Criminal Information — U.S. v. Campbell Sales Group (E.D.N.C.)
Summary
A criminal information filed as Attachment A in United States v. Campbell Sales Group, Inc., Case 7:25-cr-00014-FL, in the U.S. District Court for the Eastern District of North Carolina, Southern Division, filed February 25, 2025 as Document 1-1. Counts One and Two charge the company, a leather furniture supplier headquartered in Leland, North Carolina, with wire fraud under Title 18, United States Code, Section 1343. The information alleges that after receiving a $257,700 PPP loan from First Home Bank on or about April 27, 2020, the company added fake employees and manipulated wages to obtain full forgiveness, then used the same false wage information to obtain a second PPP loan of $213,006 from First Community Bank. It seeks a forfeiture money judgment of at least $470,706.
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“Criminal Information — U.S. v. Campbell Sales Group (E.D.N.C.).”
Original at ecf.nced.uscourts.gov. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/court-filing-usa-v-campbell-sales-group-dkt-1-1-e-d-n-c-ba6dc7717b/
, SHA-256 da962a73b69d91e70b32d9925f8741d80634623b58ba487b41db7a0246a4f5c2.Full text
ATTACHMENT A
CRIMINAL INFORMATION
Case 7:25-cr-00014-FL Document 1-1 Filed 02/25/25 Page 1 of 8
UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF NORTH CAROLINA
SOUTHERN DIVISION
No. _ _ _ _ _ _ _ __
UNITED STATES OF AMERICA )
)
V. ) CRIMINAL INFORMATION
)
CAMPBELL SALES GROUP, INC. )
d/b/a LeatherltaliaUSA )
__________ )
The United States Attorney charges, at all relevant times, the following:
Introduction
1. CAMPBELL SALES GROUP d/b/a LeatherltaliaUSA ("CAMPBELL
SALES") was a leather furniture supplier headquartered in Leland, North Carolina,
within the Eastern District of North Carolina.
2. The Small Business Administration ("SBA") was an executive branch
agency of the United States government that provided support to small businesses
and entrepreneurs, including loans through banks, credit unions, and other lenders.
3. The Coronavirus Aid, Relief, and Economic Security Act ("CARES Act")
was a federal law enacted on March 27, 2020, designed to provide emergency
financial assistance to the millions of Americans who were suffering the economic
effects caused by the COVID-19 pandemic, which was declared a nationwide
disaster by the President on March 13, 2020. One source of relief provided by the
CARES Act was the authorization of forgivable loans to small businesses for job
Case 7:25-cr-00014-FL Document 1-1 Filed 02/25/25 Page 2 of 8
retention and certain other expenses through a new SBA program referred to as the
Paycheck Protection Program ("PPP").
4. In order to obtain a PPP loan, a qualifying business was required to
submit a PPP application. The PPP application required the business (through
its authorized representative) to acknowledge the program rules and make
certain affirmative certifications in order to be eligible to obtain the PPP. In the
PPP application, the applicant (through its authorized representative) was
required to state, among other things: (a) its average monthly payroll expenses;
and (b) its number of employees. These figures were used to calculate the
amount of money the small business was eligible to receive under the PPP
program.
5. The applicant was required to certify that they were in operation as
of February 15, 2020. The applicant was also required to certify that "[c]urrent
economic uncertainty makes this loan request necessary to support the ongoing
operations of the Applicant," and that "[t]he funds will be used to retain workers
and maintain payroll 01· make mortgage interest payment, lease payments, and
utility payments; I understand that if the funds are used for unauthorized
purposes, the federal government may pursue criminal fraud charges." The
applicant was also required to certify that the information in the application was
true and correct.
6. A business's PPP application was received and processed, in the first
instance, by a participating lender. If a PPP application was approved, the
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Case 7:25-cr-00014-FL Document 1-1 Filed 02/25/25 Page 3 of 8
participating lender funded the loan using its own monies, which was guaranteed
by the SBA. Data from the application, including information about the
borrower, the total amount of the loan, the listed number of employees, and the
gross income amount, was transmitted by the lender to the SBA in the course of
processing the loan.
7. A PPP borrower could repay the loan or choose to seek forgiveness of
the loan from the SBA by making certain representations and certifications. In
order to obtain forgiveness of a PPP loan, the borrower was required to submit a
PPP Loan Forgiveness Application (SBA Form 3508). In the forgiveness
application, the borrower was required to certify the amount of the PPP loan
proceeds that the borrower used for payroll and other authorized business
expenses during the covered period after the loan was made. In order to obtain
forgiveness of the entire PPP loan, the borrower was required to spend, and
attest to spending, at least 60 percent of the loan proceeds on eligible payroll
costs during the covered period. The forgiveness application required the
borrower to certify, among other things, that all information provided in the
application and supporting documents and forms was true and correct. The
borrower was also required to confirm that they understood that providing a false
statement to obtain forgiveness of an SBA-guaranteed loan was a federal crime,
punishable by fine, imprisonment, or both.
