Plea Agreement — No. 2:20-cr-20355 (Dkt. 17, E.D. Mich.)

Summary

A plea agreement filed September 11, 2020 in United States v. Darrell Baker, Case No. 20-CR-20355, in the U.S. District Court for the Eastern District of Michigan, before Hon. Laurie J. Michaelson. Baker agrees to waive indictment and plead guilty to Count 1 of the Information, bank fraud under 18 U.S.C. § 1344(1), and Count 2, money laundering under 18 U.S.C. § 1957. The listed maximums are 30 years and a $1,000,000 fine for Count 1 and 10 years and a $250,000 fine for Count 2. In the factual basis, Baker obtained a PPP loan from Customers Bank for Motor City Solar Energy, Inc after representing that it had 68 employees.

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Case 2:20-cr-20355-LJM-EAS ECF No. 17, PagelD.50 Filed 09/11/20 Page 1 of 23

United States District Court
Eastern District of Michigan
Southern Division

United States of America,

Plaintiff, |
Hon. Laurie J. Michaelson
Vv.
Case No. 20-CR-20355
Darrell Baker,
Defendant.

/

Plea Agreement

The United States of America and the defendant, Darrell Baker,
have reached a plea agreement under Federal Rule of Criminal
Procedure 11. The plea agreement’s terms are:

1. Counts of Conviction

The defendant will waive his right to an indictment and will plead
guilty to Counts 1 and 2 of the Information. Count 1 charges the
defendant with Bank Fraud under 18 U.S.C. § 1344(1). Count 2 charges

the defendant with Money Laundering under 18 U.S.C. § 1957.

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2. Statutory Minimum and Maximum Penalties

The defendant understands that the counts to which he is

pleading guilty carry the following minimum and maximum statutory |

penalties:
Count 1 Term of imprisonment: 30 years
Fine: $1,000,000
Term of supervised release 5 years
Count 2 Term of imprisonment: 10 years
Fine: $250,000
Term of supervised release: 3 years

The defendant further understands that the Court has the
discretion to run the sentences of imprisonment on the counts of
conviction consecutively to each other.

3. Agreement Not to Bring Additional Charges

If the Court accepts this agreement and imposes sentence
consistent with its terms, the United States Attorney’s Office for the

Eastern District of Michigan will not bring additional charges against

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the defendant for the conduct reflected in the factual basis of this

agreement.

4. Elements of Count[s] of Conviction

The elements of Count 1 are:
(A) First: That the defendant knowingly executed a scheme or
artifice to defraud a financial institution;
(B) Second, that the defendant did so did so with the intent to
defraud the financial institution; and
(C) That the financial institution was then insured by the Federal
Deposit Insurance Corporation.
The elements of Count 2 are:
(A) First, that the defendant knowingly engaged in a monetary
transaction.
(B) Second, that the monetary transaction was in property derived from
specified unlawful activity.
(C) Third, that the property had a value greater than $10,000.
(D) Fourth, that the defendant knew that the transaction was in

criminally derived property.

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(FE) Fifth, that the monetary transaction took place within the United

States.

5. Factual Basis

The parties agree that the following facts are true, accurately
describe the defendant’s role in the offenses, and provide a sufficient

factual basis for the defendant’s guilty plea:

The “Paycheck Protection Program” (PPP) is a program administered by the
_ U.S. Small Business Association (SBA) that helps businesses keep their
workforces employed during the coronavirus crisis. Enacted on March 27, 2020 as
a part of the CARES Act, the program is designed to provide a direct incentive for
small businesses to keep their workers on the payroll during the pandemic. The
PPP enables businesses to obtain forgivable loans from participating financial
institutions. The SBA will forgive the loans if all employees are kept on the payroll
for eight weeks and the money is used for payroll, rent, mortgage interest, or
utilities.

In May, 2020, Defendant Darrell Baker, a resident of Detroit, Michigan
applied for and obtained a PPP loan on behalf a business he purported to own,
Motor City Solar Energy, Inc (Motor City). Baker obtained this PPP loan from

Customers Bank, a Pennsylvania-based financial institution that serves as a

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participating lender in the program. Customers Bank is insured by the Federal
Deposit Insurance Corporation.

