Indictment — No. 1:24-cr-00323 (Dkt. 1, D.D.C.)

Summary

An indictment filed July 16, 2024 as Document 1 in United States v. Jose Biaou, Case 1:24-cr-00323-CRC, in the U.S. District Court for the District of Columbia. The caption lists violations of 18 U.S.C. § 1343 (Wire Fraud) and 18 U.S.C. § 641 (Theft of Government Property), with criminal forfeiture. The introduction identifies the defendant as the chief executive officer of FRB Capital Group LLC d/b/a FRB Realty Capital and describes the Small Business Administration, the Paycheck Protection Program and second draw loans under the Economic Aid to Hard-Hit Small Business, Nonprofits and Venues Act. Counts One through Six are captioned Wire Fraud, and the forfeiture section names a 2010 Porsche and a money judgment.

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Case 1:24-cr-00323-CRC Document1 Filed 07/16/24 Page 1 of 13

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA

Holding a Criminal Term

Grand Jury Sworn in on June 14, 2024

UNITED STATES OF AMERICA

v. $ VIOLATIONS:
JOSE BIAOU, ‘ 18 U.S.C. § 1343 (Wire Fraud);
: 18 U.S.C. § 641 (Theft of Government
Defendant. : Property);

18 U.S.C. §§ 981(a)(1)(C), 982(a)(2)(A);
21 U.S.C. § 853(p); 28 U.S.C. § 2461(c)
(Criminal Forfeiture).
INDICTMEN T
The Grand Jury charges that, on or about the times and dates stated herein:
Introduction
At all times relevant to this Indictment:
The Defendant and Relevant Entities

1. Defendant JOSE BIAOU (“BIAOU”) is a citizen of Benin and current resident of
Washington, D.C.

2. BIAOU was the Chief Executive Officer of FRB Capital Group LLC d/b/a FRB Realty
Capital (hereinafter, “FRB”), a D.C. Limited Liability Corporation formed by BIAOU in D.C. on
September 4, 2013, and controlled by BIAOQU. The purpose of FRB was to broker loans between
financial institutions and investors on the one hand and commercial developers on the other.

3. BIAOU maintained business checking accounts on behalf of FRB at JP Morgan Chase &

Co. (“JP Morgan”) ending in 3070 and at PNC Bank (“PNC’”) ending in 1469.
Case 1:24-cr-00323-CRC Document1 Filed 07/16/24 Page 2 of 13

4. JP Morgan and PNC were participating lenders under the Paycheck Protection Program
(“PPP”), as described below. 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 and administered the PPP.

The Small Business Administration

5. 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. The SBA is located at 409 3rd Street, Southwest in Washington, D.C.

The Paycheck Protection Program

6. 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 suffering the economic effects caused by the COVID-19 pandemic. One
source of relief provided by the CARES Act was the authorization of billions of dollars in
forgivable loans to small businesses for job retention and certain other expenses, through a
program referred to as the PPP.

7. To obtain a PPP loan, a qualifying business must have submitted a PPP loan application,
signed by an authorized representative of the business. The applicant of a PPP loan was required
to acknowledge the program rules and make certain affirmative certifications in order to be eligible
to obtain the PPP loan. In the PPP loan application, the applicant was required to state, among
other things, its: (a) average monthly payroll expenses and (b) 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 must have provided documentation showing

their payroll expenses. To qualify for eligibility, businesses that applied for a PPP loan needed to
Case 1:24-cr-00323-CRC Document1 Filed 07/16/24 Page 3 of 13

be in operation as of February 15, 2020. The applicant was also required to certify that all the
information in the application was true and correct.

8. PPP loan applications were processed by a participating financial institution (the lender).
If a PPP loan application was approved, the participating financial institution funded the PPP loan
using its own monies, 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 to the SBA in the course of processing the loan.

9. PPP loan proceeds were required to be used by the applicant business for certain
permissible expenses, including payroll costs, interest on mortgages, rent, and utilities. The PPP
allowed the interest and principal on the PPP loan to be entirely forgiven if the business spent the
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.

10. In or around December 27, 2020, the Economic Aid to Hard-Hit Small Business,
Nonprofits and Venues Act provided additional funding for the PPP and extended the application
deadline to March 31, 2021. The act enabled borrowers to take a second draw PPP loan under the
same general terms as their first PPP loan up to a maximum loan amount of $2 million. The act
reopened the program to borrowers who did not previously receive a first draw PPP loan. To be
eligible for a second draw, borrowers were required to employ no more than 300 employees,
demonstrate a 25% reduction in gross receipts during a calendar quarter in 2020, and have
expended the full amount of their initial PPP loan. Allowable expenses were expanded to include
worker protection costs related to COVID-19, uninsured property damage costs caused by looting
or vandalism during 2020, and certain supplier costs and expenses for operations. The expansion

applied retroactively to first draw PPP loans that had not been forgiven by the SBA.
Case 1:24-cr-00323-CRC Document1 Filed 07/16/24 Page 4 of 13

11. In or around March 25, 2021, the PPP Extension Act of 2021 extended the application
deadline from March 31, 2021 to May 31, 2021. In addition to extending the PPP application
filing window by 60 days, the Extension Act provided an extra 30 days for the SBA to finish
processing applications received by the May 31, 2021 deadline.

