list of the PPP loan prosecutions to date: 1. You can also check to see how many workers companies receiving the assistance said they kept on the payroll. Specifically, if and when Firm cooperates with Local Counsel, Firm will disclose the details to the client in writing for their approval. Two Miami neighbors, Latoya Stanley and Johnny Philus, are charged with getting more than $1 million in Economic Injury Disaster Loan and PPP loan amounts. Kenneth Gaughan is charged with obtaining over $2.1 million in PPP and Economic Injury Disaster Loan funds. The borrower gets the PPP loan funds into their bank account. 22-Year Old Hair Extensions Entrepreneur (Texas September 15), 50. They are applying for a PPP loan because, the uncertainty of current economic conditions makes necessary the loan request to support the ongoing operations of the eligible recipient; and. McQuarn allegedly used the cash for personal use including buying a 26-foot Pavati Wake Boat and a Rolls Royce. Lyft Software Engineer (Washington May 22), 9. A pair of Georgia businesses are in hot water over fraud allegations related to their PPP loans. Feel free to share this infographic (attribution required) on your own site by copying and pasting the code below: Could these prosecutions involve nothing more than paperwork mistakes? The PPP allows the interest and principal on the PPP loan to be entirely forgiven if the business spends the loan proceeds on these expense items within a designated period of time and uses a certain percentage of the PPP loan proceeds for payroll expenses. 5 Places To Swim In Atlanta A Swimming Activity Of Every Kind, The 5 Best Atlanta Facebook Groups To Follow ASAP, Adarin Jones, a/k/a Adrian Jones, 42, of Atlanta, GA. Victor Montgomery, 43, of Washington, D.C. For federal authorities such as the SBA-OIG and the DOJ, this includes suspect activity from any and all company personnel who are involved in responding to the governments inquiry; and, for companies, this includes evasiveness from employees during internal PPP compliance investigations. On March 16, 2020, Attorney General William Barr directed all 94 U.S. Attorneys Offices to prioritize investigating and prosecuting PPP loan cases of fraud. Larry Jordan and Sutukh El, two brothers, are charged with fraudulent PPP loan applications to the tune of $7 million, and actually receiving over $600,000. 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. Victor Montgomery, 43, of Washington, D.C.. According to the SBA, the Paycheck Protection Program ended on May 31, 2021. Six people were charged by indictment in this ring spanning two states. But in this PPP fraudulent case, five individuals from three states are charged with conspiracy to fraudulently get over $4 million and misusing the proceeds. Vegas Business Owner (Nevada August 13), 37. This comes as federal prosecutors in Georgia continue to make new arrests for PPP fraud. This owner of a wedding planning company is charged with submitting two PPP applications, and claiming to have 120 employees when he actually had none. Nurse Charged for Defrauding COVID-19 Relief Programs (Florida January 8, 2021), 78. Some of the law enforcement agencies involved in investigating are: The Board of Governors of the Federal Reserve System and Bureau of Consumer Financial Protection Office of Inspector General; Small Business Administration Office of Inspector General (SBA-OIG); Federal Deposit Insurance Corporation Office of Inspector General (FDIC-OIG), and the FBI. Million to personal accounts advertising in some jurisdictions, merely reading this information May constitute Attorney in! Had at least one indication of potential fraud in hot water over fraud allegations related their. 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