Court filing
Indictment — United States v. Dortatius L. Hill — United States v. Kenneth C. Sparks III et al. (E.D. Mo., 2024-09-04)
Filed September 4, 2024 in United States v. Kenneth C. Sparks III et al.; one of 5 filings from this case.
Record facts
| Court | U.S. District Court for the Eastern District of Missouri, Eastern Division |
|---|---|
| Filed | 2024-09-04 |
U.S. District Court for the Eastern District of Missouri, Eastern Division · No. 4:24-cr-00460-SEP · Doc. 2 · 2024-09-04 · Docket on CourtListener
Full text
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
EASTERN DIVISION
UNITED STATES OF AMERICA,
Plaintiff,
FILED
SEP - 4 2024
U. S. DISTRICT COURT
EASTERN DISTRICT OF MO
ST. LOUIS
V.
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4:24CR460 SEP/PLC
DORTATIUS L. HILL,
Defendant.
INDICTMENT
The Grand Jury charges that:
INTRODUCTION
At all times material to this Indictment, unless otherwise specified below:
Defendant and Associated Businesses
I.
DefendantDORTATIUSL. HILL ("HILL")was a residentofthe Eastern District
of Missouri.
2.
HILL claimed to have a personal business under the name "Dortatius Hill"
established on January I, 2020. The business was not registered with the Missouri Secretary of
State.
3.
HILL was the owner of and signatory for the following financial accounts:
a.
Stride Bank account number xxxxxx7682, in the name of HILL, and linked
to Chime Visa Prepaid Card xxxxxxxx8240 ("Chime Visa") and
b.
JPChase Morgan checking account number xxxxx7223 in the name of
HILL ("Chase'').
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The Paycheck Protection Program
4.
The Paycheck Protection Program ("PPP") was a COVID-19 pandemic relief
program administered by the Small Business Administration ("SBA") that provided forgivable
loans to small businesses for job retention and certain other expenses. The PPP permitted
participating third-party lenders to approve and disburse SBA-backed PPP loans to cover payroll,
fixed debts, utilities, rent/mortgage, accounts payable and other bills incurred by qualifying
businesses during, and resulting from, the COVID-19 pandemic. PPP loans were fully guaranteed
by the SBA.
5.
To obtain a PPP loan, a qualifying business had to submit a PPP loan application,
which was signed by an authorized representative of the business. The PPP loan application
required the business (through its authorized representative )to acknowledge the program rules and
make certain affirmative certifications to be eligible to obtain the PPP loan, including that the
business was in operation and either had employees for whom it paid salaries and payroll taxes or
paid independent contractors. A business applying for a PPP loan was required to provide
documentation showing its payroll expenses, such as filed federal income tax documents.
6.
The types of businesses eligible for a PPP loan included individuals who were self-
employed or operated as a sole proprietorship, and who did not have any employees. The PPP
loan application for a self-employed individual or sole proprietorship required such an individual
to certify the individual's annual income or net profit, as typically reported to the Internal Revenue
Service on Form 1040, Schedule C, for a given tax year and to provide documentation showing
the individual's annual income or net profit.
7.
PPP loan applications were electronically submitted or caused to be submitted by
the borrower and received through SBA servers located in Virginia or Oregon. Once approved, the
business received the PPP loan proceeds via an electronic funds transfer from the third-party lender
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to a financial account under the control of the business.
8.
The proceeds of a PPP loan could be used for certain specified items, such as payroll
costs, mortgage interest payments, rent, and utilities for the business. The proceeds of a PPP loan
were not permitted to be used by the borrower to purchase consumer goods or to fund the
borrower's ordinary day-to-day living expenses unrelated to the specified authorized expenses.
9.
To obtain forgiveness of a PPP loan, a borrower had to submit a PPP loan
forgiveness application. In the forgiveness application, a borrower had to certify that the loan
proceeds had been spent on payroll costs and other permitted expenses. Once approved for
forgiveness, a borrower would owe nothing and would have no obligation to repay the PPP loan.
10.
Borrowers who received a PPP loan were, in certain circumstances, permitted to
apply for a second PPP loan, referred to as a "Second Draw" PPP loan. In the application for a
Second Draw PPP loan, a borrower had to also certify that he or she had used the first PPP loan
only for permitted expenses. A borrower was also required to demonstrate atleasta25% reduction
in gross receipts between comparable quarters in 2019 and 2020.
11.
Harvest Small Business Finance, LLC ("Harvest") was a third-party participating
lender located in California which participated in the PPP and was a financial institution within
the meaning of Title 18, United States Code, Section 20, the deposits of which are insured by the
Federal Deposit Insurance Corporation. After Harvest approved a PPP loan application, Harvest
initiated an interstate electronic funds transfer of PPP loan proceeds from Harvest servers to Stride
Bank servers located in Oklahoma.
The Scheme
12.
Beginning no later than in or around April 2021, and continuing until through at
least in or around May 2021, in the Eastern District of Missouri and elsewhere, the defendant,
DORTATIUS L. HILL,
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with intent to defraud, devised and intended to devise a scheme and artifice to defraud a third-party
participating lender in the PPP, and to obtain money and property from that lender by means of
materially false and fraudulent pretenses, representations, and promises, by submitting fraudulent
applications for PPP loans on behalf of his business.
