Texas man pleads guilty to $ 24 million COVID fraud program | Takeover bid


A man from Texas pleaded guilty today to orchestrating a fraudulent scheme to obtain an estimated $ 24.8 million in forgivable Paycheck Protection Program (P3) loans and laundering the proceeds.

According to court documents, Dinesh Sah, 55, of Coppell, admitted to submitting 15 fraudulent claims, filed under the names of various companies allegedly owned or controlled, to eight different lenders seeking about $ 24.8 million in PPP loans. Sah claimed that these companies had many employees and hundreds of thousands of dollars in salary expenses when in fact no company had employees or paid a salary in line with the amounts claimed in the P3 applications. Sah further admitted to submitting fraudulent documents in support of his claims, including fabricated federal tax returns and bank statements for the alleged companies, and falsely listing others as authorized representatives of some of these companies. without permission to use their credentials on apps.

“As the country was crippled by a global pandemic, Sah fraudulently secured over $ 17 million in PPP funds meant to help legitimate small businesses and spent that money on luxury cars and several homes,” said the Acting Assistant Attorney General Nicholas L. McQuaid of the Justice Department’s Criminal Division. “As our nation continues to fight this unprecedented virus, the Department of Justice and its law enforcement partners remain committed to aggressively prosecuting those who exploit COVID relief programs and ensuring that these ill-gotten gains are returned. “

“The Paycheck Protection Program was designed to help struggling business owners, not to line the pockets of shrewd profiteers,” Acting US Attorney Prerak Shah of the Northern District of Texas said. “Even as businessmen desperately tried to raise the funds they needed to keep their businesses afloat, Sah plunged into federal coffers to fund his lavish lifestyle. The Department of Justice is committed to protecting the PPP against fraud and deception. “

“We will continue to vigorously investigate cases involving attempted paycheque protection program fraud and other crimes against financial institutions that the FDIC insures and regulates,” said Special Agent in Charge Anand M. Ramlall of the Federal Deposit Insurance Corporation – Office of the Inspector General (FDIC-OIG). “Sah’s blatant fraud to fund his luxurious lifestyle is unacceptable under any circumstances, but especially when done against a program designed to help Americans recover from the ongoing pandemic. We appreciate the cooperation and coordination of our law enforcement partners on these types of investigations. “

Sah admitted that based on his misrepresentation and false documents, he received over $ 17 million in P3 loan funds and was diverting the proceeds for his personal gain, using them to buy multiple homes in Texas. , pay off mortgages on other homes in California, and buy a fleet of luxury cars, including a convertible Bentley, Corvette Stingray, and Porsche Macan. Sah has also sent millions of dollars in PPP proceeds in the form of international money transfers. As part of his guilty plea, Sah agreed to confiscate, among other assets, eight homes, numerous luxury vehicles and more than $ 7.2 million in fraudulent goods that the government has seized to date.

Sah has pleaded guilty to one count of wire fraud and one count of money laundering in the North District of Texas. He will be sentenced at a later date and faces a maximum sentence of 30 years in prison. A federal district court judge will determine any sentence after taking into account U.S. sentencing guidelines and other statutory factors.

The Dallas field offices of the FDIC-OIG, IRS-Criminal Investigation, and U.S. Treasury Inspector General for Tax Administration are investigating the case.

Deputy Deputy Chief Anna G. Kaminska of the Fraud Section of the Criminal Division and Section Chief Katherine Miller of the United States Attorney’s Office for the North Texas District are continuing the case. US deputy lawyers Erica Hilliard and Dimitri Rocha are handling the asset forfeiture component of the case.

The CARES (Coronavirus Aid, Relief, and Economic Security) law is a federal law enacted on March 29, 2020, designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic. One of the sources of relief provided by the CARES Act was the authorization of up to $ 349 billion in forgivable loans to small businesses for job maintenance and certain other expenses, through the PPP. In April 2020, Congress authorized more than $ 300 billion in additional P3 funding.

The PPP allows small businesses and other eligible organizations to benefit from loans with a two-year term and an interest rate of 1%. Proceeds from PPP loans are to be used by businesses on salary costs, mortgage interest, rent, and utilities. The PPP allows for the forgiveness of interest and principal of the PPP loan if the business spends the loan proceeds on these expenditure items within a specified time after receiving the proceeds and uses at least a certain percentage of the proceeds of the PPP loan to wage costs. .

The Fraud Section leads the Department of Justice’s prosecutions of fraud schemes that exploit the CARES Act. In the months following the passage of the CARES law, lawyers in the Fraud Section prosecuted more than 100 defendants in more than 70 criminal cases. The Fraud Section also seized over $ 65 million in cash from fraudulently obtained PPP funds, as well as numerous real estate and luxury items purchased with this product. More information can be found at: https://www.justice.gov/criminal-fraud/cares-act-fraud.

Anyone with general information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Control hotline at 866-720 -5721 or via the NCDF online complaint form at the following address: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

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