Two Men Plead Guilty in Multimillion-Dollar COVID-19 Relief Scheme
Two individuals pleaded guilty today in the Southern District of Texas for their participation in a scheme to fraudulently obtain and launder millions of dollars in forgivable Paycheck Protection Program (PPP) loans guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security Act.
According to court documents, Siddiq Azeemuddin, 42, of Naperville, Illinois, and Raheel Malik, 41, of Sugar Land, Texas, engaged in a scheme to defraud the SBA and certain SBA-approved PPP lenders by submitting false and fraudulent PPP loan applications. Azeemuddin and Malik also conspired to and did launder over $3 million in PPP loan funds through Azeemuddin’s business, Fascare International Inc., dba Almeda Discount Store (Almeda). As part of the scheme, Azeemuddin instructed Malik to fill out blank checks from companies that received PPP loans by putting the names of fake employees in the payee line. At Azeemuddin’s direction, Malik then cashed the checks at a financial institution and then transported the cash to other members of the conspiracy. In exchange for laundering the funds, Azeemuddin received 1% to 2% of each check cashed.
Azeemuddin pleaded guilty to one count of conspiracy to commit wire fraud and one count of money laundering. He is scheduled to be sentenced on March 7, 2022, and faces a maximum total penalty of 40 years in prison. Malik pleaded guilty to one count of conspiracy to commit wire fraud and money laundering. He is scheduled to be sentenced on March 7, 2022, and faces a maximum penalty of five years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division; Acting U.S. Attorney Jennifer Lowery for the Southern District of Texas; Inspector General Hannibal “Mike” Ware of the SBA–Office of Inspector General (SBA-OIG); Special Agent in Charge Catherine Huber of the Federal Housing Finance Agency–Office of Inspector General (FHFA-OIG); Special Agent in Charge Mark B. Dawson of Homeland Security Investigations (HSI) Houston; Inspector General Jay N. Lerner of the Federal Deposit Insurance Corporation–Office of Inspector General (FDIC-OIG); and Inspector General J. Russell George of the Treasury Inspector General for Tax Administration (TIGTA) made the announcement.
The SBA-OIG, FHFA-OIG, HSI, FDIC-OIG, and TIGTA are investigating the case.
Trial Attorneys Louis Manzo and Della Sentilles of the Criminal Division’s Fraud Section and Assistant U.S. Attorneys Rodolfo Ramirez and Kristine Rollinson of the Southern District of Texas are prosecuting the case.
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 government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior 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 (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.