Man charged with $11.5M in COVID-19 pandemic fraud in PA
(28/22 NEWS) — The United States Attorney’s Office for the Middle District of Pennsylvania announced Wednesday that a Maryland man is facing several charges after he falsely filed for pandemic stimulus funds.
The U.S. Attorney’s Office identified the man as Creed White, 65 of Freeland, Maryland.
According to U.S. Attorney Gerard M. Karam, investigators allege that White owned Aluminum Alloys MFG, LLC, an aluminum smelting and processing business located in York County, Pennsylvania.
Officials say White also owned or controlled 18 other sham corporations that did not have any employees or business operations. White allegedly conspired with others, including several of his employees, and filed over 120 applications on behalf of White’s non-operational businesses for pandemic stimulus funds, including under the Payment Protection Program (PPP) and the Economic Injury and Disaster Loan (EIDL) program.
Attorney Karam says the information alleges that 42 of these loan applications were approved and funded with more than $11,500,000 into bank accounts that White was in control of.
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U.S. Attorneys allege the information on the applications White and his co-conspirators filed contained numerous misrepresentations about who owned and operated the non-operational businesses.
Karam says that the PPP and EIDL applications included fraudulent supporting documentation, including false information about the number of employees who reportedly worked at the non-operational businesses, fabricated bank records, financial statements, forged and falsified IRS documents, and material misrepresentations regarding wages paid, taxes withheld and paid, gross receipts, and other expenses allegedly incurred by the applicant businesses.
White and his co-conspirators allegedly obtained more than $11,500,000 in PPP and EIDL funds through filing fraudulent applications. It is also alleged that White misused the loan proceeds to make unauthorized purchases for his benefit and the benefit of his businesses.
“Fraudulently obtaining over $11,500,000 million in federal pandemic relief funds that are meant to provide assistance to eligible small businesses will not be tolerated as shown by today’s charging of Defendant White. My office will continue to diligently work with our law enforcement partners to pursue fraud against federal relief programs,” said U.S. Attorney Karam.
“Individuals making false statements to fraudulently obtain pandemic funds for personal gain will face justice. Our Office will remain relentless in the pursuit of fraudsters who seek to exploit SBA’s vital economic programs. I want to thank the U.S. Attorney’s Office and our law enforcement partners for their dedication and commitment to seeing justice served,” stated SBA OIG’s Eastern Region Special Agent in Charge Amaleka McCall-Brathwaite.
“The charges announced today show IRS-CI’s ongoing commitment to defend the integrity of the pandemic relief programs. IRS-CI along with our law enforcement partners will continue to aggressively investigate those who schemed to defraud these programs that were intended to help struggling individuals and businesses,” said said Yury Kruty, Special Agent in Charge of IRS-Criminal Investigation.
“Treasury OIG is working closely with its law enforcement partners to investigate and prosecute criminals who cheat and steal funds meant to help individuals and businesses harmed by the pandemic,” said Rich Delmar, Treasury Deputy Inspector General.
Officials say the PPP and EIDL programs, both funded by the March 2020 CARES Act, were designed to help small businesses facing financial difficulties during the COVID-19 pandemic. PPP funds were offered in forgivable loans, provided that certain criteria were met, including the use of the funds for employee payroll, mortgage interest, lease, and utility expenses. EIDL funds are offered in low-interest rate loans, designated for specific business expenses, such as fixed debts, payroll, and business obligations.
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White is charged in a criminal information with conspiracy to commit wire fraud and engage in an unlawful monetary transaction.
The combined maximum penalty under federal law for wire fraud and money laundering is 30 years of imprisonment, a term of supervised release following imprisonment, and a fine. A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across the government to enhance efforts to combat and prevent pandemic-related fraud.
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 (NCDF) Hotline at (866)-720-5721 or via the NCDF Web Complaint Form on the DOJ’s website.
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