Criminal Information — United States v. George Mensah, Jr. (E.D. Va., Document 4, November 1, 2023)

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A Criminal Information in United States of America v. George Mensah, Jr., Case No. 1:23-cr-168, in the U.S. District Court for the Eastern District of Virginia, Alexandria Division, filed November 1, 2023 as Document 4. Count 1 charges conspiracy to commit wire fraud and mail fraud under 18 U.S.C. § 1349. It alleges that from about October 2020 to about September 2021 Mensah and coconspirators prepared fraudulent PPP loan applications for businesses that did not exist, charging fees often between $4,000 to $6,000, with most applications paying out exactly $20,832. It also alleges that the conspirators obtained at least $658,952 in fraudulent unemployment and pandemic benefits. The forfeiture notice seeks a money judgment of $264,309, $82,000.00 in seized currency and a Cuban bracelet.

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Case 1:23-cr-00168-RDA Document4_ Filed 11/01/23 Page 1 of 13 PagelD# 7

EASTERN DISTRICT OF VIRGINIA

Alexandria Division

UNITED STATES OF AMERICA Case No. 1:23-cr-168
v. Count 1: 18 U.S.C. § 1349
(Conspiracy to Commit Wire Fraud and Mail

GEORGE MENSAH, JR.., Fraud)

Also known as “Flexheem,”

Also known as “Flexxheem,”’ Forfeiture Notice

Also known as “Flex,”

Defendant.

CRIMINAL INFORMATION

THE UNITED STATES CHARGES THAT:

INTRODUCTORY ALLEGATIONS

At all times relevant to the information, unless otherwise stated:

ie From at least October 2020 through at least June 2021, defendant George Mensah,
Jr. “MENSAH?” or “defendant’) resided in different places within Fairfax County, Virginia, which
was within the Eastern District of Virginia. The defendant also used a property on Meteor Place in
Springfield, Virginia (hereinafter, the “Meteor Place address”) during this time.

2. During this same time, the defendant’s parents lived in Alexandria, Virginia on
Beechcliff Drive (hereinafter, the “Beechcliff address.”) The defendant also spent time at the
Beechcliff address.

3. The defendant went by other names including, “Flexheem,” “Flexxheem,” and

“Flex.”
Case 1:23-cr-00168-RDA Document4 _ Filed 11/01/23. Page 2 of 13 PagelD# 8

4, Financial Institution-1 was a Community Development Financial Institution that
was headquartered in Arizona. Financial Institution-1 was insured by the FDIC and was a financial
institution as defined by 18 U.S.C. § 20.

The CARES Act and PPP

5. The 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 of small
businesses and by assisting in the economic recovery of communities after disasters.

6. As part of this effort, the SBA enabled and provided for loans through banks, credit
unions, and other lenders. Financial Institution-1 participated in the PPP as a lender, and, as such,
was authorized to lend funds to eligible borrowers under the terms of the PPP. These loans had
government backed guarantees. The Coronavirus Aid, Relief, and Economic Security (“CARES”)
Act was a federal law enacted in or around March 2020 and designed to provide emergency
financial assistance to the millions of Americans who were suffering the economic effects caused
by the COVID-19 pandemic.

7. One source of relief provided by the CARES Act was the authorization of up to
$349 billion in forgivable loans to small businesses for job retention and certain other expenses,
through a program referred to as the Paycheck Protection Program (“PPP”). In or about April 2020,
Congress authorized over $300 billion in additional PPP funding.

8. The PPP allowed qualifying small businesses and other organizations to receive
PPP loans. As part of the program requirements, businesses had to use PPP loan proceeds for
certain permissible expenses — payroll costs, interest on mortgages, rent, and utilities. The PPP

allowed the interest and principal on the PPP loans to be entirely forgiven if the business spent the
Case 1:23-cr-00168-RDA Document4 Filed 11/01/23. Page 3 of 13 PagelD# 9

loan proceeds on these expense items within a designated period of time and used a certain
percentage of the PPP loan proceeds on payroll expenses.

