US-Indian engineer pleads guilty to $ 10 million emergency relief fraud charge
An Indo-American engineer in the United States has pleaded guilty to soliciting more than $ 10 million in loans as part of a coronavirus relief program set up to help small businesses, he said. said the Department of Justice.
Shashank Rai, 30, pleaded guilty Thursday to one count of making false statements to a bank.
He was charged on May 13, 2020 with wire fraud violations, bank fraud, making false statements to a financial institution, and making false statements to the Small Business Administration (SBA).
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As part of his guilty plea, Rai admitted that he applied for millions of dollars in SBA-guaranteed forgivable loans from two different banks claiming to have 250 paid employees when in fact no employee was working. for his alleged business.
Rai made two fraudulent claims to two different lenders to apply for SBA-guaranteed loans for COVID-19 relief through the Paycheck Protection Program (PPP).
In the application submitted to the first lender, Rai requested $ 10 million in PPP loan products by fraudulently claiming to have 250 employees with an average monthly payroll of $ 4 million.
In the second request, Rai requested about $ 3 million in PPP loan products by fraudulently claiming to have 250 employees with an average monthly payroll of around $ 1.2 million.
According to court documents, the Texas Workforce Commission provided investigators with information that no records of employee wages were paid in 2020 by Rai or his alleged company, Rai Family LLC.
Additionally, the Texas Comptroller Office of Public Accounts reported to investigators that Rai Family LLC did not report any income for the fourth quarter of 2019 or the first quarter of 2020.
According to court documents, materials recovered from the garbage outside Rai’s residence included handwritten notes that appear to reflect an investment strategy for the $ 3 million, the amount Rai allegedly requested from the second lender.
“The Payroll Protection Program was designed to help struggling businesses and hard-working Americans, not individuals who whip up imaginary businesses and employees,” Acting US Attorney Nicholas J Ganjei said.
“We will continue to work diligently with our law enforcement partners to investigate and prosecute those who operate this essential taxpayer-funded program,” he said.
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