Criminal Information — United States v. Monica Faye Barnes (Dkt. 5)

Summary

Criminal Information in United States v. Monica Faye Barnes, Eastern District of North Carolina, Western Division, filed 03/22/23 in Case 5:23-cr-00094-D. The United States Attorney charges that, from in or about March 2021 to in or about September 2021, Defendants Monica Faye Barnes and Dontrell Rayshar Barnes conspired with others to defraud the Paycheck Protection Program in the name of Minnie's Banana Cups and Catering Service, Inc. It alleges that the PPP application claimed seven employees and an annual payroll of approximately $700,000, figures designed to yield a loan of just under $150,000. The charge alleges a conspiracy to commit wire fraud in violation of Section 1349. The forfeiture notice seeks a money judgment of at least $94,791 against Monica Faye Barnes.

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“Criminal Information — United States v. Monica Faye Barnes (Dkt. 5).” Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/gov-uscourts-nced-200166-5-0-946b9d03c5/, SHA-256 cb2d532f006166728aa1b83ac89ad021e2ac5cf5a90b88153fa686f648c2674a.

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FILED
MAR 2 2 2023
DGB
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NORTH CAROLINA
WESTERN DIVISION

No.5·-23-C(2-9 4

UNITED STATES OF AMERICA )
)
V. ) CRIMINAL INFORMATION
)
DONTRELL RAYSHARE BARNES )
MONICA FAYE BARNES )

The United States Attorney charges the following:

INTRODUCTORY ALLEGATIONS

1. From in or about March 2021 to in or about September 2021, Defendants

MONICA FAYE BARNES, DONTRELL RAYSHAR BARNES, and others, known and

unknown to the United States Attorney, conspired to defraud the United States

Government in the name of a company they controlled. This scheme involved frauds

upon institutions and agencies engaged to provide financial assistance to the public

arising from the COVID-19 pandemic.

2. At all times relevant to this Information, both Defendants were

residents of the Eastern District of North Carolina.

COVID Fraud: The Paycheck Protection Program ("PPP")

3. In March 2020, Congress passed the Coronavirus Aid, Relief, and

Case 5:23-cr-00094-D Document 5 Filed 03/22/23 Page 1 of 11
Economic Security (CARES) Act, which was designed to provide emergency financial

assistance to millions of Americans who were suffering from the economic effects

caused by the COVID-19 pandemic.

4. The United States Small Business Administration (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

business and by assisting in the economic recovery of communities after disasters.

5. 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 around April 2020, Congress authorized over $300 billion in

additional PPP funding.

6. To obtain a PPP loan, businesses were required to submit a PPP loan

application, signed by an authorized representative of the business, acknowledging

the program rules. The business was required to state (a) its average monthly

payroll expenses and (b) the number of employees. These figures were used to

calculate the amount of money the small business was eligible to receive under the

PPP. In addition, businesses applying for a PPP loan were required to provide

documentation showing their payroll expenses.

7. A PPP loan application was required to be processed by a participating

Case 5:23-cr-00094-D Document 5 Filed 03/22/23 Page 2 of 11
financial institution ("Lender"). Many Lenders constituted financial institutions, as

that term is defined in Title 18, United States Code, Section 20. If a PPP loan

application was approved, the Lender funded the PPP loan using its own moneys,

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, were transmitted by the Lender to the SBA in the course of processing

the loan.

8. PPP loan proceeds were required to be used by businesses on certain

permissible expenses: payroll costs, interest on mortgages, rent, and utilities. Loans

provided through the PPP have government-backed guarantees and are 100%

forgivable if the borrower submits documentation to the PPP Lender and SBA

demonstrating that at least sixty percent (60%) of the PPP loan proceeds were utilized

to meet existing payroll obligations and to retain employees.

9. Funds disbursed under the PPP and other programs are referred to

collectively herein as "COVID Loans."