The Economic Injury Disaster Loan Program

12. The Economic Injury Disaster Loan (“EIDL”) program was a disaster relief program
administered by the SBA that predated the COVID-19 pandemic. Small business owners and
non-profit organizations in all U.S. states, the District of Columbia, and U.S. territories could apply
for an EIDL. EIDLs were designed to provide economic relief to businesses that were
experiencing a temporary loss of revenue due to a disaster. EIDL proceeds were not intended to
replace lost sales or profits or for expansion of a business. Unlike certain other types of SBA-
guaranteed loans, EIDL funds were issued directly from the United States Treasury, and applicants
applied through the SBA via an online portal and application.

13. To obtain an EIDL, a qualifying business was required to submit an application to the SBA
and provide information about its operations, such as the number of employees, gross revenues for
the 12-month period preceding the disaster, and cost of goods sold in the 12-month period
preceding the disaster. In the case of EIDLs for COVID-19 relief, the 12-month period was the
year preceding January 31, 2020. The applicant was also required to certify that all the
information in the application was true, correct, and complete, and agree in the required Loan
Authorization and Agreement that the EIDL funds would be used solely as working capital to
alleviate economic injury caused by disaster. The applicant was warned that any false statement
or misrepresentation to the SBA or any misapplication of loan proceeds might result in sanctions,

including criminal penalties.
Case 1:24-cr-00323-CRC Document1 Filed 07/16/24 Page 5 of 13

14. The amount of an EIDL, if the application was approved, was determined based, in part,
on the information provided in the application about employment, revenue, and cost of goods, as
set forth above. Any funds issued under an EIDL were issued directly by the SBA. EIDL funds
were required to be used as working capital, such as payroll expenses, sick leave, production costs,

and ordinary business obligations, such as debts, rent, and mortgage payments.

COUNTS ONE THROUGH SIX
(Wire Fraud)

15. Paragraphs 1 through 14 are realleged.

The Scheme to Defraud

16. Beginning in at least April 2020, and continuing through at least December 2022, in the
District of Columbia and elsewhere, the defendant, JOSE BIAOU, knowingly devised, intended
to devise, and participated in a scheme and artifice to defraud and to obtain money and property
by means of materially false and fraudulent pretenses, representations, and promises, that is,
BIAOU submitted and caused to be submitted three PPP loan applications and two EIDL
applications that contained false and fraudulent representations and obtained loans as a result of
those false and fraudulent representations.

Purpose of the Scheme to Defraud

17. It was a purpose of the scheme to defraud that JOSE BIAOU would enrich himself by
obtaining PPP and EIDL funds that he was not entitled to receive.

Manner and Means of Scheme to Defraud

It was part of the scheme to defraud that:
FRB’s First PPP Application
18. On April 9, 2020, BIAOU submitted an application to JP Morgan on behalf of FRB

containing false information, seeking to obtain over $225,0000 in PPP loan money.
Case 1:24-cr-00323-CRC Document1 Filed 07/16/24 Page 6 of 13

19. In that application, BIAOU, claimed that FRB had seven employees with an average
monthly payroll of $90,000, when in fact, FRB had one full-time employee and two independent
contractors, who, during the entire year, made approximately a combined $140,000, with an
average monthly payroll of approximately $11,700.

20. BIAOU included in his application a payroll summary purporting to be from FRB’s payroll
service provider Gusto, Inc. (“Gusto”), that was not, in fact, consistent with Gusto’s records for
FRB. Namely, the paperwork listed seven employees for each month of the calendar year and
indicated that for every month, the seven employees were paid almost $90,000 in wages per month,
when again, only three employees received wages from FRB during 2019.

21. Based on the false representations, JP Morgan approved BIAOU’s application and
electronically transferred $225,000 in loan proceeds into BIAOU’s JP Morgan account ending in
3070.

Forgiveness of First PPP Loan

22. On December 1, 2022, BIAOU submitted a false application on behalf of FRB to JP
Morgan for forgiveness of the initial $225,000 loan.

