Two individuals of Indian descent residing in the United States have entered guilty pleas regarding their roles in a multi-million dollar fraudulent scheme focused on securing loans through an economic assistance program implemented in response to the COVID-19 pandemic in the country, as reported by the Department of Justice.
According to a statement from the Department of Justice, Nishant Patel aged 41, and Harjeet Singh, aged 49, both residents of Houston, along with three additional accomplices, were involved in obtaining and laundering substantial sums of money through fraudulently acquired Paycheck Protection Program (PPP) loans. These loans are backed by the Small Business Administration (SBA) and are made available under the CARES Act.
The accused individuals confessed to their actions, which included the submission of fabricated and deceptive PPP loan applications to both the SBA and specific SBA-approved PPP lenders. All five defendants also played a role in the process of laundering the unlawfully acquired PPP loan funds. They achieved this by providing associates with blank, endorsed checks. These checks were made out to individuals who posed as employees of the companies that had received the PPP loans, even though these individuals were not actually employed by those companies.
These counterfeit paychecks were subsequently cashed at check-cashing establishments controlled by other members of the conspiracy.
Within the framework of the scheme, Patel secured a fraudulent PPP loan amounting to approximately $474,993, while Singh obtained two fraudulent PPP loans with a combined total of $937,379, according to the statement.
The three other participants in the fraudulent activity collectively obtained over $1.4 million.
Sentencing for the individuals has been scheduled for January 4 of the upcoming year. Each defendant faces a maximum penalty of five years in prison.
In addition to these five defendants, one additional individual was found guilty at trial for their involvement in the scheme, while 15 other individuals pleaded guilty to their roles in the loan fraud scheme.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act of 2020 was enacted to provide swift and direct economic assistance to American workers, families, small businesses, and industries affected by the COVID-19 pandemic.
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