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 affirmative certifications. In the PPP loan application, the small
business (through its authorized representative) had to state, among other things, its: (a) average
monthly payroll expenses; and (b) number of employees. These figures were used by the lender 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 payroll
expenses. The supporting documentation often included bank account records and IRS Forms,
including the IRS Schedule C (Form 1040), Profit or Loss Form Business, which reports a sole
proprietorship’s income and expenses. The lenders relied on the accuracy of the information
contained in the PPP applications and supporting documents.

10. | The SBA oversaw the PPP. However, individual PPP loans were issued by private,
approved lenders who received and processed PPP applications and the 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, or by a partner on the lender’s
behalf, via wire to the SBA in the course of processing the loan. The SBA received all PPP loan
applications submitted after January 11,2021, from lenders through servers in Oregon. This server
performed an initial screening on the loan applications and then sent the loan details to E-Tran for

additional screening of the loan applications. The SBA then used the E-Tran server located in
Case 1:23-cr-00168-RDA Document4 Filed 11/01/23 Page 4 of 13 PagelD# 10

Sterling, Virginia, within the Eastern District of Virginia, to process the applicant’s data
electronically to determine if. loan should be authorized. Similarly, after its review, the SBA used
the E-Tran computer server located in Sterling, Virginia to notify the lenders, or a partner on the
lender’s behalf, electronically if a loan should be funded.

11. The PPP loan application posed a number of questions and required the applicant
to make a number of certifications including that the business was in operation as of February 15,
2020, that the PPP loan would be used to pay payroll, mortgage payments, lease payments, and
utility payments as required by the PPP rules, and that all information in the application supporting
document was true and accurate.

The Unemployment Insurance Process and Pandemic Unemployment Benefits

12. | Unemployment Insurance (“UI”) was a state-federal program that provided
monetary benefits to eligible lawful workers. Although state workforce agencies (“SWAs”)
administer their respective UI programs, they must do so in accordance with federal laws and
regulations. UI payments (“benefits”) were intended to provide temporary financial assistance to
lawful workers who were unemployed through no fault of their own. Each state set its own
requirements for eligibility, benefit amounts, and length of time benefits could be paid. In the
Commonwealth of Virginia, the Virginia Employment Commission (“VEC”) administered the UI]
program.

13. Generally, a former employee of an in-state business, or a person previously self-
employed in-state, had the option to submit a claim application for UI benefits. In Virginia,
typically, a claimant would submit an online application with the VEC listing the claimant’s
personally identifiable information (“PII”), such as name, Social Security number, date of birth,

address, and other information. The claimant was then required to answer a series of questions to
Case 1:23-cr-00168-RDA Document4 Filed 11/01/23 Page 5 of 13 PagelD# 11

determine eligibility and the payment amount. The claimant then attested that the information
provided in the claim application was true to the best of their knowledge.

14... After the initial claim, the claimant could then file for weekly benefits, also
typically online, by certifying that they are still unemployed and still eligible for benefits.

15. When applying for Virginia UI, claimants had the option of receiving a Virginia
Way2Go Prepaid MasterCard debit card (““Way2Go card’) containing their benefits and issued in
their names. Way2Go cards were mailed, via the United States Postal Service, to the physical
address listed on the application. Each card has a unique card number alongside the claimant’s
name.

16. | Beginning in or around March 2020, in response to the COVID-19 pandemic,
several federal ‘programs expanded UI eligibility and increased UI benefits, including the
Pandemic Unemployment Assistance Program (“PUA”), Pandemic Emergency Unemployment
Compensation (“PEUC”), Federal Pandemic Unemployment Compensation (“FPUC”), and the
Lost Wages Assistance Program (“LWAP”).

17. PUA provided benefits to individuals who were self-employed, seeking part-time
employment, or otherwise would not qualify for regular UI. A claimant would qualify for PUA
benefits administered by the SWA if they previously performed such work in the state and were
unemployed, partially unemployed, unable to work, or unavailable to work due to a COVID-19

_ related reason. A PUA claimant had to answer various questions to establish their eligibility for
PUA benefits. The claimant was required to provide their name, Social Security Number, and
address. The claimant also had to list their qualifying occupational status, their employer, and
COVID-19 related reason for being out of work and certify that all the information provided on

the application was correct.
Case 1:23-cr-00168-RDA Document4 Filed 11/01/23 Page 6 of 13 PagelD# 12

18. | PEUC provided benefits to individuals who had exhausted regular UI under state
or federal law, had no rights to regular UI under any other state or federal law, and were able to
work, were available for work, and were actively seeking work. |

19. | FPUC provided individuals who were collecting regular UI, PUA PEUC, and other
forms of UI with an additional $600 per week for a certain period of time.