In his application for the PPP loan, Baker represented that Motor City had
68 employees and, that his 2019 payroll expenses totaled some $2.8 million.
Baker submitted documentation as part of his application package, including
supposed tax filings, that purported to support these claims. Customers Bank
provided Motor City with a $590,000 PPP loan, wired from Pennsylvania to an
account Baker controlled at Michigan First Credit Union in Southfield, Michigan.

In fact, Baker’s representations in his application for the PPP loan were
false, as was the supporting documentation. Motor City had no employees, no
payroll expenses of any kind, and was not an operational business. Baker
submitted these false statements in his seritlietints as part of a scheme to defraud
Customers Bank and the PPP, and did so with the intent to defraud.

Baker managed to withdraw approximately $172,000 of the $590,000 he
obtained before Michigan First Credit Union froze the remaining funds, which
were ultimately returned to Customers Bank. Baker spent these monies on, among
other things, four expensive (though used) automobiles, specifically two Cadillac
Escalades, a Dodge Charger, and a Hummer. Baker purchased these vehicles from
a dealership in Redford, Michigan. He paid for these four automobiles with

cashier’s checks he obtained from Michigan First Credit Union, and each of the

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four checks were in amounts that exceeded $10,000. The proceeds of these
financial transactions were in fact derived from specified unlawful activity
(specifically bank fraud), and Baker knew that these proceeds were the fruits of his
own criminal conduct. |

6. Advice of Rights

The defendant has read the Information, has discussed the
charges and possible defenses with his attorney, and understands the
crimes charged. The defendant understands that, by pleading guilty, he
is waiving many important rights, including the following:

A. The right to plead not guilty and to persist in that plea;

B. The right to a speedy and public trial by jury;

C. The right to the assistance of an attorney at every critical

stage of the proceedings, including trial;

D. The right to an appointed attorney, if the defendant cannot

afford to retain one;

E. The right to be presumed innocent and to require the

government to prove the defendant guilty beyond a reasonable

doubt at trial;

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F. The right to confront and cross-examine adverse witnesses
at trial;

G. The right to testify or not to testify at trial, whichever the
defendant chooses;

H. Ifthe defendant chooses not to testify, the right to have the
jury informed that it may not treat that choice as evidence of guilt;
I. The right to present evidence or not to present evidence at
trial, whichever the defendant chooses; and

J. The right to compel the attendance of witnesses at trial.

7. Collateral Consequences of Conviction

The defendant understands that his convictions here may carry
additional consequences under federal or state law. The defendant
understands that, if he is not a United States citizen, his convictions
here may require him to be removed from the United States, denied
citizenship, and denied admission to the United States in the future.
The defendant further understands that the additional consequences of
his convictions here may include, but are not limited to, adverse effects
on the defendant’s immigration status, naturalized citizenship, right to

vote, right to carry a firearm, right to serve on a jury, and ability to hold

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certain licenses or to be employed in certain fields. The defendant
understands that no one, including the defendant’s attorney or the
Court, can predict to a certainty what the additional consequences of
the defendant’s conviction[s] might be. The defendant nevertheless
affirms that the defendant chooses to plead guilty regardless of any
immigration or other consequences from his[her] conviction|[s].

8. Defendant’s Guideline Range
A. Court’s Determination

The Court will determine the defendant’s guideline range at
sentencing.

B. Acceptance of Responsibility

The government recommends under Federal Rule of Criminal
Procedure 11(c)(1)(B) that the defendant receive a two-level reduction
for acceptance of responsibility under USSG § 3E1.1(a). Further, if the
defendant’s offense level is 16 or greater and the defendant is awarded
the two-level reduction under USSG § 3H1.1(a), the government
recommends that the defendant receive an additional one-level
reduction for acceptance of responsibility under USSG § 3E1.1(b). If,

however, the government learns that the defendant has engaged in any

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conduct inconsistent with acceptance of responsibility—including, but
not limited to, making any false statement to, or withholding
information from, his probation officer; obstructing justice in any way;
denying his guilt on the offense(s) to which he is pleading guilty;
committing additional crimes after pleading guilty; or otherwise
demonstrating a lack of acceptance of responsibility as defined in USSG
§ 3E1.1—the government will be released from its obligations under
this paragraph, will be free to argue that the defendant not receive any
reduction for acceptance of responsibility under USSG § 3E1.1, and will
be free to argue that the defendant receive an enhancement for
obstruction of justice under USSG § 8C1.1.

