Maryland man faces federal charge for fraudulently obtaining $ 3.5 million in COVID relief funds | USAO-MD

green belt, Maryland – A federal grand jury has handed down an indictment charging Rudolph Elwood Brooks, Jr., 45, of Bowie, Maryland, with federal wire fraud and money laundering.

The indictment was announced by the Acting United States Attorney for the District of Maryland, Jonathan F. Lenzner; Special Agent in Charge Shimon R. Richmond of the Federal Deposit Insurance Corporation, Office of the Inspector General (FDIC OIG); Acting Special Agent in Charge Darrell Waldon of the Internal Revenue Service – Criminal Investigation (IRS-CI), Washington, DC Field Office; Special Agent in Charge Thomas J. Sobocinski of the Federal Bureau of Investigation, Baltimore Field Office; and Inspector General Hannibal “Mike” Ware of the Office of the Inspector General of the United States Small Business Administration (SBA OIG).

The nine-count indictment charges Brooks with three counts of wire fraud involving Brooks’ forwarding of loan applications submitted through the Paycheck Protection Program (“P3”) on behalf of three entities controlled by Brooks: Cars Direct by Gavawn HWD Bob’s Motors (“Cars Direct”), Madaro, LLC (“Madaro”) and Kingdom Tabernacle of Restoration of Ministries (“Kingdom Tabernacle”). As alleged in the indictment, Brooks electronically submitted PPP loan applications on behalf of Cars Direct, Madaro and Kingdom Tabernacle containing false statements regarding the number of employees and salary expenses of the entities. In support of the PPP loan applications, Brooks also submitted false tax forms that were not on file with the Internal Revenue Service.

On May 9, 2020, Cars Direct’s PPP loan was approved and on May 12, 2020, $ 1,556,589 of loan proceeds was deposited into an account controlled by Brooks. On May 11, 2020, Madaro’s PPP loan was approved and on May 13, 2020, proceeds of $ 204,266 were deposited into an account controlled by Brooks. On May 14, 2020, Kingdom Tabernacle’s PPP loan was approved and on May 15, 2020, $ 1.8 million of loan proceeds was deposited into an account controlled by Brooks.

In total, based on the bogus and fraudulent PPP loan applications, Brooks has obtained at least $ 3,560,855 in PPP loan products. Brooks used the proceeds of the P3 loan for personal benefit and on unauthorized payments and purchases under the Paycheck Protection Program, including payments for a residence, purchase of a luxury vehicle, purchases at restaurants, retail stores, grocery stores, cash withdrawals and transfers to other bank accounts controlled by Brooks.

The indictment also charges Brooks with three counts of money laundering for wire transfers derived from the criminal proceeds of PPP loans that were used to purchase a 2018 Tesla Model 3, from real estate to Baltimore, Maryland, and real estate in Upper Marlboro, Maryland. The indictment also charges Brooks with three counts of money laundering for the purchase, on April 5, 2021, of three cashier’s checks for $ 100,000 payable to “Rudolph Brooks” from the proceeds of fraudulent PPP loans.

To date, the United States has recovered over $ 1.6 million in proceeds from fraudulent PPP loans as well as a 2018 Tesla Model 3 purchased with the proceeds of the Cars Direct PPP loan. As alleged in the indictment, if found guilty, the United States will seek the confiscation of the property seized as well as the property in Upper Marlboro, MD, purchased with the proceeds of the fraud. The United States also filed a parallel civil forfeiture complaint against the property in Upper Marlboro, Md., On August 12, 2021, alleging that the property was purchased with proceeds of over $ 500,000 attributable to PPP loans. Kingdom Tabernacle and Cars Direct.

As detailed in the indictment, the Coronavirus Aid, Relief, and Economic Security Act (CARES) is federal law enacted in March 2020 to provide emergency financial assistance to millions of Americans. suffering from the economic consequences of COVID-19. The CARES Act authorized up to $ 659 billion in forgivable loans to small businesses for employee retention and certain business expenses through the Paycheck Protection Program (“PPP”). The business must use the proceeds of the PPP loan on salary costs, mortgage interest, rent, and utilities. Initially, the program allowed for the forgiveness of principal if the business spent the loan proceeds on qualifying expenses within eight weeks of loan issuance and used at least 75% of the loan for payroll. On June 5, 2020, the Paycheck Protection Program Flexibility Act of 2020 came into effect. This law extended the period from eight weeks to 24 weeks during which loan proceeds were to be spent and reduced the requirement that loan proceeds be spent on payroll from 75 percent to 60 percent.

If convicted, Brooks faces a maximum sentence of 20 years in federal prison for wire fraud and money laundering, followed by three years of supervised release. The actual sentences for federal crimes are generally less than the maximum sentences. A federal district court judge will determine any sentence after taking into account U.S. sentencing guidelines and other statutory factors.

An indictment is not a guilty verdict. An individual charged with an indictment is presumed innocent unless and until his guilt has been proven in subsequent criminal proceedings.

Acting United States Attorney Jonathan F. Lenzner commended the FDIC OIG, IRS-CI, FBI, and SBA OIG for their work in the investigation. Mr Lenzner thanked Assistant US Prosecutors Sean R. Delaney, Jessica C. Collins and Jennifer L. Wine, who are pursuing the case.

On May 17, 2021, the Attorney General created the COVID-19 Fraud Enforcement Working Group to mobilize the resources of the Department of Justice in partnership with government agencies to strengthen efforts to combat and prevent the pandemic fraud. The Working Group strengthens efforts to investigate and prosecute the most culpable national and international criminal actors and assists agencies responsible for administering relief programs to prevent fraud, among other methods, by scaling up and integrating mechanisms coordination, identifying resources and techniques for uncovering fraudulent actors and their programs, and sharing and leveraging information and knowledge gained from previous enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.

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 Enforcement (NCDF) hotline at 866-720 -5721 or via the NCDF web complaint form at: https: // www. .justice.gov / disaster-fraud / ncdf-disaster-complaint-form.

For more information on the U.S. Attorney’s Office in Maryland, its priorities, and the resources available to help the community, please visit https://www.justice.gov/usao-md/community-outreach.

# # #

Source link

About Michael Brafford

Check Also

Wine prices are on the rise, so finding good value is important

Prices are rising and wine is not immune to the same economic pressures that drive …

Leave a Reply

Your email address will not be published.