20. | LWAP was another temporary measure that provided an additional $300 per week
for a particular period of time.

21. |The PUA, FPUC, PEUC, and LWAP programs (collectively, “pandemic benefits”)
were administered by the various states, including the Commonwealth of Virginia, but their
benefits were funded by the federal government. In order to receive pandemic benefits, an -
applicant was required to file a claim. Separate claims were not filed for PUA, FPUC, and LWAP.
Rather, a single claim for PUA, if approved, also resulted in an approved claim for the additional
FPUC and LWAP benefits.

22. Similar to the traditional UI program, applicants applied for pandemic benefits
through the VEC and could receive a Virginia Way2Go card via the mail. Applicants then made
additional weekly claims for benefits by answering certain questions, and certifying that all the
information given on the weekly certifications were correct.

23. After the processing of the weekly certifications, the pandemic benefits would then

be loaded to the Way2Go card previously sent or to a prior listed bank account.
Case 1:23-cr-00168-RDA Document4 _ Filed 11/01/23 Page 7 of 13 PagelD# 13

COUNT ONE
(Conspiracy to Commit Wire Fraud)

24. The allegations contained paragraphs 1-23 of this Information are realleged and
incorporated by reference as if set forth fully here.

25. From in or about October 2020 to in or about September 2021, in the Eastern
District of Virginia and elsewhere, defendant,

GEORGE MENSAH, JR.,

did knowingly combine, conspire, confederate, and agree with Coconspirator-1, Coconspirator-2,
and others known and unknown to the United States Attorney (collectively referred to as
“coconspirators”), did unlawfully, voluntarily, intentionally and knowingly combine, conspire
and agree together and with each other to commit the following offenses:

a. wire fraud in violation of 18 U.S.C. § 1343— that is, having knowingly
devised and intending to devise a scheme and artifice to defraud financial institutions and the SBA,
and to obtain money and property by means of materially false and fraudulent pretenses,
representations, and promises, to transmit and cause to be transmitted by means of wire
communication in interstate commerce writings, signs, signals, pictures, and sounds for the
purpose of executing such scheme and artifice; and

b. mail fraud in violation of 18 U.S.C. § 1341- that is, having knowingly
devised and intending to devise a scheme and artifice to defraud the VEC and other SWAs, and to
obtain money and property by means of materially false and fraudulent pretenses, representations,
and promises, and for the purpose of executing such a scheme or artifice, knowingly caused to be
delivered by U.S. mail and according to the direction thereon and at the place at which the
defendant and others directed, took and received from an authorized depository for mail matter

any matter.
Case 1:23-cr-00168-RDA Document4 Filed 11/01/23 Page 8 of 13 PagelD# 14

The Purpose of the Conspiracy

26. The purpose of the conspiracy was for MENSAH, Coconspirator-1, Coconspirator-
2, Coconspirator-3, and others known and unknown to enrich themselves by fraudulently obtaining
PPP loans for purported “businesses” that did not actually exist and were not entitled to receive
PPP loans. MENSAH and his coconspirators obtained and tried to obtain fees, often between
$4,000 to $6,000, from the individuals and purported “business owners” for whom they obtained
PPP loans for preparing the PPP loan applications. Additionally, MENSAH, Coconspirator-1,
Coconspirator-2, and the other coconspirators to enrich themselves by fraudulently obtaining UI
benefits and pandemic benefits to which they were not entitled.

Manner and Means

27. To achieve the objects of the conspiracy the defendant and his coconspirators
engaged in the following conduct in the Eastern District of Virginia and elsewhere:

The PPP Scheme

28. | The defendant and his coconspirators would recruit others to have PPP loan
applications prepared in their names. The defendant and his coconspirators would communicate
with individuals over social media and text messages about preparing the PPP loan applications.