C. Other Guideline Recommendations

The parties agree that, based on defendant’s plea of guilty to
Count 2 of the Information (Money Laundering), 1 point should be
added to the defendant’s Base Offense Level for his Bank Fraud

Offense. USSG Section 281.1(a)(1), (b)(2)(A).

The parties have no other recommendations as to the defendant’s

guideline calculation.

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D. Factual Stipulations for Sentencing Purposes

The parties have no additional factual stipulations for sentencing
purposes.

E. Parties’ Obligations

Both the defendant and the government agree not to take any
position or make any statement that is inconsistent with any of the
guideline recommendations or factual stipulations in paragraphs 8.B,
8.C, or 8.D. Other than the guideline recommendations and factual
stipulations in those paragraphs, however, neither party is restricted in
what it may argue or present to the Court as to the defendant’s
guideline calculation.

F. Nota Basis to Withdraw

The defendant understands that he will have no right to withdraw
from this agreement or withdraw his[her] guilty plea if he disagrees, in
any way, with the guideline —_— determined by the Court, even if that
guideline range does not incorporate the parties’ recommendations or
factual stipulations in paragraphs 8.B, 8.C, or 8.D. The government
likewise has no right to withdraw from this agreement if it disagrees

with the guideline range determined by the Court.

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9. Imposition of Sentence
A. Court's Obligation

The defendant understands that in determining his sentence, the
Court must calculate the applicable guideline range at sentencing and
must consider that range, any possible departures under the sentencing
guidelines, and the sentencing factors listed in 18 U.S.C. § 3553(a), and
apply any applicable mandatory minimums.

B. Imprisonment

1. Recommendation
Under Federal Rule of Criminal Procedure 11(c)(1)(B), the
government recommends that the defendant’s sentence of imprisonment
not exceed the midpoint of the defendant’s guideline range as
determined by the Court.
2. No Right to Withdraw
The government’s recommendation in paragraph 14.B.1 is not
binding on the Court. The defendant understands that he will have no
right to withdraw from this agreement or withdraw his guilty plea if the
Court decides not to follow the government’s recommendation. The

government likewise has no right to withdraw from this agreement if

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the Court decides not to follow the government’s recommendation. If
however, the Court rejects or purports to reject any other term or terms
of this plea agreement, the government will be permitted to withdraw
from the agreement.

C. Supervised Release
1. Recommendation

Under Federal Rule of Criminal Procedure 11(c)(1)(B), the parties
recommend that the Court impose a three-year term of supervised

release.

2. No Right to Withdraw

The parties’ recommendation is not binding on the Court. The
defendant understands that he will have no right to withdraw from this
agreement or withdraw his guilty plea if the Court decides not to follow
the parties’ recommendation. The defendant also understands that the
government's recommendation concerning the length of the defendant’s
sentence of imprisonment, as described above in paragraph 14.B.1, will
not apply to or limit any term of imprisonment that results from any

later revocation of the defendant’s supervised release.

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D. Fines

There is no recommendation or agreement as to a fine.

EK. Restitution

The Court must order restitution to every identifiable victim of
the defendant’s offense. There is no recommendation or agreement on
restitution. The Court will determine at sentencing who the victims are
and the amounts of restitution they are owed.

The defendant agrees that restitution is due and payable
immediately after the judgment is entered and is subject to immediate
enforcement, in full, by the United States. 18 U.S.C. §§ 3612(c) and
3613. If the Court imposes a schedule of payments, the defendant
agrees that the schedule of payments is a schedule of the minimum
payment due, and that the payment schedule does not prohibit or limit
the methods by which the United States may immediately enforce the
judgment in full.

The defendant agrees to make a full presentence disclosure of his
financial status to the United States Attorney’s Office by completing a
Financial Disclosure Form and the accompanying releases for the

purpose of determining his ability to pay restitution. The defendant

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agrees to complete and return the Financial Disclosure Form within
three weeks of receiving it from government counsel. The defendant
agrees to participate in a presentencing debtor’s examination if
requested to do so by government counsel.