Manner and Means
Dortatius Hill PPP Loan
13.
It was part of the scheme that, on or about April 2, 2021, and on April 9, 2021,
HILL submitted and caused to be submitted two fraudulent PPP loan applications on behalf of
Dortatius Hill to Harvest, with the intent to obtain loan proceeds from Harvest.
14.
It was further part of the scheme that HILL marked 2019 as the tax year used for
gross income, listed a total numberof employees as one, and reported $120,000.00as the business'
total amount of gross income.
15.
It was further part of the scheme that HILL submitted a 2020 Schedule C, Profit or
Loss from Business, IRS form as supporting documentation for both loan applications.
16.
It was further part of the scheme that HILL falsely claimed that the funds would
be used for payroll costs.
1 7.
It was further part of the scheme that as a result of HILL'S false and fraudulent
representations in the PPP application he had submitted to Harvest, Harvest approved his PPP loan
applications.
18.
It was further part of the scheme that HILL caused Harvest to disburse, on or about
April 16, 2021, approximately $20,833 in PPP loan proceeds to his Stride account.
19.
It was further part of the scheme that HILL caused Harvest to disburse, on or about
May 5, 2021, approximately $20,833 in PPP loan proceeds to his Stride account.
20.
It was further part of the scheme that HILL transferred PPP loan proceeds from his
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Stride account to his Chase account.
21.
It was further part of the scheme that as a result of HILL'S false and fraudulent
representations in the forgiveness applications that, on or about September 13, 2021, the SBA
forgave the PPP loans for Dortatius Hill.
COUNTS 1-11
Bank Fraud (18 U.S.C. § 1344)
22.
Paragraphs 1 through 21 are realleged and incorporated by reference as if fully set
forth herein.
23.
On or about the dates set forth below, in the Eastern District of Missouri, and
elsewhere, the defendant,
DORTATIUS L. HILL,
executed and attempted to execute the scheme and artifice described above, to defraud a financial
institution as defined in Title 18, United States Code, Section 20, and to obtain moneys, funds,
credits, assets, securities, and other property owned by and under the custody and control of a
financial institution, by means of materially false and fraudulent pretenses, representations, and
promises, in that HILL submitted and caused to be submitted fraudulent PPP loan applications to
third-party participating lenders in the PPP, as described below for each count, each submission
constituting a separate count:
Count
Aoorox. Date
Summary
I
April 2, 2021
HILL submitted and caused to be submitted a fraudulent PPP
loan application for approximately $20,833 on behalf of
Dortatius Hill to Harvest Small Business Finance, LLC.
II
April 9, 2021
HILL submitted and caused to be submitted a fraudulent PPP
loan application for approximately $20,833 on behalf of
Dortatius Hill to Harvest Small Business Finance, LLC.
All in violation of Title 18, United States Code, section 1344.
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COUNTS III- IV
Wire Fraud (18 U.S.C. § 1343)
24.
Paragraphs 1 through 21 are realleged and incorporated by reference as if fully set
forth herein.
25.
On or about the dates set forth below, in the Eastern District of Missouri, and
elsewhere, the def end ant,
DORTATIUS L. HILL,
having devised and intended to devise a scheme to defraud and to obtain money by means of
materially false and fraudulent pretenses, representations, and promises, for the purpose of
executing the scheme described above, caused to be transmitted by means of wire communication
in interstate commerce the signals and sounds described below for each count, each transmission
constituting a separate count:
Count
Approx. Date
Summary
Loan Amount
III
April 16, 2021
An interstate wire communication
$20,833
initiated from Harvest servers to Stride
Bank servers, consisting of the
electronic funds transfer of PPP loan
proceeds for Dortatius Hill into HILL'S
Stride account.
IV
May 5, 2021
An interstate wire communication
$20,833
initiated from Harvest servers to Stride
Bank servers, consisting of the
electronic funds transfer of PPP loan
proceeds for Dortatius Hill into HILL'S
Stride account.
All in violation of Title 18, United States Code, Section 1343.
COUNTV
Material False Statement (18 U.S.C. § 1001(a)(2))
26.
Paragraphs 1 through 21 are re alleged and incorporated by reference as if fully set
forth herein.
2 7.
On or about April 2, 2021, within the Eastern District of Missouri, and elsewhere,
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the defendant,
DORTATIUS HILL,
did knowingly and willfully make, and cause to be made, a materially false, fictitious, and
fraudulent statement and representation in a matter within the jurisdiction of the United States
Small Business Administration ("SBA"), an agency within the executive branch of the
Government of the United States, namely the statement on a "Paycheck Protection Program
Borrower Application Form for Schedule C Filers Using Gross Income" that he was the sole
proprietor of a business located in Saint Louis, Missouri, that had gross income of $120,000.00
during the 2019 tax year.
All in violation of Title 18, United States Code, Section I 00 I (a)(2).
SAYLER A. FLEMING
United States Attorney
JENNIFER J. ROY, #47203MO
Assistant United States Attorney
A TRUE BILL.
FOREPERSON
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Case: 4:24-cr-00460-SEP Doc. #: 2 Filed: 09/04/24 Page: 7 of 7 PageID #: 16File and source
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