The Northern District of West Virginia joins DOJ Fraud Division, SBA, and SBA OIG in Surge Takedown Exceeding $245 Million in COVID-era Loan Fraud; Two Morgantown Business Owners Part of National Fraud Takedown

Press release — The Northern District of West Virginia joins DOJ Fraud Division, SBA, and SBA OIG in Surge Takedown Exceeding $245 Million in COVID-era Loan Fraud; Two Morgantown Business Owners Part of National Fraud Takedown, dated 2026-09-15, issued by U.S. Attorney’s Office, Northern District of West Virginia.

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{"metadata":{"responseInfo":{"status":200},"resultset":{"count":"1","pagesize":20,"page":0},"executionTime":0.0063669681549072266},"results":[{"attachment":"","body":"Joint national takedown: 40 U.S. Attorney\u2019s Offices, along with 20 federal and state investigative agencies, participate in two-month enforcement surgeMORGANTOWN, WEST VIRGIINA \u2013 The Northern District of West Virginia, today, announced the sentencing and plea agreement as part of a nationwide enforcement action led by the Justice Department\u2019s National Fraud Enforcement Division, the Small Business Administration, and the SBA Office of Inspector General targeting fraud in the SBA\u2019s Paycheck Protection Program (PPP). The Northern District of West Virginia was a key participant in this surge effort.From June 12 to September 1, federal prosecutors across the country facilitated fraud enforcement actions spanning over 160 criminal defendants, including approximately 80 newly charged defendants, reaching approximately $245 million dollars in intended loss to American taxpayers.\u0026nbsp;\u0026nbsp;\u201cThese defendants deliberately stole from programs funded by American taxpayers and intended to support legitimate small businesses,\u201d\u0026nbsp;said United States Attorney Matthew Harvey. \u201cOur office will aggressively pursue those who misuse federal funds and will hold accountable anyone who attempts to defraud the United States.\u201d\u0026nbsp;\u201cPandemic loan relief was meant to keep American small businesses alive during government lockdowns\u2014not line the pockets of fraudsters,\u201d said Attorney General Todd Blanche. \u201cThe defendants charged during our summer surge allegedly fabricated businesses, submitted false payroll and revenue claims, stole identities, and concealed foreign ties on their applications\u2014 but they will now be prosecuted to the fullest extent of the law.\u201d\u0026nbsp;\u201cThis summer surge shows what is possible when dedicated public servants across the country work together with a single purpose,\u201d said Assistant Attorney General Colin M. McDonald of the National Fraud Enforcement Division. \u201cOur mission is clear: protect taxpayer funds, safeguard the integrity of federal relief programs, and deliver justice to those who exploited them. We will remain steadfast every day\u2014standing shoulder-to-shoulder with our partners\u2014to identify fraud, pursue those responsible, and restore confidence in the programs meant to help American small businesses thrive.\u201d\u0026nbsp;\u0026nbsp;\u201cToday\u2019s announcement represents the largest-ever action against perpetrators of SBA fraud, with 870,000 suspended borrowers tied to $39 billion in suspected fraudulent PPP and COVID EIDL activity. In partnership with Vice President Vance and the White House Task Force to Eliminate Fraud, we\u2019re putting fraudsters on notice: the federal government will no longer turn a blind eye to those who stole from taxpayers and exploited programs designed to sustain small businesses during the pandemic,\u201d said SBA Administrator Kelly Loeffler. \u201cWith demand letters going out to suspected fraudsters, we\u2019re also sending a clear message that they must repay their debts or face Treasury collections and possible federal law enforcement. Under this Administration, the free ride is over. We are restoring accountability, recovering taxpayer dollars, and protecting SBA programs for the legitimate small businesses they were created to serve.\u201d\u0026nbsp;\u201cOperation No Doze brings a focused and coordinated approach to pursuing fraud in SBA\u2019s pandemic relief programs,\u201d said SBA Inspector General William Kirk. \u201cBy concentrating our investigative resources and working closely with SBA and our law enforcement partners, we are strengthening our ability to identify fraud, recover taxpayer funds, and hold accountable those who exploited programs created to help small businesses in a time of extraordinary need. This initiative makes clear that the passage of time does not diminish our commitment to accountability.