The Scheme to Defraud

10. From in or about March 2021, to in or about September 2021, the

Defendants, MONICA FAYE BARNES and DONTRELL RAYSHAR BARNES ("the

Defendants") conspired with each other, E.W., S.C., and others to engage in a fraud

upon the PPP program. The Defendants engaged in fraud upon the PPP program in

the name of Minnie's Banana Cups and Catering Service, Inc. (hereinafter "Minnie's

Case 5:23-cr-00094-D Document 5 Filed 03/22/23 Page 3 of 11
Banana Cups"), which MONICA BARNES owned. The Defendants were domiciled

in Wilson, North Carolina. E.W. and S.C. resided in Texas.

11. E.W. assisted numerous other companies and individuals (collectively

"Borrowers") located around the country to fraudulently obtain PPP and other

COVID Loans. In exchange for their assistance in obtaining COVID Loans, the

Borrowers such as the Defendants paid E.W. a fee representing a percentage of the

fraudulent loan proceeds. In total, E.W. and their spouse, S.C., collectively

facilitated the fraudulent disbursement of more than $15 Million in COVID Loans.

12. To promote the operation of the scheme, E.W. and S.C. utilized

middlemen to recruit Borrowers. E.W. and S.C. paid, and caused others to pay,

these middlemen a "cut" of the fee charged for securing the fraudulent loans for the

Borrowers.

13. Q.J. was one such Borrower who operated various companies in the

Eastern District of North Carolina. Q.J. utilized E.W. and S.C. to fraudulently

obtain COVID Loans in the names of several companies. In addition to being a

Borrower, Q.J. also served as a middleman, and, directly or indirectly, recruited

additional Borrowers-including the Defendants-for E.W. and S.C. for an agreed

upon fee.

14. To carry out the scheme, the conspirators engaged in the following series

of steps:

a. E.W. came into contact with DONTRELL RAYSHAR BARNES-a

Case 5:23-cr-00094-D Document 5 Filed 03/22/23 Page 4 of 11
Borrower who desired to obtain a PPP loan-through Q.J.

DONTRELL RAYSHAR BARNES then conspired with MONICA

FAYE BARNES, his mother, to obtain a fraudulent PPP loan for

Minnie's Banana Cups with E.W.'s assistance.

b. The Defendants and E.W. communicated through interstate text

messages, phone calls, and emails. During these contacts, the

Defendants discussed the process by which E.W. would assist them

to secure a PPP loan.

c. The Defendants supplied E.W. with various information concerning

themselves and Minnie's Banana Cups, which would be used to

obtain the PPP loan, such as the company's federal tax identification

number and purported payroll information for the prior year. The

Defendants also supplied personal information, such as their driver's

licenses and social security cards. The Defendants also provided

bank account information for the company, including the account

number and routing information.

d. E.W. and S.C. used the information supplied by the Defendants to

fraudulently apply for a PPP loan. In furtherance of the application,

E.W. created documents that falsely reflected such information as

the annual payroll, gross receipts, expenses, number of employees,

and employee names for Minnie's Banana Cups.

Case 5:23-cr-00094-D Document 5 Filed 03/22/23 Page 5 of 11
e. E.W. and S.C. then supplied fraudulent documents to the Defendants

via interstate email transmission for review and signature, such as

the Paycheck Protection Program Borrower Application Form.

These documents were fraudulent because, among other reasons,

they intentionally misrepresented the average monthly payroll and

true number of employees for Minnie's Banana Cups.

f. E.W. and S.C. also supplied to the Defendants via interstate email,

a purported employee listing and annual salary for Minnie's Banana

Cups. MONICA FAYE BARNES signed and returned these

fraudulent documents.

g. E.W. and S.C. also supplied to the Defendants via interstate email,

fraudulent IRS forms: Form 940 and Form 941 documents. The

forms were fraudulent because they misrepresented the actual

annual and quarterly wages for Minnie's Banana Cups. MONICA

FAYE BARNES received, signed, and returned the fraudulent and

backdated Form 940 and Form 941s.

h. The PPP loan application was electronically submitted or caused to

be submitted by E.W. and S.C. in MONICA BARNES' name, and

received through SBA servers located in Oregon, using the

fraudulent information described above, by electronically

transmitting the information to the lending institution, Harvest

Case 5:23-cr-00094-D Document 5 Filed 03/22/23 Page 6 of 11
Small Business Finance, LLC, which 1s based m California, via

interstate wire transmission.