F. Forfeiture

Pursuant to 18 U.S.C. § 982(a)(1) and (2), and 18 U.S.C. §
981(a)(1)(C) with 28 U.S.C. § 2461(c), Defendant agrees to forfeit to the
United States his interest in (a) any property constituting, or derived
from, proceeds defendant obtained directly or indirectly, as the result of
his violation of 18 U.S.C. § 1844, (b) all property, real and personal,
which constitutes or is derived, directly or indirectly, from gross
proceeds traceable to Defendant’s conspiracy to commit wire fraud, in
violation of 18 U.S.C. § 13844, and (c) any property, real or personal,
involved in defendant’s violation of 18 U.S.C. § 1957, or any property
traceable to such property.

Specifically, Defendant agrees to forfeit to the United States, his
interest in the following:

a. 2015 Cadillac Escalade, VIN 1GYS4NKJ7FR587893

b. 2018 Dodge Charger, VIN 2C3CDXGJ4JH220865

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Case 2:20-cr-20355-LJM-EAS ECF No. 17, PagelD.64 Filed 09/11/20 Page 15 of 23

C. 2012 Cadillac Escalade, VIN 1GYS4KEF3CR128099

d. 2007 Hummer H2 VIN, 5GRGN23UX7H103219
(“Subject Vehicles”)

In addition, Defendant agrees to the entry of a forfeiture money
judgment against him in favor of the United States in the amount of
$172,484.40, representing the total value of the property subject to
forfeiture for Defendant’s violations to which he is pleading guilty, to
the extent such value is not satisfied by the specific forfeitures set forth
above.

Defendant agrees that the forfeiture money judgment may be
satisfied, to whatever extent possible, from any property owned or
under the control of Defendant. To satisfy the money judgment,
Defendant explicitly agrees to the forfeiture of any assets as he has
now, or may later acquire, as substitute assets under 21 U.S.C. §
853(p)(2) and waives and relinquishes his rights to oppose the forfeiture
of substitute assets under 21 U.S.C. § 853(p)(1) or otherwise.

Defendant agrees to the entry of one or more orders of forfeiture
incorporating forfeiture of the assets enumerated in this section,

including the Court’s prompt entry of a Preliminary Order of Forfeiture,

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following Defendant’s guilty plea, upon application by the United
States, at, or any time before, his sentencing in this case, as mandated
by Fed. R. Crim. P. 32.2. Defendant agrees to sign such an order,
indicating he consents to its entry if requested to do so by the
Government.

Defendant agrees that he will cooperate with the United States by
taking whatever steps are necessary to deliver clear title to property
subject to forfeiture under this agreement to the United States and will
execute such legal documents as may be required to transfer rights,
title, and ownership to the United States and by taking whatever steps
are necessary to ensure that the property is not sold, disbursed, hidden,
wasted, or otherwise made unavailable for forfeiture.

Defendant acknowledges that he understands that the forfeiture
of assets is part of the sentence that may be imposed in this case and
waives any failure by the Court to advise him of this, pursuant to Fed.
R. Crim. P. 11(b)(1)(J), or otherwise, at the time of his guilty plea is
accepted.

In entering into this agreement with respect to forfeiture,

Defendant knowingly, voluntarily, and intelligently waives any Double

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Jeopardy challenge, or any other challenge to the above-described
forfeiture based on the Excessive Fines Clause of the Kighth
Amendment to the United States Constitution.

Defendant also agrees that Defendant shall assist the United
States in all proceedings, whether administrative or judicial, involving
the forfeiture, disgorgement, transfer, or surrender of all rights, title,
and interest, regardless of their nature of form, in the property that
Defendant has agreed to forfeit, disgorge, transfer, or surrender, and
any other assets, including real and personal property, cash, and other
monetary instruments, wherever located, which Defendant or others to
his knowledge have accumulated as a result of illegal activities.

Such assistance will include agreement by Defendant’s heirs,
successors, and assigns, to forfeiture, disgorgement, transfer, or
surrender, to any interest in the above-described forfeiture. Such
assistance will further involve an agreement by Defendant to the entry
of an order enjoining the transfer or encumbrance of assets that may be
identified as alae subject to forfeiture, disgorgement, transfer, or

surrender.

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Defendant also agrees to identify all assets over which he
exercises control, directly or indirectly, or has exercised such control,
within the past five years. He will identify all assets in which he has or
had during that time any financial interest will provide all necessary
and appropriate documentation with respect to said assets, including
consents to forfeiture, quit claim deeds, and any and all other
documents necessary to deliver good and marketable title to said
property. Defendant agrees to take all steps as requested by the
government to obtain from any other parties by any lawful means any
records of assets owner at any time by Defendant. He also agrees to
undergo any polygraph examination the government may choose to
administer concerning such assets and to provide and/or consent to the
release of his tax returns for the previous five years.