\u201dJames Baldwin, II, owner of Select Decks, a business in Morgantown, West Virginia, was sentenced to 30 days in federal prison and ordered to pay $1,007,223 in restitution. Baldwin, 46, applied for and received several Paycheck Protection Program (PPP) loans during the COVID-19 pandemic, both for his deck building business, Select Decks, and for three other businesses that were not in operation before the pandemic.\u0026nbsp; Baldwin falsified documents for the loan application to obtain $738,230 in PPP loans from multiple banks and then obtained forgiveness for the loans from the Small Business Administration (SBA).\u0026nbsp;Baldwin also failed to pay $258,993 in payroll taxes to the Internal Revenue Service. Beginning in tax year 2016, Baldwin issued pay stubs and W\u20112 forms to his employees reflecting that employment taxes had been withheld. However, investigators determined that Baldwin failed to file required IRS Forms 941 or W\u20113 for Select Decks and did not remit any of the withheld taxes to the Internal Revenue Service.\u0026nbsp;In a separate case, Kurt Ly, owner and operator of Vin Phat, Inc., in Morgantown, West Virginia, has admitted to a scheme to defraud federal pandemic relief programs designed to support small businesses during the COVID\u201119 crisis. According to investigators, Ly, 69, of Morgantown, obtained Paycheck Protection Program (PPP) loans, used the funds for impermissible expenses, and then obtained forgiveness from the SBA by falsely certifying to the SBA that the money was used for permissible business expenses.\u0026nbsp;In addition to the PPP loans, Ly received an Economic Injury Disaster Loan (EIDL) loan of $146,600 in August 2020 after certifying that the funds would be used solely as working capital for Vin Phat. Instead, investigators found that Ly used the money for large personal expenditures, including a $15,000 payment for a vehicle, multiple cryptocurrency investments, and transfers to his personal bank account.\u0026nbsp;The PPP program was created under the CARES Act to help small businesses maintain payroll and cover essential expenses during the public health emergency. Applicants were required to provide accurate payroll documentation, verify their identities, and certify that loan proceeds would be used only for permissible business purposes. In addition, borrowers seeking loan forgiveness were required to certify\u2014under penalty of perjury\u2014that PPP funds were spent on allowable expenses such as payroll, rent, mortgage interest, or utilities.The Baldwin case was investigated by Homeland Security Investigations and the Internal Revenue Service \u2013 Criminal Investigations and prosecuted by Assistant United States Attorney Jennifer T. Conklin. The Ly case was investigated by the Federal Reserve Bureau - Office of Inspective General and is being prosecuted by Assistant United States Attorneys Jennifer T. Conklin and Eleanor F. Hurney.On April 7, the Department of Justice announced the creation of the National Fraud Enforcement Division (\u201cFraud Division\u201d). The Fraud Division is laser-focused on investigating and prosecuting those who commit fraud against the American people. The Department\u2019s work to combat fraud supports President Trump\u2019s 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.","changed":"\u003Ctime datetime=\u00222026-09-15T09:02:07-04:00\u0022\u003E1789477327\u003C\/time\u003E\n","component":[{"uuid":"b2a654da-3abd-4317-aec0-c05c193094cf","name":"USAO - West Virginia, Northern"}],"created":"\u003Ctime datetime=\u00222026-09-15T08:58:51-04:00\u0022\u003E1789477131\u003C\/time\u003E\n","date":"1789473600","image":"","number":"","teaser":"\u003Cp\u003EMORGANTOWN, WEST VIRGIINA \u2013 The Northern District of West Virginia, today, announced the sentencing and plea agreement as part of a nationwide enforcement action led by the Justice Department\u2019s National Fraud Enforcement Division, the Small Business Administration, and the SBA Office of Inspector General targeting fraud in the SBA\u2019s Paycheck Protection Program (PPP). The Northern District of West Virginia was a key participant in this surge effort.\u003C\/p\u003E","title":"The Northern District of West Virginia joins DOJ Fraud Division, SBA, and SBA OIG in Surge Takedown Exceeding $245 Million in COVID-era Loan Fraud; Two Morgantown Business Owners Part of National Fraud Takedown","topic":[{"uuid":"32b4d47b-2142-420c-9aae-28f7bf2c86d4","name":"Fraud"}],"url":"https:\/\/www.justice.gov\/usao-ndwv\/pr\/northern-district-west-virginia-joins-doj-fraud-division-sba-and-sba-oig-surge","uuid":"2ee96877-b976-4cf6-b64e-926123f7d0b8"}]}

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