The SBA now also conducts manual loan reviews for the largest loans in the PPP portfolio and a random sampling of other loans. Underscoring the tension between fraud prevention and disbursing assistance quickly, the added checks to verify information submitted by applicants have somewhat slowed the processing of loan applications. On January 11, in the final days of the Trump administration, the Small Business Administration began processing a new round of Paycheck Protection Program loans. Law enforcement insiders say many more pandemic loan fraud cases will be brought in the months and years ahead. The program began issuing loans again in January 2021, and some businesses are eligible for a second loan. complaint (20-mag-12908). Using a telemarketing scheme called My Buddy Loans, the telemarketing scheme exploited those seeking assistance during the COVID pandemic, including many who were over the age of 55, according to a Small Business Administration inspector general agent quoted in a Justice Department press release. They determined that a lot of the folks that they have as subjects of their investigations in HHS OIG [for Medicare and Medicaid fraud], were also committing PPP and EIDL fraud, Grossman said. The Biden administration published a fact sheet on February 2 detailing new measures to prevent fraud in the program. ggdc fulfill service phone number; copenhagen, denmark circle houses for sale; living together in kuwait; brandi carlile brother jay; houston film festival; terrenos de venta en palmview, tx; louisiana ppp loan arrests. The case led to criminal charges, including aggravated identify theft, filed in Texas in February. Joshua Edwards, the supposed vice president of ASLAN International Ministry, is accused of submitting fake payroll, tax, and financial documentation in support of the loan application. Sen. John Kennedy says in the rush to get help to people in need as quickly as possible, Congress didnt have time to build many safeguards against fraud into the program. The auditor found that the deficiencies were caused by an inadequate entity wide control environment.. Civil enforcementwhere the evidentiary burden is lower than in criminal casesis another way of holding individuals and companies accountable. In less than six months, more than 50 people have been charged with allegedly committing fraud in connection with the program. (WAFB) - The Paycheck Protection Program, known as PPP, provided a lifeline for millions of business owners when the pandemic was at its worst. We hear reports of arrests and arraignments for PPP loan cases involving only $10,000 or $15,000. The DOJ says falsified tax records were submitted and in some cases, stolen personal information was also used in these attempts to defraud the PPP. One case involves Dinesh Sah, a Dallas-area man, who obtained $17.3 million after having sought a $24.8 million loan. are moving. To disguise the fraud, family members moved the proceeds through several bank accounts held in different names, according to the Justice Department. With over 18 million Paycheck Protection Program loans and pandemic-related Economic Injury Disaster loans and advance grants approved over the last year, there is a sea of data on these programs. With more time, we might have been able to implement some preemptive fraud measures, but we knew there would be some fraud, said Kennedy. Summary of PPP Loans in Louisiana. PPP Loan Recipient List By State Louisiana 217,332 TOTAL PPP LOANS $12.2B TOTAL LOAN AMOUNT $56,095 AVERAGE PPP LOAN 6 AVG COMPANY SIZE Louisiana has a total of 217,332 businesses that received Paycheck Protection Program (PPP) loans from the Small Business Administration. Maybe, maybe not all.. There is abundant evidence that there was too little upfront vetting of loan applications in both the Paycheck Protection Program and Economic Injury Disaster Loan program. In July, banks filed nearly seven times the average number of suspicious activity reports. In addition, the defendants falsely listed the same employees in applications for different nail salons to support the loan amounts applied for, and some purported employees were listed as employees of as many as seven different nail salons during the same time period. They often involve obtaining and then piecing together often-complex financial, payroll, and tax records for individuals and companies, and sifting through other evidence. Rabbitt noted the unparalleled speed with which these cases have been investigated and prosecuted.. The False Claims Act will play a central role in the Departments pursuit of COVID-19 related fraud, Michael Granston, a Justice Department deputy assistant attorney general, said in December. Dr. James Hobley: When should you be screened for colon cancer? Alabama Arkansas Arizona California Colorado Florida Georgia Idaho Illinois Indiana Iowa Kentucky Kansas Louisiana Maine Maryland Michigan Minnesota Missouri Mississippi