Criminal Information — United States v. Charmaine Redding

Record facts

U.S. District Court, Northern District of Georgia, Atlanta Division · No. 1:21-cr-00178-JPB · Doc. 1 · 2021-05-27 · Docket on CourtListener

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FILED IN OPEN COURT
U.S.D.C. Atlanta
MAY 'L 1 2021
V^sv<.i^»" tiy: /^<^^^De^Cterk
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTMCT OF GEORGIA
ATLANTA DIVISION
UNITED STATES OF AMERICA
Criminal Information
CHARMAINE REDDING I No- 1:21-CR-178
THE UNITED STATES ATTORNEY CHARGES THAT:
Background
At all times relevant to tins Information:
The Defendant and her Co-Conspirator
1. CHARMAINE REDDING (//REDDING//) was an individual residing in
the State of Michigan who claimed sole ownership of All Star Room and Board
Services of Michigan/ Inc./ a Michigan corporation.
2. DarreU Thomas was an individual residing in the State of Georgia
who claimed ownership/ and was the Chief Financial Officer, of BeUator Phront
Group Inc., a Georgia corporation. As of May 21,2020, Thomas claimed to be the
Chief Executive Officer, Secretary/ and registered agent of Elite Executive
Services Inc./ a Georgia corporation.
The Small Business Administration
3. The United States Small Business Administration (//SBA//) was an
executive branch agency of the United States government that provided support
to entrepreneurs and small businesses. The mission of the SBA was to maintain
and strengthen the nation's economy by enabling the establishment and viability
Case 1:21-cr-00178-JPB     Document 1     Filed 05/27/21     Page 1 of 7