1. Specifically, the fraudulent PPP application and supporting

paperwork claimed seven employees and an annual payroll of

approximately $700,000, figures designed to yield a PPP loan in

amount of just under $150,000. E.W. engineered this result because

he would be able to apply for forgiveness from the SBA with minimal

paperwork requirements.

J. MONICA FAYE BARNES or another member of the conspiracy

acting at E.W.'s direction electronically signed the promissory note

or promise to pay.

k. The PPP loan monies were then deposited via interstate wire

transfer into a PNC bank account ending in -4941 associated with

Minnie's Banana Cups.

15. After receiving proceeds from the PPP fraud described above, the

Defendants carried out a series of steps orchestrated by E.W. that made it appear as

though Minnie's Banana Cups was paying biweekly payroll to its employees.

16. Over an approximately four-to-six week period, MONICA FAYE

BARNES wrote checks payable to each of the individuals previously named as

purported employees of Minnie's Banana Cups. Each of the checks contained a

memo notation stating a "pay period" and a two-week interval. Collectively, these

Case 5:23-cr-00094-D Document 5 Filed 03/22/23 Page 7 of 11
checks made it falsely appear that each of the check recipients was engaged in work

on behalf of Minnie's Banana Cups, and receiving regular wages during each of the

sated periods. In reality, none of the check recipients previously received wages

from Minnie's Banana Cups comparable to those paid from the PPP proceeds.

17. The purported employees returned some or all of the money back to the

Defendants, who then wrote checks to E.W. to compensate him for his assistance in

helping the Defendants to fraudulently obtain the PPP loan.

18. E.W., acting on the Defendants' behalf, successfully applied for loan

forgiveness from the SBA by falsely attesting that the PPP proceeds were used to pay

legitimate employee wages.

THE CHARGE

19. The United States Attorney realleges and incorporates by reference

herein all of the allegations contained in the preceding paragraphs of this Criminal

Information, and further alleges that MONICA FAYE BARNES, DONTRELL

RAYSHAR BARNES, E.W., and others known to the United States Attorney, carried

out the conspiracy in the manner and means as set forth in those paragraphs.

20. From in or about March 2021 to in or about September 2021, in the

Eastern District of North Carolina and elsewhere, the Defendants MONICA FAYE

BARNES and DONTRELL RAYSHAR BARNES, and others known to the United

States Attorney, did knowingly combine, conspire, confederate, and agree, and did

have a tacit understanding with each other, to commit an offense against the United

Case 5:23-cr-00094-D Document 5 Filed 03/22/23 Page 8 of 11
States: that is, to knowingly devise and intend 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, and for the purpose of executing

such scheme and artifice, to knowingly transmit and cause to be transmitted by

means of wire communication in interstate commerce, any writings, signs, signals,

and sounds in violation of Title 18, United States Code, Section 1343.

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

Case 5:23-cr-00094-D Document 5 Filed 03/22/23 Page 9 of 11
FORFEITURE NOTICE

Notice is hereby given that all right, title and interest in the property described

herein is subject to forfeiture.

Upon conviction of any offense charged herein constituting "specified unlawful

activity" (as defined in 18 U.S.C. §§ 1956(c)(7) and 1961(1)), or a conspiracy to commit

such offense, the defendant shall forfeit to the United States, pursuant to 18 U.S.C.

§ 98l(a)(l)(C), as made applicable by 28 U.S.C. § 2461(c), any property, real or

personal, which constitutes or is derived from proceeds traceable to the said offense.

The forfeitable property includes, but is not limited to, the following:

Forfeiture Money Judgment:

a) A sum of money representing the gross proceeds of the offense(s) charged

herein against MONICA FAYE BARNES in the amount of at least $94,791.

If any of the above-described forfeitable property, as a result of any act or

omission of a 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 divided 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 said defendant up to the value of the

Case 5:23-cr-00094-D Document 5 Filed 03/22/23 Page 10 of 11
forfeitable property described above.

MICHAEL F. EASLEY, JR
United States Attorney

BY:
~
Assistant United States Attorney

Case 5:23-cr-00094-D Document 5 Filed 03/22/23 Page 11 of 11

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