Baltimore County Woman Indicted in Federal $2.5 Million Paycheck Protection Program Funds Case — U.S. Small Business Administration
Summary
An SBA Office of Inspector General news release published on October 20, 2026 reposts a District of Maryland announcement that Kara DiPietro, 49, of Towson, was indicted on six counts of bank fraud over Paycheck Protection Program loans. The indictment alleges that between April 2020 and May 2021 DiPietro, president and CEO of companies including H.M.C., Inc., Holdings Management Company Inc. and Kinetic Capital LLC, submitted more than 20 fraudulent PPP applications that listed false Employer Identification Numbers and failed to disclose prior applications. The applications sought more than $7.5 million; eight were funded, and accounts under DiPietro's control received more than $2.5 million, some of it allegedly spent on renovations to DiPietro's personal residence. The release notes that an indictment is not a finding of guilt; each count carries a maximum of 30 years in prison.
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OIG news release Baltimore County Woman Indicted in Federal $2.5 Million Paycheck Protection Program Funds Case Published on October 20, 2026 by Office of Inspector General Click Here to Sign Up for SBA OIG Email Updates on Recent Investigative Cases, Audit Oversight Reports, and General News Click Here to View the Original U.S. Department of Justice (DOJ) Press Release Defendant also allegedly submitted 20-plus fraudulent applications seeking more than $7.5M A Maryland woman is facing indictment stemming from submitting fraudulent applications for millions of dollars in federal loans. Kara DiPietro, 49, of Towson, is charged with bank fraud in connection with fraudulent applications that she allegedly filed to obtain Paycheck Protection Program (PPP) loans in the names of multiple businesses. Kelly O. Hayes, U.S. Attorney for the District of Maryland, announced the indictment with Special Agent in Charge Jimmy Paul, FBI Baltimore Field Office, and Inspector General William W. Kirk, U.S. Small Business Administration – Office of Inspector General, (SBA-OIG). This prosecution is part of the Trump Administration’s Task Force to Eliminate Fraud. The Coronavirus Aid, Relief, and Economic Security (CARES) Act — a federal law enacted in March 2020 — provided emergency financial assistance to Americans suffering from the economic effects of the COVID-19 pandemic. It authorized up to $659 billion in forgivable loans to small businesses for employee retention and certain business expenses through the Paycheck Protection Program (PPP), which was administered by the U.S. Small Business Administration (SBA). The business needed to use PPP loan proceeds on payroll costs, mortgage interest, rent, and utilities. According to the six-count indictment, between April 2020 and May 2021, DiPietro, who served as president and CEO of multiple Maryland companies — including H.M.C., Inc., Holdings Management Company Inc., and Kinetic Capital LLC — submitted more than 20 fraudulent PPP applications in the name of HMC, Holdings, Kinetic, and similarly named and/or spelled entities. These applications listed false and fraudulent Employer Identification Numbers (EINs) not assigned by the IRS to the entities listed on the applications. The applications also failed to disclose prior PPP loan applications associated with DiPietro; the applying entity; and/or other entities owned, controlled, created, and/or used by DiPietro as required under PPP rules. DiPietro further caused the submission of PPP applications that falsely certified that that the applicant business did not already receive a First Draw PPP loan and other PPP applications that falsely certified that the applicant business did not already receive a Second Draw PPP loan. The indictment alleges that, during 2020 and 2021, DiPietro caused the submission of PPP loan applications seeking more than $7.5 million. Eight of these applications were funded. Bank accounts under DiPietro’s control subsequently received more than $2.5 million in PPP funds. DiPietro then caused the transfer of PPP loan proceeds that were used for expenses that are not permissible under the PPP, including renovations to DiPietro’s personal residence. An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings. If convicted, DiPietro faces a maximum sentence of 30 years in federal prison for each of the six counts of bank fraud. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district judge determines sentencing after considering the U.S. Sentencing Guidelines and other statutory factors. On April 7, the Department of Justice announced the creation of the National Fraud Enforcement Division (“Fraud Division”). The Fraud Division is investigating and prosecuting those who commit fraud against the American people. The Department’s work to combat fraud supports President Trump’s Task Force to Eliminate Fraud, a whole-of-government effort chaired by Vice President J.D. Vance to eliminate fraud, waste, and abuse within Federal benefit programs. U.S. Attorney Hayes commended FBI and SBA-OIG for their work in the investigation. Ms. Hayes also thanked Assistant U.S. Attorneys Joseph Wenner and John Mark Mastakas who are prosecuting this federal case, along with Paralegal Specialist Joanna N. Huber, for her valuable assistance. For more information about the Maryland U.S. Attorney’s Office, its priorities, and resources available to report fraud, please visit justice.gov/usao-md and justice.gov/usao-md/report-fraud . Related programs: Pandemic Oversight, PPP
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