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Press Release

Commerce Township Man Pleads Guilty in Pandemic Loan Fraud Scheme

For Immediate Release
U.S. Attorney's Office, Eastern District of Michigan

DETROIT - A Commerce Township resident pleaded guilty today to orchestrating a fraud scheme involving approximately $851,000 in loans intended to help small businesses stay afloat during the Covid-19 pandemic, United States Attorney Dawn N. Ison announced today.

Joining in the announcement was Angie M. Salazar, Special Agent in Charge of the Detroit Field Office of Homeland Security Investigations (HSI).

Ryan Carruthers, 32, entered a plea of guilty to one count of wire fraud before United States District Judge Paul D. Borman. The guilty plea arose out of Carruthers’ participation in a wide-ranging scheme to  fraudulently obtain loans from two pandemic relief programs overseen by the Small Business Administration (SBA). 

“Ryan Carruthers stole nearly a million dollars from programs intended to help our community weather an unprecedented national crisis. Every dollar that went to Mr. Carruthers is a dollar that did not go to a small business that needed help during the pandemic,” said United States Attorney Ison. “My office takes pandemic fraud extremely seriously, and we will continue to dedicate resources to bringing those who perpetrated such frauds to justice.”

“This case shows the efforts some will take to defraud their fellow community members and taxpayers,” said HSI Detroit Special Agent in Charge Angie M. Salazar. “Today, three years after the start of the pandemic, we are still investigating fraud and working to ensure that those who received this money did so honestly and justly. The message should be clear for anyone who stole these funds for personal enrichment, our HSI agents and partners are committed to holding you accountable.”

According to the plea agreement, in approximately April 2020, Carruthers began to submit electronic applications for pandemic relief loans in the names of various business entities he purported to own and control. Between April 2020 and April 2021, Carruthers submitted 12 loan applications through the ‘’Paycheck Protection Program,” (PPP), which was an SBA-administered program that provided forgivable loans to businesses to encourage them to keep workers employed during the pandemic. Carruthers also submitted a loan application under the SBA’s ‘’Economic Injury Disaster Loan Program” (EIDL), which was a program that provided low-interest financing to businesses adversely affected by the pandemic.

According to the plea documents, the loan applications described above contained numerous material misrepresentations and false statements. Carruthers’s business entities were shell businesses that existed on paper only; they had no revenue, employees, or ongoing operations of any sort. However, Carruthers claimed in his applications that each of these entities had between three and 15 employees. The average monthly payroll amounts included in the applications were fictitious, as were representations about how the money would be spent.

Carruthers received approximately $851,963 in proceeds from the 13 loans that were funded as part of his scheme. According to the plea documents, Carruthers used these fraudulently obtained monies to, among other things, pay off the mortgage on his home, purchase a personal watercraft, and pay various personal expenses.

Sentencing is set for December 5, 2023 before Judge Borman.

The case is being prosecuted by Assistant United States Attorney John K. Neal. The investigation was conducted by HSI.

Updated August 7, 2023