of small businesses and by assisting in the economic recovery of communities
after disasters.
4. As part of this effort/ the SBA enabled and provided for loans
through banks, credit unions/ and other lenders. These loans had govermnent-
backed guarantees.
The Pay check Protection Program
5. The Coronavirus Aid/ Relief/ and Economic Security ("CARES") Act
was a federal law enacted in or about March 2020 and was designed to provide
emergency financial assistance to the millions of Americans who are suffering
the economic effects caused by the COVID-19 pandemic.
6. One source of relief that the CARES Act provided for was the
authorization of up to $349 billion in forgivable loans to smaU businesses for
payroll, mortgage interest, rent/lease/ and utilities, through a program referred
to as the Paycheck Protection Program (//PPP//). Congress subsequently
authorized additional PPP funding.
7. The PPP allowed qualifying small businesses and other
organizations to receive PPP loans. Businesses were required to use PPP loan
proceeds for payroll costs/ interest on mortgages/ rent/ and utilities. The PPP
allowed the interest and principal on the PPP loan to be entirely forgiven if the
business spent the loan proceeds on these expense items within a designated
period of time and used a certain percentage of the PPP loan proceeds for payroll
expenses.
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8. The amount of a PPP loan that a small business may have been
entitled to receive was determined by the number of employees employed by the
business and the business/s average monthly payroll costs.
9. In order to obtain a PPP loan/ a qualifying business was required 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 adEfirmative certifications in order to be eligible to obtain the PPP
loan. In the PPP loan application/ the small business (through its authorized
representative) had to state/ among other thmgs/ its (a) average monthly payroll
expenses and (b) number of employees. These figures were used to calculate the
amount of money the small business was eligible to receive under the PPP. In
addition/ businesses applying for a PPP loan had to provide documentation
showing their payroU expenses.
10. The SBA oversaw the PPP. However/ individual PPP loans were
issued by private/ approved lenders who received and processed PPP
applications and supporting documentation/ and then made loans using the
lenders' own funds/ which were 100% guaranteed by the SBA. Data from the
application/ including information about the borrower/ the total amount of the
loan/ and the listed number of employees, was transmitted by the lender to title
SBA in the course of processing the loan.
11. Financial Institution 1 was a non-bank financial institution
headquartered in Laguna Hills, California. Financial Institution 1 participated in
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the SBA/s PPP as a lender/ and as such/ was authorized to lend funds to eligible
borrowers under the terms of the PPP.
Count One
Conspiracy to Commit Wire Fraud
12. The United States Attorney re-alleges and incorporates by reference
the factual allegations contained in paragraphs 1 through 11 of this Information
as if fuUy set forth herein.
13. From in or about April 2020 through in or about June 2020, the exact
dates unknown/ in the Northern District of Georgia and elsewhere/ the
defendant/
CHARMAINE REDDING/
did knowingly and willfully combine, conspire/ confederate/ agree/ and have a
tacit understanding with Darrell Thomas and with others known and unknown,
to devise and intend to devise a scheme and artifice to defraud/ and to obtain
money and property/ by means of materially false and fraudulent pretenses,
representations, and promises/ and by the omission of material facts/ well
knowing and having reason to know that said pretenses were and would be false
and fraudulent when made and caused to be made and that said omissions were
and would be material/ and/ in so doing, with intent to defraud/ caused interstate
and foreign wire communications to be made/ in furtherance of the scheme and
artifice to defraud/ in violation of Title 18, United States Code, Section 1343.
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Manner and Means
14. On or about June II/ 2020, REDDING and her co-conspirators utilized
interstate wires to submit and assist in the submission of/ a PPP loan application
for All Star Room and Board Services of Michigan, Inc. to Financial Institution 1.
REDDING signed/ or authorized another individual to sign/ All Star Room and
Board Services of Michigan/ Inc. s PPP loan application.
15. On the PPP loan application for All Star Room and Board Services of
Michigan/ Inc./ REDDING and her co-conspirators falsely and fraudulently
represented that the company had 59 employees and an average monthly payroll
of $295,186.25.
16. The PPP loan application contained REDDING'S initials to certify each
of the following representations:
a. The Applicant business was in operation on February 15, 2020
and had employees for whom it paid salaries and payroll
taxes or paid independent contractors/ as reported on Form(s)
1099-MISC;
b. The funds will be used to retain workers and maintain payroU
or make mortgage interest payments/ lease payments/ and
utility payments, as specified under the Paycheck Protection
Program Rule; and
c. The information provided in the application and the
information provided in all supporting documents and forms
is true and accurate in all material respects.
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17. REDDDSTG assisted in the submission of falsified IBS Form 941s for
each quarter of 2019 included with All Star Room and Board Services of
Michigan/ Inc/s PPP loan application and falsified W-2 payroll spreadsheets for
January 1 through December 31, 2019 and for January 1 through May 31,2020.
18. Based on the false and fraudulent representations and submissions
made by REDDING and her co-conspirators/ Financial Institution 1 distributed
approximately $737/965 to AU Star Room and Board Services of Michigan/ Inc.
All in violation of Title 18, United States Code/ Section 1349.
Forfeiture Provision
Upon conviction of the offense alleged in this Information/ the defendant,
CHARMAINE REDDING, shall forfeit to the United States, pursuant to Title 18,
United States Code/ Section 982(a)(2)/ any property/ real or personal/ constituting
or derived from proceeds obtained/ directly or indirectly/ as a result of the
violation/ including/ but not limited to/ the following:
i. Money Judgment: A sum of money in United States currency representing
the amount of proceeds obtained as a result of each offense, or conspiracy to
commit such offense, for which each defendant is convicted.
If/ as a result of any act or omission of the defendant(s)/ any property subject
to forfeiture/
(a) cannot be located upon the exercise of due diligence;
(b) has been transferred or sold to/ or deposited with/ a third party;
(c) has been placed beyond the jurisdiction of the court;
(d) has been substantially diminished in value; or
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(e) has been commingled with other property which cannot be divided
without difficulty/
the United States intends/ pursuant to Title 21, United States Code/ Section
853(p)/ as incorporated by Title 18, United States Code/ Section 982(b)/ to seek
forfeiture of any other property of the defendant up to the value of the forfeitable
property described above.
KURT R. ERSKINE DANIEL S. KAHN
Acting United States Attorney Acting Chief, fraud Section
LT.S. Department of Justice
Ta^C^^ 5^%^&
TALC.CHAIKEN Slfl MOORE
Assistant United States Attorney Trial Attorney, Fraud Section
Georgia Bar No. 273949 U.S. Department of Justice
NATHAN p. KITCHENS
Assistant United States Attorney
Georgia Bar No. 263930
600 U.S. Courthouse 1400 New York Ave/NW
75 Ted Turner Drive SW Bond Building/ llth Floor
Atlanta, GA 30303 Washington/ DC 20005
404-581-6000; Fax: 404-581-6181 202-514-2000; Fax: 202-514-3708
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