Montana Nebraska Nevada New Hampshire New Jersey New Mexico North Carolina Oklahoma . Greenbergs insider was a loan officer who began working for the agency in May 2020. This case was brought in New Orleans, Louisiana. So were trying to reverse that. If a company is eligible for a loan and submits certifications in good faith, that company will have nothing to fear from the Civil Division. In addition to automated checks against existing government databases, lenders could have conducted online searches or called businesses neighboring a loan applicant to help establish whether the company seeking the loan is real or is the size it claims to be. Who in Louisiana got Paycheck Protection Program loans during the pandemic? We have a lot of qui tam cases that have been brought forward, Grossman told POGO, generally referring to False Claims Act complaints filed by private individuals. . Marion State Bank. Representative James Clyburn (D-SC), chair of the House Select Subcommittee on the Coronavirus Crisis, said in the March 25 hearing that the Trump administration ignored flags of potential fraud in the Economic Injury Disaster Loan program, and approved loans in batches with little to no vetting and abandoned a rule that required two SBA employees to approve each loan application., The Trump administration ignored flags of potential fraud, While a year has passed since the CARES Act became law and there are more checks now, government watchdogs say the Small Business Administrations oversight of the lending programs is still inadequate. These are not simple or easy cases to investigate and charge, then-acting Assistant Attorney General Brian Rabbitt said at a press conference last September. Investigators determined there were at least 110 PPP sole proprietor loan applications in and around the Thibodeaux, Louisiana area and they all had the same invoices and federal tax forms (Schedule C) with the same business name and amounts. Former La. And this is not the only case. The PPP was developed to ease the pain of COVID-19 economic restraints on working Americans. GOODWILL INDUSTRIES OF NORTH LOUISIANA, INC. BIOMEDICAL RESEARCH FOUNDATION OF NORTHWEST LOUISIANA, ROSS H DIES DDS & BENJAMIN A BEACH DDS, LLC, Agriculture, Forestry, Fishing and Hunting, Professional, Scientific, and Technical Services, Administrative and Support and Waste Management and Remediation Services, Other Services (except Public Administration). Loan Range No. Barbershops were one of the most common businesses to apply. And I, I think we ought to prosecute every single one of them to the full extent of the law, said Kennedy. of Loans Jobs Retained Applicants fraudulently obtained at least $16 million, per the Justice Department. In 2020, applicants could not lawfully receive more than one Paycheck Protection Program loan. An estimated 1% of that 2009 stimulus was lost to fraud (some claim the rate is even lower than that). According to an indictment, Sah submitted at least 15 fraudulent applications on behalf of at least 10 companies. Many Paycheck Protection Program loans appear to have been issued to recipients who were not eligible under the programs rules. Check out bed occupancy rate of hospitals. One case involved applications for hundreds of allegedly fraudulent Economic Injury Disaster loans and at least a $1.3 million loss to the federal government. Your Address, Corporation Income/Franchise Extension Request. You have to understand from the lenders perspective, really, theyre just looking at income. An Archdale man was arrested after authorities say he falsely received more than $1.5 million in COVID-19 relief money through the Paycheck Protection Program. Maurice Kamgaing, 41 sent PPP loan . Senator Kennedy admits the program may have had some holes in it, due to how quickly it was rolled out, and the loan program has been updated many times to expand eligibility. The only way you can reverse those things is by understanding the metrics behind it and to have real goals around them.. Louisiana has a total of 217,332 businesses that received Paycheck Protection Program (PPP) loans from the Small Business Administration. Louisiana Workforce Commission Suspected Fraud Form. The forgivable loans were meant to cover payroll for employees and, later, other eligible expenses at a time when customers werent coming in. According to the MITRE Corporation, a mismatched zip code or insufficient award description doesnt seem particularly egregious. Aqeel used some of the proceeds to purchase a Lamborghini sports car, according to the Justice Department. Click here to report information on Amazon warehouses. There were additional steps that could have been undertaken that would not have significantly slowed downin our view in the oversight communitythe delivery of funds to the public, said Michael Horowitz, the Justice Departments inspector general and chair of the Pandemic Response Accountability Committee, in testimony