Eleven men have been sentenced after a scheme to obtain $3 million in Paycheck Protection Program loans; Atlanta man Rodericque Thompson recruited nine business owners to obtain $300,000 loans with fraudulent applications, according to the U.S. Attorney’s Office for the Northern District of Georgia.
“The CARES Act and the PPP designated funds to aid struggling businesses during a pandemic,” said U.S. Attorney Ryan Buchanan said in a press release. “American businesses needed these funds to keep their companies and employees afloat during a national emergency and world-wide pandemic. These defendants took advantage of that program to obtain money to which they were not lawfully entitled. We will continue investigating and prosecuting those who attempt to steal these critical funds.”
The attorney’s office reported that Thompson offered 50 percent of the loan proceeds to each of the men and helped them obtain the loans using similar paperwork.
“For example, each of the loan applications claimed that the relevant business employed 16 individuals and paid monthly wages of $120,000. Additionally, identical fraudulent quarterly tax returns were submitted in connection with each loan application,” the press release states.
The business owners then wrote checks to people who weren’t employed at the businesses but kept the money or gave it to Thompson.
“They hoped to hide the fraud and expected to get the loans forgiven by writing ‘payroll’ on the checks,” the attorney’s office said.
Authorities have only recovered about $1.2 million of the funds.
Thompson was sentenced to ten months in prison, five years of supervised release, and $2.7 million in restitution. Sentences for the others range from two to three years of supervised release on top of several months in prison and restitution ranging from $114,828.19 up to $897,172.61.
“We will continue to aggressively pursue those who defrauded the Paycheck Protection Program which was funded by taxpayers and designed to assist businesses during the pandemic,” Treasury Inspector General for Tax Administration J. Russell George said in the release. “We appreciate the efforts by our federal partners and the U.S. Attorney’s Office to hold these individuals to account.”
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Eric Burk is a reporter at The Georgia Star News and The Star News Network. Email tips to [email protected].
Background Photo “Courtroom” by Carol M. Highsmith.