23. In support of that application, BIAOU made misrepresentations about FRB’s purported
rent payments to its landlord. Specifically, BIAOU submitted a record of payments reflecting a
monthly rent of $13,827, as well as six checks purporting to be rent checks issued from FRB’s
business checking account at TD Bank, as well as a signed copy of a second supplemental lease
agreement entered into by BIAOU and his landlord memorializing the schedule of monthly base
rent. The signed lease agreement was fraudulent, with BIAOU having forged or caused to be

forged the signatures. The checks were also fraudulent, and the actual monthly rent payments
Case 1:24-cr-00323-CRC Document1 Filed 07/16/24 Page 7 of 13

made to the landlord were each $10,000 less than the $13,827 BIAOU fraudulently represented
on his forgiveness application. |
FRB Second PPP Application

24. On February 17, 2021, BIAOU submitted on behalf of FRB a fraudulent loan application
to PNC, a financial institution, to obtain $222,500 in a second PPP loan.

25.In support of that application, BIAOU made the false and fraudulent claim that FRB
employed ten employees, when in fact FRB employed only between one and two salaried
employees, and BIAOU also falsely claimed that FRB had an average monthly payroll of
approximately $89,900, when according to FRB’s tax returns, between the two employees, the
average monthly payroll was approximately $8,500.

26. In support of that application, BIAOU caused the submission of false and fraudulent
payroll records purporting to be from Gusto, which remained FRB’s payroll service provider at
that time. The payroll records BIAOU submitted suggested FRB employed ten individuals and
had average monthly payroll costs associated with them. These documents were fraudulent
because the information contained in them did not in fact come from Gusto or match Gusto’s
records for FRB.

27. BIAOU, upon approval of his application, caused PNC to electronically transfer $222,500
in loan proceeds into BIAOU’s PNC account ending in 1346.

Millenium Global Finance PPP Application

28. On March 25, 2021, BIAOU submitted on behalf of Millenium Global Finance a fraudulent
loan application to PNC, a financial institution, to obtain over $1,250,000 in PPP loan money.

29. In support of that application, BIAOU falsely certified that Millenium Global Finance was

in operation on February 15, 2020, and “had employees for whom it paid salaries and payroll taxes
Case 1:24-cr-00323-CRC Document1 Filed 07/16/24 Page 8 of 13

or paid independent contractors, as reported on Form(s) 1099-MISC.” In fact, Millenium Global
Finance had neither employees, nor paid independent contractors, nor any revenue. BIAOU also
falsely certified that “current economic uncertainty makes [the] loan request necessary to support
the ongoing operations of the Applicant.”

30. Additionally, in that application, BIAOU falsely claimed that Millenium Global Finance
was an eligible company, with 52 employees in 2019 and average monthly payroll costs of
$523,452.67. In fact, Millenium Global Finance was not even in operation at the time.

31. In support of the application, BIAOU also submitted a false and fraudulent payroll
summary purporting to be from Millenium’s payroll service provider ADP, which ADP later
confirmed was not genuine.

32. BIAQU, upon approval of his application, caused PNC to electronically transfer
$1,250,000 in loan proceeds into BIAOQU’s PNC account ending in 1346.

FRB EIDL Application

33. On August 16, 2021, BIAOU submitted on behalf of FRB a fraudulent loan application to
SBA, to obtain $1,877,600 in EIDL proceeds.

34. In support of that application, BIAOU falsely claimed that he was a U.S. citizen and
provided supporting documentation in the form of a Certificate of Live Birth purporting to be from
the D.C. Department of Health, which the D.C. Vital Records Registrar has confirmed to be
fraudulent.

35. In support of that application, BIAOU caused to be made the false and fraudulent claims
that FRB employed seven employees as of January 2020, and earned $2,250,000 in gross revenue
in 2019, when, in fact, as of January 2020, FRB had one employee and earned approximately

$938,000 in gross revenue in the year prior, according to its tax returns.
Case 1:24-cr-00323-CRC Document1 Filed 07/16/24 Page 9 of 13

36. BIAOU, upon approval of his application, caused SBA to electronically transfer
$1,877,500 in loan proceeds from a U.S. Treasury account into BIAOU’s account with TD Bank
ending in 0674.

Millenium Global Finance EIDL Application

37. On or about December 27, 2021, BIAOU, submitted a fraudulent loan application on
behalf of Millenium Global Finance to obtain $2,000,000.

38. In support of that application, BIAOU caused to be made the false and fraudulent claim
that he was a U.S. citizen and that Millenium Global Finance had 22 employees as of January 2020
and 12 employees as of the time of the application’s submission.

39. SBA later rejected the application, and no funds were ever electronically transferred to the
account designated by BIAOU.