before Congress on March 25. As of late March, the department has obtained 48 convictions. EVERY advertised under various aliases on Facebook to recruit individuals to obtain money from the PPP program. Under the Coronavirus Response and Relief Supplemental Appropriations Act, passed as part of the Consolidated Appropriations Act of 2021, (CARES II), individuals began receiving automatically a second round of Economic Impact Payments of up to $600 for individuals or $1,200 for married couples and up to $600 for each qualifying child beginning in December. It soon became apparent that the Economic Injury Disaster Loan programs setup also made it particularly susceptible to fraud. Name Jobs Reported Current Loan Loan Forgiveness; Amount ($) Date Approved Amount ($) Date; CONQUEST COMPLETION SERVICES, LLC: 129: 6,940,800: July 30, 2020: 7,069,157 For media inquiries, contact: Two of the companies, Symbiont Retailers and Horizon Enterprises, were not in good standing before the Paycheck Protection Program began. The scandal is whats legal, not whats illegal.. Whistleblowers Said This Company Is a Fake Small Business. The PPP loans are forgivable under certain conditions and the loan forgiveness is not taxable income for federal tax purposes. As far as the state of Louisiana is concerned, there is no requirement that a sole proprietor have a specific license at the state, said Ricks. GOODWILL INDUSTRIES OF NORTH LOUISIANA INC. 6 AVG COMPANY SIZE. Small Business Administration management flagged loans for at least one of 35 reasons, such as the recipient was created after the cutoff date of February 15, 2020, or the recipients owner had a criminal record, potentially rendering the recipient ineligible. They allegedly exploited a program designed to provide vital funding for small businesses that are legitimately struggling in the midst of the pandemic. The CARES Act provided $600 weekly supplemental unemployment benefits for individuals out of work for reasons related to the pandemic. According to court records, Amir Aqeel and several others in the Houston area allegedly created fake tax and payroll documentation in exchange for large kickbacks for referring others into the scheme that involved 12 corporate entities. Eastern District of Louisiana The Department of Justice says in Feb. 2021, Gray created a scheme to defraud a lender and the United States, through the Small Business Administration, by filing false applications for PPP. (He also applied for a separate loan just days before being indicted.) PPP Loan Recipient List By State . However, industry insiders say the barbershop industry is largely cash-based, making it easy to operate under the radar. to fraudulently obtain the loan money. The Small Business Administration has released a list of businesses that have received emergency pandemic loans. Funds disseminated through this program are subject to Louisiana state income tax. project, POGO has been examining equitable access to government loans, grants, and contracts. According to the National Priorities Project, thats enough money to pay for both coronavirus vaccine doses for every American and 1.1 million full-time jobs at $15 an hour for an entire year. The scale of lending means the potential amount of Economic Injury Disaster loan fraud is staggering. According to the Justice Department, Didier Kindambu obtained two loans by creating fraudulent payroll documentation for each business.. Generally, cases where there is any substantial gray areasuch as a lack of unambiguous evidence of fraud or when it wasnt clear what a government rule requiredare far more likely to lead to civil enforcement, or to no enforcement. Public Information Director The Small Business Administration has released a list of businesses that have received emergency pandemic loans.. For more information on the Departments response to the pandemic, please visit https://www.justice.gov/coronavirus. When we receive complaints on PPP and EIDL fraud, we immediately coordinate with the Department of Justice, to see what their interest is in the case. This interactive map provides a picture of the ranks of the unemployed at the national, state and county level. Analyzing that data for red flags is a way to identity subsets of loans and grants that warrant closer scrutiny and to help direct scarce investigative resources. Aqeel and others in the scheme allegedly used loan funds to pay individuals they claimed were employees but were actually fake employees, according to a court filing. NGUYEN, 44, and VICTORIA HO, 31, both of Hicksville, New York, and DAT HO, 33, of the Bronx, New York, are each charged with one count of conspiracy to commit bank and wire fraud, which carries a maximum sentence of 30 years in prison; one count of major fraud against the United States, which carries a maximum sentence of 10 years in prison; and one count of conspiracy to make false statements, which carries a maximum