Non-Abatement of Criminal Forfeiture: Defendant agrees the

forfeiture provisions of this Plea Agreement are intended to, and will,
survive him, notwithstanding the abatement of any underlying criminal
conviction after the execution of this agreement. The forfeitability of
any particular property pursuant to this agreement shall be determined

as if Defendant had survived, and that determination shall be binding

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upon Defendant’s heirs, successors, and assigns, until the agreed
forfeiture, including any agreed money judgment amount, is collected in
full.

G. Special Assessment

The defendant understands that he will be required to pay a

special assessment of $200, due immediately upon sentencing.

10. Appeal Waiver

The defendant waives any right he may have to appeal his
conviction on any grounds. If the defendant’s sentence of imprisonment
does not exceed the top of the guidelines range as determined by the
court, the defendant also waives any right he may have to appeal his
sentence on any grounds.

11. Collateral Review Waiver

The defendant retains the right to raise claims alleging ineffective
assistance of counsel, as long as the defendant properly raises those
claims by collateral review under 28 U.S.C. § 2255. The defendant also
retains the right to pursue any relief permitted under 18 U.S.C.

§ 3582(c), as long as the defendant properly files a motion under that

section. The defendant, however, waives any other right he may have to

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challenge his conviction or sentence by collateral review, including, but
not limited to, any right he[she] may have to challenge his conviction or
sentence on any grounds under 28 U.S.C. § 2255, 28 U.S.C. § 2241, or
Federal Rule of Civil Procedure 59 or 60.

12. Consequences of Withdrawal of Guilty Plea or Vacation of
Judgment

If the defendant is allowed to withdraw his guilty pleas, or if the
defendant’s conviction or sentence under this agreement is vacated, the
government may reinstate any charges against the defendant that were
dismissed as part of this agreement and may file additional charges
against the defendant relating, directly or indirectly, to any of the
conduct underlying the defendant’s guilty plea or any relevant conduct.
If the government reinstates any charges or files any additional charges
as permitted by this paragraph, the defendant waives his right to
challenge those charges on the ground that they were not filed in a
timely manner, including any claim that they were filed after the
limitations period expired.

13. Use of Withdrawn Guilty Plea

The defendant agrees that if he is permitted to withdraw his

guilty plea for any reason, he waives all of his rights under Federal

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Rule of Evidence 410, and the government may use his guilty plea, any
statement that the defendant made at his guilty plea hearing, and the
factual basis set forth in this agreement, against the defendant in any
proceeding.

14. Parties to Plea Agreement

This agreement does not bind any government agency except the
United States Attorney’s Office for the Eastern District of Michigan.

15. Scope of Plea Agreement

This plea agreement is the complete agreement between the
parties and supersedes any other promises, representations,
understandings, or agreements between the parties concerning the
subject matter of this agreement that were made at any time before the
guilty plea is entered in court. Thus, no oral or written promises made
by the government to the defendant or to the attorney for the defendant
at any time before the defendant pleads guilty are binding except to the
extent they have been explicitly incorporated into this plea agreement.
This plea agreement also does not prevent any civil or administrative
actions against the defendant, or any forfeiture claim against any

property, by the United States or any other party.

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16. Acceptance of Agreement by Defendant

This plea offer expires unless it has been received, fully signed, in
the United States Attorney’s Office by 5:00 PM on August 14, 2020. The
government may withdraw from this agreement at any time before the
defendant pleads guilty.

Matthew Schneider
United States Attorney

LAL fA

John K. Neal
Assistant United States Attorney
Chief, White Collar Crime Unit

Dated: 7/31/2020

By signing below, the defendant and his attorney agree that the
defendant has read or been read this entire document, has discussed it
with his attorney, and has had a full and complete opportunity to confer
with his attorney. The defendant further agrees that he understands

this entire document, agrees to its terms, has had all of his questions

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answered by his attorney, and is satisfied with his attorney’s advice and

B.

representation,
y,
Benton Martin Darrell Baker
Attorney for Defendant Defendant

Dated: Vio/zo ZO

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