3 from Michigan charged in fraud scheme in COVID business loan program
Three Michigan residents were among 17 people charged in an $11 million fraud scheme involving Paycheck Protection Program loans.
Between May and August 2020, the 17 defendants allegedly submitted or helped in the submission of PPP loan applications seeking $800,000 each for 14 businesses, said the U.S. Department of Justice.
To receive the money, the defendants allegedly submitted fraudulent IRS Form 941s, which are used by businesses to report payroll taxes.
After the loans were received by the businesses, the defendants allegedly disguised the way they distributed the money to conspirators and disguised the ways the money was spent, said the Justice Department. The loans were distributed by the Small Business Administration to help employers keep their workforce employed during the COVID pandemic. The program ended in May, according to the SBA website.
The money from the loans was used to buy jewelry and luxury vehicles, including two Range Rovers, an Acura NSX and a Mercedes Benz S-Class s65 AMG, the Justice Department said in a news release Thursday.
The three Michiganians charged in the alleged scheme are Ricky Dixon, Derek Parker and Charmaine Redding.
Dixon, 52, of Warren is charged with conspiracy to commit bank fraud and wire fraud, bank fraud, wire fraud, false statements to a federally insured financial institution, aggravated identity theft and money laundering.
He was involved in obtaining several loans, including one for his business, RK Painting Co., authorities allege.
Parker, 56, of Rochester Hills is charged with conspiracy to commit wire fraud, wire fraud and money laundering. His business, D Parker Holdings Inc., obtained a loan, the Justice Department alleged.
Redding, 27, of Macomb is charged with conspiracy to commit wire fraud in connection with a loan obtained by her business, All Star Room and Board Services of Michigan Inc., according to a release by the Justice Department.
If convicted, the defendants face up to 20 years in prison on the wire fraud and money laundering charges, and up to 30 years on the bank fraud and false statement to a federally insured financial institution charges.
Dixon also faces an additional two-year sentence on the aggravated identity theft charge.