sentence of five years in prison. The cases involve attempts to steal a total of more than $175 million from the program, with actual losses to the federal government totaling more than $70 million, the DOJ reports. Normally, the agency can require loan applicants to fill out a form allowing the agency to verify their tax information with the Internal Revenue Service. Grossman told POGO, we expect a lot more civil enforcement.. About one year after the passage of the CARES Act, $626 million in funds have already been seized or forfeited related to criminal and civil investigations of pandemic loan fraud. Making sure that victims of federal crimes are treated with compassion, fairness and respect. But such gaps can create ambiguities that muddy the waters in overseeing spending., Still, much can be done with the data that does exist. The oversight failures of the last year have become increasingly clear, eventually leading to changes. When the government spends money, taxpayers deserve to know how it was spent, Clarion Ledger Editor Marlon A. Walker says. Indeed, on the day lenders began processing applications for Paycheck Protection Program loans last year, Small Business Administration Inspector General Hannibal Mike Ware issued a white paper outlining lessons learned from previous stimulus loan programs. U.S. Attorney's Office, Eastern District of Louisiana, Former Louisiana Woman Indicted for Preparing Over 110 Fraudulent PPP Loans Totaling Over $1.1 Million Dollars, 2_ecf_doc_1_-_sharnae_every_indictment_redacted_sanitized.pdf, Dr. Charles J. Southall, III Sentenced to 60 Months in Prison for Money Laundering, Obtaining Over $889,000 Through Fraud, New Orleans Man Sentenced for Theft and Sale of Motor Vehicle from Mississippi Car Dealership, Two More New Orleans Residents Sentenced in Staged Automobile Collision Scheme, Former Louisiana Woman Indicted For Preparing Over 110 Fraudulent PPP Loans Totaling Over $1.1 Million Dollars. At $367 billion, the amount of disaster funds provided through the EIDL COVID program is more than three times the amount of disaster loan funds approved for all disasters combined since the SBA was created in 1953, wrote Jovita Carranza, then-head of the Small Business Administration, in December 2020. Acting U.S. Attorney Audrey Strauss said: As alleged, these defendants conspired to rip off the SBAs COVID-relief small business loan program and financial institutions by lying about how many people they employed in their family business and how much they paid those employees. He also opened bank accounts and lines of credit at financial institutions and credit card companies in the names of his elderly victims, according to the Justice Department. Brian Grossman, the Small Business Administrations assistant inspector general for investigations, told POGO that as of March 10, 2021, the watchdog office had 91 active Paycheck Protection Program investigations and 121 active Economic Injury Disaster loan investigations. NGUYEN, VICTORIA HO, and DAT HO are members of a family that owns a chain of over 15 nail salons called Victoria Nails & Spa and other companies (the Victoria Companies) in or around the New York metropolitan area, including the Bronx, Brooklyn, and Long Island. Both laws have provisions allowing whistleblowers to receive a reward for successful recoveries obtained for the U.S. government. Normally, the office of inspector general receives between 700 and 800 hotline complaints or tips a year. More due diligence on the part of lenders or the Small Business Administration could have prevented at least some instances of fraud. VICTORIA HO will be presented tomorrow in Manhattan federal court before U.S. Magistrate Judge Sarah Netburn. EVERY falsely certified that the applications and the information provided in the supporting documents were true and accurate when she electronically submitted the fraudulent PPP loan applications. The prosecution of this case is being handled by the Offices Complex Frauds and Cybercrime Unit. To me, its like looting after a hurricane. Act 12 of the 2020 First Extraordinary Session of the Louisiana Legislature provided for a one-time $250 rebate for eligible workers earning $50,000 per year or less, who spent at least 200 hours responding to or mitigating the COVID-19 crisis from March 22, 2020, through May 14, 2020. As former federal prosecutor Tarek Helou told the Wall Street Journal, The scandal is whats legal, not whats illegal., Lenders may also be more likely to face civil enforcement than criminal enforcement. 