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Case 7:25-cr-00014-FL Document 1-1 Filed 02/25/25 Page 4 of 8
COUNTS ONE AND TWO
8. Paragraphs 1 through 7 are realleged and incorporated herein as
though fully set forth in this charge.
9. Beginning no later than April 2020 and continuing through at least
March 2022, both dates being approximate and inclusive, in the Eastern District of
North Carolina and elsewhere, the defendant,
CAMPBELL SALES GROUP d/b/a LeatherltaliaUSA,
devised and intended 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.
Manner and Means
10. It was part of the scheme and artifice that CAMPBELL SALES, at all
times acting by and through its authorized representatives, electronically submitted
a PPP loan application to First Home Bank on or about April 3, 2020. In the
application, CAMPBELL SALES certified that the loan funds would be used to,
among other things, "retain workers and maintain payroll." CAMPBELL SALES
affirmed that it would be required to provide to the lender "documentation verifying
the number of full-time employees on payroll" and payroll costs. On or about April
27, 2020, PPP loan proceeds totaling $257,700 were disbursed to CAMPBELL
SALES.
11. It was further a part of the scheme and artifice to defraud that, in
order to qualify for complete forgiveness of the PPP loan based on the SBA's
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Case 7:25-cr-00014-FL Document 1-1 Filed 02/25/25 Page 5 of 8
eligibility criteria, CAMPBELL SALES added fake employees to the company's
payroll during the covered period to create the illusion of higher payroll costs than
what the company was actually incurring at the time. CAMPBELL SALES also
fraudulently manipulated the wages of actual employees for the same purpose.
12. It was further a part of the scheme and artifice to defraud that on or
about October 30, 2020, CAMPBELL SALES electronically submitted a PPP Loan
Forgiveness Application (SBA Form 3508) to First Home Bank in which it
reported its artificially inflated payroll costs during the covered period.
13. It was further part of the scheme and artifice to defraud that on or
about January 5, 2021, CAMPBELL SALES emailed false and fraudulent payroll
documentation to First Home Bank to support the company's loan forgiveness
application, including a spreadsheet listing the "ghost" employees and their
purported wage amounts. The full loan amount was subsequently forgiven by the
SBA in May 2021.
14. It was a further part of the scheme and artifice to defraud that on or
about March 19, 2021, CAMPBELL SALES applied to First Community Bank for
an additional PPP loan and, in so doing, presented the same false 2020 wage
information used to obtain forgiveness of the company's first PPP loan. On or about
March 22, 2021, PPP loan proceeds totaling $213,006 were disbursed to
CAMPBELL SALES. The full loan amount was subsequently forgiven by the SBA
in March 2022.
5
Case 7:25-cr-00014-FL Document 1-1 Filed 02/25/25 Page 6 of 8
Use of the Wires
15. On or about each of the dates set forth below, in the Eastern District of
North Carolina and elsewhere, the defendant, CAMPBELL SALES GROUP d/b/a
LeatheritaliaUSA, for the purpose of executing the scheme described above, and
attempting to do so, caused to be transmitted by means of wire communication in
interstate commerce, the writings, signals, signs, pictures, and sounds described
below for each count:
COUNT DATE WIRE
1 October 30, 2020 PPP Loan Forgiveness Application submitted
by the defendant within the Eastern District
of North Carolina to First Home Bank, located
outside of North Carolina
2 March 19, 2021 PPP Application (Second Draw) submitted by
the defendant within the Eastern District of
North Carolina to First Community Bank,
located outside of North Carolina
Each entry in the foregoing table constituting a separate violation of Title 18,
United States Code, Section 1343.
FORFEITURE NOTICE
Notice is hereby given that all right, title, and interest m the property
specified herein is subject to forfeiture.
Upon conviction of any violation of Title 18, United States Code, Section
1343, the defendant shall forfeit to the United States, pursuant to 18 U.S.C. §
982(a)(3), any property, real or personal, which represents or is traceable to the
gross receipts obtained, directly or indirectly, as a result of such violation.
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Case 7:25-cr-00014-FL Document 1-1 Filed 02/25/25 Page 7 of 8
Forfeiture Money Judgment
a) A sum of money representing the gross proceeds of the offenses charged
herein against the defendant in the amount of at least $470,706.
If any of the above-described forfeitable property, as a result of any act or
omission of the defendant, cannot be located upon the exercise of due diligence; has
been transferred or sold to, or deposited with, a third party; has been placed beyond
the jurisdiction of the court; has been substantially diminished in value; or has been
commingled with other property which cannot be subdivided without difficulty; it is
the intent of the United States, pursuant to Title 21, United States Code, Section
853(p), to seek forfeiture of any other property of the defendant up to the value of
the above forfeitable property.
DANIEL P. BUBAR
Acting United States Attorney
AD~
Assistant United States Attorney
Criminal Division
Date: ______,
2/ ~IJ-_JJ
__i_ ':2_ J_
I I
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Case 7:25-cr-00014-FL Document 1-1 Filed 02/25/25 Page 8 of 8
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