Richmond Man Pleads Guilty to $1 Million Paycheck Protection Program Fraud Scheme

Summary

A U.S. Attorney’s Office press release for the Eastern District of Virginia, published May 27, 2022, headed Richmond Man Pleads Guilty to $1 Million Paycheck Protection Program Fraud Scheme. It states that Moe Ayemen Mathews pleaded guilty to defrauding the Paycheck Protection Program (PPP) of over $1 million. From April 2020 to April 2021, Mathews, with the assistance of a co-conspirator, submitted at least 38 fraudulent PPP loan applications, including first draw and second draw applications, according to court documents. The release states that sentencing is scheduled for October 7, with a maximum penalty of 30 years in prison, and gives the case number as 3:22-cr-44.

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RICHMOND, Va. – A Richmond man pleaded guilty today to defrauding the Paycheck Protection Program (PPP) of over $1 million in funds intended for small businesses affected by the COVID-19 Pandemic.
According to court documents, from April 2020 to April 2021, Moe Ayemen Mathews, 51, with the assistance of his co-conspirator, submitted at least 38 fraudulent PPP loan applications to financial institutions for businesses the conspirators claimed to own and operate. In their first draw PPP applications, the conspirators falsely certified that the information and supporting documentation provided was true and accurate when, in fact, the applications contained false statements, false certifications, and fabricated tax documents. For instance, the conspirators repeatedly inflated or fabricated the average monthly payroll and number of employees working for their purported businesses, and they submitted fabricated tax documents to substantiate the false information provided in their PPP applications. Once their fraudulent applications were approved, the conspirators did not use the funds in accordance with the program’s requirements.
Additionally, after their first draw PPP applications were approved and funded, the conspirators submitted fraudulent second draw PPP applications predicated on their fraudulently-obtained first draw PPP loans. When submitting the second draw PPP applications for their purported businesses, the conspirators concealed the fact that they had intentionally and knowingly submitted false and misleading first draw PPP applications. Once these second-draw applications were approved, the conspirators used the loan proceeds contrary to the program’s requirements.
Mathews is scheduled to be sentenced on October 7. He faces a maximum penalty of 30 years in prison. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia; Stanley M. Meador, Special Agent in Charge of the FBI’s Richmond Field Office; Hannibal “Mike” Ware, Inspector General of the Small Business Administration (SBA); and Jay N. Lerner, Inspector General of the Federal Deposit Insurance Corporation (FDIC), made the announcement after Senior U.S. Districy Judge Henry E. Hudson accepted the plea.
The U.S. Attorney’s Office for the Eastern District of Virginia expresses its appreciation to the Virginia State Corporation Commission for their assistance with this investigation.
Assistant U.S. Attorney Kashan Pathan is prosecuting the case.
A copy of this press release is located on the website of the
U.S. Attorney’s Office
for the Eastern District of Virginia. Related court documents and information are located on the website of the
District Court
for the Eastern District of Virginia or on
PACER
by searching for Case No. 3:22-cr-44.

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