29. | MENSAH and his coconspirators would prepare, cause to be prepared, and assist
in the preparation of the fraudulent PPP loan applications for the fake businesses.

30. | The defendant and his coconspirators would also prepare, cause to be prepared,
assist in the preparation of, submit, assist in the submission of, and cause to be submitted, falsified
IRS forms, including Schedule C forms that falsely represented that each fake business had
generated a certain amount of gross income (when in fact the fake businesses had not generated

that amount of income) and fake bank statements in support of each PPP application. The false
Case 1:23-cr-00168-RDA Document4 Filed 11/01/23. Page 9 of 13 PagelD# 15

PPP loan applications and underlying fabricated records created during the conspiracy were
similar. Most of the fraudulent PPP loan applications resulted in a payout of exactly $20,832.
Similarly, at least 20 of the false Forms Schedule C listed the loan applicants’ gross income as
$107,990.

31. | Knowing that these businesses did not exist as of February 15, 2020, MENSAH
and his coconspirators would falsely certify and cause to be certified that certain businesses were
in operation on February 15, 2020.

32. | Knowing that the PPP loan proceeds, including the $4,000 to $6,000 paid to the
defendant and his coconspirators, would be used for purposes unrelated to the specified authorized
expenses of the PPP loans, the defendant and his coconspirators would falsely certify and caused
to be certified on each PPP loan application that the funds would be used to retain workers and
maintain payroll or make mortgage interest payments, lease payments, and utility payments.

33. Knowing that the applications and the IRS forms included false information, the
defendant and his coconspirators falsely certified and caused to be certified on each PPP loan
application that the information provided in the application and the information provided in all
supporting documents and forms was true and accurate in all material respects.

34. | The coconspirators would electronically sign and submit, assist in the submission
of, and caused to be submitted, the false PPP loan applications over the Internet.

35. The defendant and his coconspirators submitted 19 fraudulent PPP loan
applications from the Meteor Place address between on or about Apri! 11, 2021, through on or
about May 20, 2021. Many of the fraudulent PPP loan applications were submitted on the same

day.
Case 1:23-cr-00168-RDA Document4 Filed 11/01/23. Page 10 of 13 PagelD# 16

36. | The defendant and his coconspirators’ submission of the fraudulent PPP loan
applications caused interstate wire transmissions. The defendant and his coconspirators submitted
multiple fraudulent loan applications from the Meteor Place address, in the Eastern District of
Virginia, that were received by the lenders and then sent to the SBA, which used servers located _
in Oregon before being transmitted to a server in the Eastern District of Virginia.

37. After the lenders approved and funded the fraudulent PPP loans, the defendant and
his coconspirators would collect fees from the individuals who received the PPP loans through
CashApp accounts and bank transfers. Often the individual who received the fraudulent PPP loan
would pay the defendant and his coconspirators a fee of between $4,000 and $6,000.

38. | MENSAH and his coconspirators knowingly prepared and submitted, assisted in
the preparation and submission of, and caused to be prepared and submitted, over 47 applications
for PPP loans for fake businesses during the conspiracy. In total, the defendant and his
coconspirators successfully submitted at least 21 fraudulent PPP applications and caused an actual
loss of at least $583,172.

The UI and Pandemic Benefits Scheme

39. | Among the ways, manner and means by which the defendant and the coconspirators
accomplished the objects of the conspiracy included the following:

40. The defendant and his coconspirators, including Coconspirator-1 and
Coconspirator-2, would obtain the PII of others such as dates of birth and Social Security numbers.
Some of the PII belonged to victims of identity theft.

41. | Coconspirator-1 would notify the other coconspirators as to which SWAs were

accepting pandemic benefit applications and/or certification at any given time.

10
Case 1:23-cr-00168-RDA Document4 Filed 11/01/23. Page 11 of 13 PagelD# 17

42. The defendant and his coconspirators would use various addresses to make claims
and receive through mail VEC PINs, Way2Go cards, other VEC correspondence.

