A federal jury convicted a Texas man Wednesday for his role in a scheme to fraudulently obtain and launder millions of dollars in forgivable Paycheck Protection Program (PPP) loans under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, officials stated.
According to court evidence, Abdul Fatani, 57, of Richmond, conspired with others to submit fraudulent PPP loan applications by falsifying the number of employees and the average monthly payroll expenses of the applicant businesses.
The co-conspirators sought over $35 million through more than 80 fraudulent PPP loans.
Fatani distributed over $500,000 in fraudulent loan proceeds to his co-conspirators and himself using bogus payroll checks and laundered a portion of the proceeds by transferring the funds from one of his bank accounts to another bank account he controlled.
Fatani was convicted of one count of conspiracy to commit wire fraud, one count of wire fraud, and one count of unlawful monetary transactions (money laundering).
He is scheduled to be sentenced on May 8.
Fatani faces a maximum penalty of 20 years in prison for conspiracy and wire fraud and 10 years in prison for money laundering.
In addition, 15 other individuals have pleaded guilty to their involvement in the loan fraud scheme.
Trial Attorneys Kate McCarthy, Spencer Ryan, Della Sentilles, and Louis Manzo of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Rodolfo Ramirez for the Southern District of Texas are prosecuting the case.
The Fraud Section leads the Criminal Division’s prosecution of fraud schemes that exploit the PPP.
Since the inception of the CARES Act, the Fraud Section has prosecuted over 200 defendants in more than 130 criminal cases and has seized over $78 million in cash proceeds derived from fraudulently obtained PPP funds, as well as numerous real estate properties and luxury items purchased with such proceeds.
More information can be found at https://www.justice.gov/criminal-fraud/ppp-fraud.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline via the NCDF Web Complaint Form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.Man