PPP and EIDL Loan Scam: Man Pleads Guilty to Wire Fraud Conspiracy

Strategic Insights -

Shawn Nicholas Young, a 42-year-old man, has pleaded guilty to a wire fraud conspiracy involving the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) program in the Southern District of Texas. Young applied for PPP and EIDL loans on behalf of his own businesses as well as businesses belonging to others, misrepresenting key information and using fake tax returns and backdated documents to support the false statements. Over the conspiracy, Young submitted more than 100 fraudulent applications, requesting more than $9.5 million in funds earmarked for pandemic relief, and received kickbacks from co-conspirators who were approved for loans. Young profited $1.65 million from the conspiracy, using the proceeds for personal expenses such as paying off his mortgage and buying a car. As part of his plea, Young will pay full restitution to the victims of his crimes and forfeit his house and car.

Key Takeaways:

  • Shawn Nicholas Young pleaded guilty to a wire fraud conspiracy involving the PPP and EIDL program, with a total of 105 fraudulent applications submitted, requesting over $9.5 million in funds.
  • Young misrepresented key information about the businesses and supported the false statements with fake tax returns and backdated documents.
  • He received kickbacks from co-conspirators who were approved for loans and profited $1.65 million from the conspiracy.
  • Young used the proceeds for personal expenses, including paying off his mortgage and buying a car.
  • As part of his plea, Young will pay full restitution to the victims of his crimes and forfeit his house and car.
  • Young faces up to 20 years in federal prison and a possible $250,000 maximum fine.
  • The case was investigated by multiple agencies, including the Federal Housing Finance Agency-Office of Inspector General, Treasury Inspector General for Tax Administration, and Federal Deposit Insurance Corporation-OIG.
  • Assistant U.S. Attorneys Stephanie Bauman and Shirin Hakimzadeh prosecuted the case, with the assistance of the COVID-19 Fraud Enforcement Task Force.

Statistics:

  • 105: The number of fraudulent applications submitted by Shawn Nicholas Young.
  • $9.5 million: The total amount of funds requested in the fraudulent applications.
  • $1.65 million: The amount of profits made by Young from the conspiracy.
  • $250,000: The maximum fine faced by Young.
  • 20 years: The maximum prison sentence faced by Young.
  • 10/27: The date scheduled for Young's sentencing hearing.

Sources:

  • United States Attorney's Office for the Southern District of Texas
  • Federal Housing Finance Agency-Office of Inspector General (OIG)
  • Treasury Inspector General for Tax Administration
  • Federal Deposit Insurance Corporation-OIG
  • SBA-OIG
  • Immigration and Customs Enforcement - Homeland Security Investigations
  • COVID-19 Fraud Enforcement Task Force