Five small business owners - three who are from Georgia - are being accused of a scheme to obtain nearly $4.1 million in loan funding under the Paycheck Protection Program.
Darrell Thomas, 34, of Duluth, Georgia, Andre Lee Gaines, 66, of Dallas, Georgia, Kahlil Gibran Green, Sr., 46, of Cleveland, Ohio, and Bern Benoit, 44, of Burbank, California, are charged with conspiracy to commit bank fraud and wire fraud and other charges.
Carla Jackson, 52, of Tucker, Georgia, is charged with money laundering. The defendants were indicted on August 4.
U.S. Attorney Byung Pak's office said on Thursday that the indictment alleges that in April and May, PPP loan applications were submitted on behalf of five businesses seeking a loan of approximately $800,000 for each company.
“The PPP was enacted to provide emergency financial assistance to business owners who are suffering the economic effects caused by the COVID-19 pandemic,” said Pak.
“The defendants allegedly took advantage of this critical financial assistance to fraudulently obtain funds that other small businesses desperately needed to keep their employees on the payroll," Pak added in the news release. "We will continue investigating and prosecuting those who seek to line their own pockets.”
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Officials said the defendants certified that each applicant business was in operation on February 15, 2020 and had employees for whom it paid salaries and payroll taxes or paid independent contractors. The funds were expected to be used to retain workers, make mortgage interest payments lease payments, or utility payments.
"Four of the businesses also submitted with their applications fake bank statements that significantly inflated the funds in the businesses’ bank accounts," the news release said. "Indeed, two of the businesses did not open their bank accounts until after the time period reported on the fake bank statements."
“The allegations against these defendants are disturbing,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “Trying to defraud a federal program that provides financial assistance to companies trying to keep their heads above water during a pandemic is something we are very serious about and making every effort to stop.”