LAS VEGAS, Nevada – A Nevada man was arraigned on December 18, 2020 for fraudulently obtaining approximately $ 1,662,170 from the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) loan.
U.S. Attorney Nicholas A. Trutanich of the Nevada District, Special Agent in Charge Aaron C. Rouse of the FBI Field Office in Las Vegas, Special Agent in Charge Tara Sullivan of the Internal Revenue Service-Criminal Investigation (IRS -CI) and Special Officer-in-Charge Weston King of the Office of the Inspector General of the Small Business Administration (SBA-OIG) made the announcement.
Bryan Robinson, 37, of Henderson, Nevada, is charged in a Nevada District indictment with two counts of wire fraud and one count of involvement in illegal product transactions. He appeared on December 18 before US trial judge Cam Ferenbach in Las Vegas.
The indictment alleges that Robinson perpetrated a scheme to submit a fraudulent EIDL application to the SBA and a fraudulent PPP loan application to a fintech company. The SBA is guaranteeing loans for COVID-19 relief through PPP under the CARES Coronavirus Aid, Relief and Economic Security Act. The CARES Act also authorizes the SBA to provide an EIDL of up to $ 2 million to eligible small businesses experiencing financial disruption due to the COVID-19 pandemic.
According to the indictment, Robinson made two fraudulent claims on behalf of ATeam LLC, which is a dance company, for: (1) a PPP loan of approximately $ 1,502,000; and (2) an EIDL of approximately $ 150,000. The loan applications represented that ATeam had 37 employees, significant salary costs and substantial income. But ATeam was in fact a dance company and paid no salary.
Further, the indictment alleges that Robinson did not use the funds to pay salaries. Instead, he used the funds for personal expenses and transfers to other businesses.
The CARES Act is a federal law enacted on March 29, 2020. It is designed to provide emergency financial assistance to millions of Americans who are suffering the economic effects resulting from the COVID-19 pandemic. One source of relief under the CARES Act is the authorization of up to $ 349 billion in forgivable loans to small businesses for job retention and certain other expenses under 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 receive loans with a two-year term and an interest rate of one percent. Businesses must use the proceeds of the PPP loan for salary costs, mortgage interest, rent, and utilities. The PPP allows for the forgiveness of interest and principal if companies spend the proceeds of these expenses within a specified time frame and use at least a certain percentage of the loan for salary expenses.
The EIDL program is designed to provide economic relief to small businesses that are currently experiencing a temporary loss of income. Proceeds from EIDL can be used to cover a wide range of working capital and normal operating expenses, such as continued health care benefits, rent, utilities, and fixed debt payments. If an applicant also obtains a loan under the PPP, the EIDL funds cannot be used for the same purposes as the PPP funds.
A federal accusation complaint is just an accusation. An accused is presumed innocent until proven guilty beyond a reasonable doubt in court.
The FBI, IRS-CI, and SBA-OIG investigated the case. Attorney Joseph McFarlane of the Fraud Section of the Criminal Division of the Department of Justice and Assistant U.S. Attorney Jessica Oliva of the U.S. Attorney’s Office for the Nevada District are continuing the case.