Eleven sentenced in connection with a $3 million Paycheck Protection Program fraud scheme

ATLANTA – Eleven men, eight from the metropolitan Atlanta-area, and three from South Carolina, have been sentenced for their roles in obtaining approximately $3 million in Paycheck Protection Program (PPP) loans on behalf of ten businesses based on Georgia and South Carolina.

“The CARES Act and the PPP designated funds to aid struggling businesses during a pandemic,” said U.S. Attorney Ryan Buchanan. “American businesses needed these funds to keep their companies and employees afloat during a national emergency and world-wide pandemic.  These defendants took advantage of that program to obtain money to which they were not lawfully entitled.  We will continue investigating and prosecuting those who attempt to steal these critical funds.”

“The FBI and our partners will not tolerate anyone who misdirects federal emergency assistance intended for business who actually need it to stay operational," said Keri Farley, Special Agent in Charge of FBI Atlanta. "This sentence serves as a message that the FBI and our federal partners remain committed to making sure funds provided by programs like PPP are used as intended."

“Individuals that conspire to defraud SBA programs will be brought to justice,” said SBA OIG’s Eastern Region Special Agent in Charge Amaleka McCall-Braithwaite.  “These sentences demonstrate that those that defraud the nations vital economic programs will be held accountable. I want to thank the U.S. Department of Justice for its leadership and dedication to pursuing justice.”

“We will continue to aggressively pursue those who defrauded the Paycheck Protection Program which was funded by taxpayers and designed to assist businesses during the pandemic,” said J. Russell George, Treasury Inspector General for Tax Administration.  “We appreciate the efforts by our federal partners and the U.S. Attorney’s Office to hold these individuals to account.”

According to U.S. Attorney Buchanan, the charges and other information presented in court: Rodericque Thompson recruited Micah Baisden, Travis Crosby, Stanley Dorceus, Keith Maloney, Tabronx Smith, Mark Stewart, Timothy Williams, Thomas Wilson, and Kenneth L. Wright, Jr., to apply for fraudulent PPP loans on behalf of their respective businesses:

• PowerHouse Sports Academy, LLC;
• Faithful Transport Services, LLC;
• Elevate Yourself, LLC;
• KMJ Transport, LLC;
• Market Yourself, LLC;
• The Infinity Group of SC, LLC;
• Bamigi Brand;
• Rare Breed Nation, LLC;
• Lux Realty; and
• Lux Automotive.

In exchange for approximately 50 percent of the loan proceeds, Thompson helped each business owner obtain a $300,000 PPP loan by submitting fraudulent loan applications that contained numerous false and misleading statements about their businesses.

For example, each of the loan applications claimed that the relevant business employed 16 individuals and paid monthly wages of $120,000.  Additionally, identical fraudulent quarterly tax returns were submitted in connection with each loan application.  After they received the funds, the business owners wrote “payroll” checks to individuals who did not work for their businesses and then either kept the money for themselves or gave the money to Thompson.  They hoped to hide the fraud and expected to get the loans forgiven by writing “payroll” on the checks. 

Antonio Hosey, who was not a business owner, acted as a go-between with the business owners and Thompson by recruiting a group of check cashers who cashed the false “payroll” checks from the business owner defendants and then gave the cash to Hosey who, in turn, gave it to Thompson.

The group fraudulently obtained approximately $3 million in PPP loans. To date, authorities have recovered approximately $1,195,784.98 of the stolen money.  Ten of the defendants involved in this scheme pleaded guilty.  Travis Crosby, the sole defendant to go to trial, was convicted on September 22, 2022, after a two-day trial.  All of the defendants have received the following sentences:

• Kenneth L. Wright, Jr., 34, of Atlanta, Georgia, was sentenced to one year and one day in prison to be followed by three years supervised release, and ordered to pay restitution in the amount of $242,177.81 on January 8, 2021.  Wright was convicted on August 20, 2020, of conspiracy to defraud the United States and making false statements to a federal agency.  
• Thomas D. Wilson, 32, of Atlanta, Georgia, was sentenced to one year, nine months in prison to be followed by three years of supervised release, and ordered to pay restitution in the amount of $300,000, on October 24, 2022.  Wilson was convicted of bank fraud on April 14, 2021.
• Micah K. Baisden, 31, of Atlanta, Georgia, was sentenced to one year, six months in prison to be followed by three years of supervised release, and order to pay restitution in the amount of $300,000, on November 8, 2022.  Baisden was convicted of bank fraud on May 20, 2021.
• Rodericque Jarmaine Thompson, 45, of Atlanta, Georgia, was sentenced to five years, ten months in prison to be followed by five years of supervised release, and ordered to pay restitution in the amount of $2,732,259.47, on November 9, 2022.  Thompson was convicted of conspiracy to commit bank fraud on May 20, 2021.
• Keith A. Maloney, 35, of Yemassee, South Carolina, was sentenced to one year, three months in prison to be followed by three years supervised release, and ordered to pay restitution in the amount of $114,828.19, on November 10, 2022.  Maloney was convicted of bank fraud on May 4, 2021.
• Antonio D. Hosey, 50, of Atlanta, Georgia, was sentenced to one year and one day in prison to be followed by three years supervised release, and order to pay restitution in the amount of $463,779.79, on November 16, 2022.  Hosey was convicted of conspiracy to defraud the United States on November 19, 2020.
• Stanley Dorceus, 36, of Marietta, Georgia, was sentenced to three months in prison to be followed by three years supervised release, and ordered to pay restitution in the amount of $207,829.85, on November 29, 2022.  Dorceus was convicted of conspiracy to defraud the United States and making false statements to a federal agency on August 26, 2020.
• Mark A. Stewart, 56, of Greenville, South Carolina, was sentenced to four months in prison to be followed by two years supervised release, and ordered to pay restitution in the amount of $300,000, on December 6, 2022.  Steward was convicted of conspiracy to defraud the United States and making false statements to a federal agency on September 25, 2020.
• Timothy Williams, 32, of Atlanta, Georgia, was sentenced to one year, three months in prison to be followed by three years supervised release, and ordered to pay restitution in the amount of $869,427.54, on December 8, 2022.  Williams was convicted of conspiracy to defraud the United States and making false statements to a federal agency on October 13, 2020.
• Tabronx W. Smith, 45, of Buford, Georgia, was sentenced to one year, five months in prison to be followed by two years supervised release, and ordered to pay restitution in the amount of $118,818.45, on December 20, 2022. Smith was convicted of bank fraud on June 8, 2021.
• Travis C. Crosby, 32, of Wellford, South Carolina, was sentenced to three years, ten months in prison to be followed by three years supervised release, and order to pay restitution in the amount of $897,172.61.  Crosby was convicted of conspiracy to commit bank fraud, bank fraud, false statement to a bank, and money laundering.

This case was investigated by the Federal Bureau of Investigation, Small Business Administration – Office of Inspector General, and the Treasury Inspector General for Tax Administration.

Special Assistant U.S. Attorney Diane C. Schulman, Assistant U.S. Attorney Christopher J. Huber, and DOJ Trial Attorneys Michael McCarthy and Matthew Reilly prosecuted 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.

For further information please contact the U.S. Attorney’s Public Affairs Office at USAGAN.PressEmails@usdoj.gov or (404) 581-6016.  The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.