43. The defendant and his coconspirators would complete and submit applications and
weekly certifications for UI and pandemic benefits to the VEC and other SWAs. The defendant
and his coconspirators would use others’ names and PII to make claims for UI benefits and
pandemic benefits.

44. The defendant and his coconspirators would include materially false information in
these applications. For some of the applications and certifications, despite using real PII, the listed -
claimants did not authorize or know the UI and pandemic benefit claims were being made.
Additionally, the defendant and his coconspirators provided false employment and wage history,
as well as false contact information, including addresses, email addresses, and phone numbers.
The defendant and his coconspirators listed the Beechcliff address on at least 26 of their fraudulent
applications, and the VEC funded 21 of those fraudulent applications.

45. | The defendant and his coconspirators would falsely certify the truth and accuracy
of all information included in the UI and pandemic benefit applications for the VECs and other
SWAs, as well as the purported claimants’ eligibility to receive those benefits, when -in truth and
fact, as the defendant and his coconspirators then and there well knew — such information was not
true and accurate and neither the defendant, his coconspirators, nor the individuals identified as
claimants were then eligible to receive the benefits sought through these applications.

46. The defendant and his coconspirators thereby caused the VEC and financial
institutions on behalf of the VEC to send the Way2Go cards through the U.S. mail to the addresses
that the defendant and his coconspirators identified in the corresponding applications for the UI

benefits and pandemic benefits. As a result of these false UI and pandemic benefit applications

11
Case 1:23-cr-00168-RDA Document4 _ Filed 11/01/23 ° Page 12 of 13 PagelD# 18

and claims submitted by the defendant and his coconspirators, at least 20 Way2Go cards were
mailed to the Beechcliff address.

47. The defendant, his coconspirators would collect the VEC PINs, Way2Go cards and
VEC correspondence from the various addresses listed on the UI and pandemic benefit claims.
The defendant and his coconspirators would also share details regarding the Way2Go cards
amongst themselves to facilitate the retrieval of these cards.

48. | Once the VEC authorized the initial applications for UI and pandemic benefits, in
order to continue to receive such benefits, the defendant and his coconspirators would continue to
file claims by submitting false weekly certifications that the purported claimant remained eligible
to receive those benefits. |

49. The defendant and his coconspirators would disburse the UI and pandemic benefit
funds deposited on the Way2Go cards and therefore held in the custody of a financial institution,
through various transactions, including purchases and ATM cash withdrawals, some of which
included large sums of cash.

50. Throughout the course of the conspiracy, the defendant and his coconspirators
obtained at least $658,952 in fraudulently obtained UI and pandemic benefits.

(All in violation of Title 18, United States Code, Section 1349.)

12
Case 1:23-cr-00168-RDA Document4 Filed 11/01/23 Page 13 of 13 PagelD# 19

FORFEITURE NOTICE

Pursuant to Federal Rule of Criminal Procedure 32.2(a), defendant GEORGE MENSAH,
JR. is hereby notified that upon conviction of the offense alleged in Count | of the Criminal
Information, MENSAH shall forfeit to the United States, pursuant to 18 U.S.C. § 982(a)(2), any
property, real or personal, constituting, or derived from, proceeds the defendant obtained directly
or indirectly, as the result of the violation.

The assets subject to forfeiture include, but are not limited to, the following:

a. A sum of money in the amount of $264,309 representing the proceeds the defendant

obtained as a result of the offense described in Count | of the Criminal Information:
b. $82,000.00 in U.S. currency seized by law enforcement on or about March 3, 2022;
c. a Cuban bracelet seized by law enforcement on or about March 3, 2022;

Pursuant to 21 U.S.C. § 853(p), MENSAH shall forfeit substitute property, if, by any act
or omission of MENSAH the property referenced above cannot be located upon the exercise of
due diligence; has been transferred, 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 divided without difficulty.

(In accordance with Title 18, United States Code, Section 982(a)(2)(A); Title 21 United
States Code, 853(p); and Rule 32.2(a), Federal Rules of Criminal Procedure.)

JESSICA D. ABER
UNITED STATES ATTORNEY

Kathleen E. Robeson —

Kimberly M. Shartar

Assistant United States Attorneys

Ezra Spiro

Special Assistant United States Attorney


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