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30Jul21

Man Sentenced for COVID-19 Relief Fraud

A Florida man was sentenced today to 33 months in prison for fraudulently seeking over $7,263,564 in Paycheck Protection Program (PPP) loans guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

Andre Clark, 48, of Miramar, pleaded guilty to one count of conspiracy to commit wire fraud on May 14, 2021. According to court documents, Clark admitted that he obtained a PPP loan of $488,565 on behalf of his company, Top Choice LLC, based on falsified information and documents that a co-conspirator, James Stote, submitted on his behalf. Clark also admitted to recruiting friends and associates whom he referred to Stote for the purpose of submitting additional fraudulent PPP loan applications, sometimes in exchange for kickbacks. Clark admitted to seeking $6,774,999 in fraudulent PPP loans through other conspirators that he referred to the scheme. In addition to the prison sentence, Clark was ordered to pay $2,975,086 in restitution.

Additionally, two other co-conspirators were recently sentenced for their role in the scheme. On July 29, 2021, Tonye Johnson, 29, of Philadelphia, Pennsylvania, was sentenced to 18 months in prison. According to court documents, Johnson admitted to obtaining a fraudulent PPP loan of $389,627 for his company, Synergy Towing & Transport LLC, based on falsified information and documents. And on July 13, 2021, Tiara Walker, 38, of Miami Gardens, Florida, was sentenced to 12 months and a day in prison. According to court documents, Walker admitted to obtaining a fraudulent PPP loan of $258,575 for her company, Utilization Review Pros LLC, based on falsified information and documents. Both Johnson and Walker falsely inflated the number of employees and monthly payroll for their companies, and they worked with Stote and other co-conspirators to obtain their fraudulent loans.

James Stote was charged by complaint on June 24, 2020, with wire fraud, bank fraud, and conspiracy to commit wire fraud, and his case remains pending. A complaint is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department's Criminal Division; Acting U.S. Attorney Juan Antonio "Tony" Gonzalez of the Southern District of Florida; Special Agent in Charge Michael J. De Palma of the IRS Criminal Investigation (IRS-CI) Miami Field Office; Special Agent in Charge George L. Piro of the FBI's Miami Field Office; and Special Agent in Charge Amaleka McCall-Brathwaite of the SBA's Office of Inspector General (SBA-OIG) Eastern Region made the announcement.

The IRS-CI, FBI, and SBA-OIG investigated the cases.

Trial Attorney Philip Trout of the Criminal Division's Fraud Section and Assistant U.S. Attorneys David Turken and David Snider of the U.S. Attorney's Office for the Southern District of Florida prosecuted the cases.

The Fraud Section leads the department's prosecution of fraud schemes that exploit the PPP. In the months since the PPP began, Fraud Section attorneys have prosecuted more than 100 defendants in more than 70 criminal cases. The Fraud Section has also seized more than $65 million in cash proceeds derived from fraudulently obtained PPP funds, as well as numerous real estate properties and luxury items purchased with such proceeds. More information can be found at: https://www.justice.gov/criminal-fraud/ppp-fraud.

In May, 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. 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 department's response to the pandemic, please visit https://www.justice.gov/coronavirus.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice's National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form

[Source: DOJ, Office of Public Affairs, Washington, 30Jul21]
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