The Charges

40. On or about the dates set forth below, in the District of Columbia and elsewhere, the

defendant,

JOSE BIAOU,
for the purpose of executing and attempting to execute the scheme to defraud described above,
transmitted and caused to be transmitted by means of wire communication in interstate commerce,

the following writings, signs, signals, pictures, and sounds:
Case 1:24-cr-00323-CRC Document1 Filed 07/16/24 Page 10 of 13

Count

Approximate Date

Description

April 9, 2020

An interstate wire signal originating from
Jose Biaou, in the District of Columbia, to
J.P. Morgan Chase containing a false and
fraudulent PPP loan application for $225,000

February 17, 2021

An interstate wire signal originating from
Jose Biaou, in the District of Columbia, to
PNC Bank containing a false and fraudulent
PPP loan application for $222,500

March 25, 2021

A foreign wire signal originating from Jose
Biaou, in Benin, to PNC Bank containing a
false and fraudulent PPP loan application for
$1,250,000

August 16, 2021

A foreign wire signal originating from Jose
Biaou, in Turkey, to SBA containing a false
and fraudulent EIDL application for
$1,877,600

December 27, 2021

An interstate wire signal originating from
Jose Biaou, in the District of Columbia, to
SBA, containing a false and fraudulent EIDL
application for $2,000,000

December 1, 2022

An interstate wire signal originating from
Jose Biaou, in the District of Columbia, to JP
Morgan Chase containing a false and
fraudulent application to forgive the first PPP
loan of $225,000

(Wire Fraud, in violation of Title 18, United States Code, Section 1343).

COUNT SEVEN

(THEFT OF GOVERNMENT PROPERTY)

41. Paragraphs 1 through 14 and 33-36 are realleged.
Case 1:24-cr-00323-CRC Document1 Filed 07/16/24 Page 11 of 13

42. In or around August 2021, in the District of Columbia and elsewhere, the defendant,
JOSE BIAOU,
did willfully and knowingly steal, purloin, and convert to his use and the use of another, any money
and thing of value of the United States and any department and agency thereof, with an aggregate
value that exceeded $1,000, that is, $1,877,500 in EIDL funds paid as a result of EIDL Application
No. 3323201312, submitted under the business name “FRB Realty.”

(Theft of Government Property, in violation of Title 18,
United States Code, Section 641).

NOTICE OF FORFEITURE

The allegations contained in Counts One through Seven of this Indictment are hereby
realleged and incorporated by reference for the purpose of alleging forfeitures pursuant to Title 18,
United States Code, Section 981(a)(1)(C) and Title 28, United States Code, Section 2461(c).

Upon conviction of the offense(s) in violation of Title 18, United States Code, Section
1343, as set forth in Counts One through Six of this Indictment, or Title 18, United States Code,
Section 641, as set forth in Count Seven of this Indictment, the defendant,

JOSE BIAOU,
shall forfeit to the United States of America, pursuant to Title 18, United States Code, Section
981(a)(1)(C) and Title 28, United States Code, Section 2461(c), any property, real or personal,
which constitutes or is derived from proceeds traceable to the offense(s).

NOTICE OF FORFEITURE

The allegations contained in Counts One through Seven of this Indictment are hereby
realléged and incorporated by reference for the purpose of alleging forfeitures pursuant to Title 18,
United States Code, Section 981(a)(1)(C) and Title 28, United States Code, Section 2461(c).

Upon conviction of the offense(s) in violation of Title 18, United States Code, Section
Case 1:24-cr-00323-CRC Document1 Filed 07/16/24 Page 12 of 13

1343, as set forth in Counts One through Six of this Indictment, or Title 18, United States Code,

Section 641, as set forth in Count Seven of this Indictment, the defendant,

JOSE BIAOU,

shall forfeit to the United States of America, pursuant to Title 18, United States Code, Section

981(a)(2)(A), any property, real or personal, which constitutes or is derived from proceeds

traceable to the offense(s).

SPECIFIC PROPERTY SUBJECT TO FORFEITURE

The specific property subject to forfeiture includes, but is not limited to, the following:

1) A 2010 Porsche 997.2 Turbo with Vehicle Identification Number WPO0ZZZ99Z,A576 1202.

MONEY JUDGMENT

Upon conviction, the United States will seek a money judgment.

SUBSTITUTE ASSETS

If any of the property described above, as a result of any act or omission of the defendant:

a.

b.

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,

the United States of America shall be entitled to forfeiture of substitute property pursuant to Title

21, United States Code, Section 853(p), as incorporated by Title 28, United States Code, Section

2461(c).
Case 1:24-cr-00323-CRC Document1 Filed 07/16/24 Page 13 of 13

(Criminal Forfeiture, pursuant to Title 18, United States Code, Section 981(a)(1)(C) and
982(a)(2)(A); Title 28, United States Code, Section 2461(c), and Title 21, United States
Code, Section 853(p))

A TRUE BILL;

Attorney of the United States in
and for the District of Columbia


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