66625. The lender got to keep a fee based on the size of the loan. The Justice Department has brought charges in at least 56 cases for alleged Paycheck Protection Program fraud, according to a POGO review detailing trends in these first cases. The Department of Justice confirms they are looking into reports of PPP fraud across the nation. According to the U.S. Attorneys Office, there have been dozens of people charged with fraud nationwide and there are five pending Federal civil procedures where agencies are looking to get back $2.3 million worth of fraudulent assets including two high-end cars, a house, and cash. Given the focus of the PPP to support employees during the COVID-19 pandemic, the Robinson Bradshaw firm wrote last May, it is easy to imagine how a dissatisfied employee observing imperfect business conduct in securing a PPP loan or applying loan proceeds could use that insider information to bring a qui tam action under the FCA.. Two people were approved for that amount twice, and one of those people got paid twice. As of this month, weve seized over $580 million from over 23,000 fraudulent EIDL loans., Weve got a process in place that once weve identified, for instance, a bank account that has money sitting in it, that was deposited through a fraudulent EIDL loan, we contact the Secret Service, and they have a method to go in and seize those funds, Grossman said. In order to support the false representations in the loan applications about the number of employees at, and the wages paid by, the Victoria Companies, the defendants submitted fraudulent and doctored payroll and tax records. DAVID RAINES COMMUNITY HEALTH CENTER, INC. A .gov website belongs to an official government organization in the United States. After the defendants learned that a hold was placed on bank accounts of the Victoria Companies that received PPP loans issued by one financial institution due to suspicion of fraudulent activity, one of the defendants conducted Internet searches for PPP Fraud, PPP Loan Fraud Arrests, and How to get rid of a PPP Loan. The defendants thereafter withdrew the applications for and/or repaid the PPP loans for the Victoria Companies issued by that financial institution. POGO was unable to reach Edwards before publication. If you look at the last round [of PPP] and you look at it on a time series, it almost looks like the largest businesses and businesses in high-income neighborhoods received money first and smaller businesses and businesses in low-income neighborhoods received money last, the Small Business Administrations Michael Roth told Politico in March. Inaccuracies in the data or missing data can undermine oversight. The Justice Department said law enforcement arrested defendants in Miami on Wednesday and Thursday who officials allege are involved in a "criminal ring" that attempted to steal $24 million in. Does something look fishy to you? The SBA Employee would and did use her access to the SBAs computer systems and her access to EIDLs to manipulate the status of EIDLs to trigger the system to extend funding for EIDLs submitted for the benefit for Joel Micah Greenberg, the indictment alleges. Todays Internet search for PPP Loan Fraud Arrests will certainly produce an unwanted result one that includes the name of their company leading the headlines., IRS-CI Special Agent in Charge Jonathan D. Larsen said: In this difficult time when many Americans are struggling financially, it is repugnant that there are those who would fraudulently take advantage of relief efforts offered. He allegedly sought to obtain a total of more than $1.5 million in Paycheck Protection Program loans, at least $937,000 of which he successfully obtained. Nick Schwellenbach is a Senior Investigator at POGO. Suspicious activity reports for small business loan fraud continued at levels far higher than normal through the end of 2020, according to POGOs review of federal data. A lock ( For instance, in one larger case, the Justice Department has charged 19 individuals to date. to give the federal government time to investigate and evaluate the complaint before it becomes public. (In late March, the Justice Department told Congress that it had charged $446.8 million in losses related to PPP. Some of these cases may still be under seal and charges are routinely being unsealed.) You can search the SBA's entire PPP loan data below. Click on a company's name to see additional loan details. The involvement of a Small Business Administration employee in a pandemic loan fraud case raises questions about the agencys vetting of employees. But in March 2021, the Small Business Administration Office of Inspector General issued a report that found that lenders last year issued more than one Paycheck Protection Program loan to 4,260 borrowers with the same tax identification number and borrowers with the same business name and address. Those loans were worth a total of $692 million. There are many potential cases the Justice Department may not prosecute. $56,095 AVERAGE PPP LOAN. Nearly a dozen of those people took out two loans. This table shows the top 5 industries in Louisiana by number . New Orleans, Louisiana 70130. More than 1,400 institutions had filed SARs related to PPP, and more than 900 institutions had filed SARs related to EIDL.. 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