Indictment — United States v. Sinoj Kallamplackal Joseph, Eastern District of Texas (Document 1)

Summary

A grand jury indictment of Sinoj Kallamplackal Joseph, Case No. 4:21-cr-00281-ALM-KPJ, in the U.S. District Court for the Eastern District of Texas, filed October 13, 2021 as Document 1. Counts One through Seven charge wire fraud under 18 U.S.C. § 1343 and Counts Eight through Ten charge false statements to a bank under 18 U.S.C. § 1014. The indictment alleges that Joseph submitted false PPP applications to Radius Bank for MK Analytics, LLC, Sanbi Solutions, LLC and KMS Traders Group, LLC, Wyoming companies formed in 2020, claiming 4, 42 and 97 employees, and received $267,187, $927,087 and $2,040,855. The forfeiture notice seeks a sum of $5,608,170.58 and lists funds seized from bank accounts.

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“Indictment — United States v. Sinoj Kallamplackal Joseph, Eastern District of Texas (Document 1).” Original at archive.org. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/indictment-no-4-21-cr-00281-dkt-1-e-d-tex-6df502c31f/, SHA-256 932f9fb168bffba434e121fdc7b78360d4159b020dc614a833110af0759ae071.

Full text

Case 4:21-cr-00281-ALM-KPJ Document 1 Filed 10/13/21 Page 1 of 13 PageID #: 1

IN THE UNITED STATES DISTRICT COU T
FOR THE EASTERN DISTRICT OF TEXAS
SHERMAN DIVISION

UNITED STATES OF AMERICA §

v- § No. 4:21-CR-
§ 'ud8crM *u
SINOJ KALLAMPLACKAL JOSEPH §

INDICTMENT

THE UNITED STATES GRAND JURY CHARGES: FILED
General Allegations OCT 1 3 2021
At all times relevant to this Indictment: Clerk, U.S. District Court
Texas Eastern

The Defendant and His Entities

1. Sinoj Kallamplackal Joseph (Joseph) was a resident of McKinney, Texas,

in the Eastern District of Texas.

2. MK Analytics, LLC (MK Analytics) registered with Wyoming s Office of

the Secretary of State and filed its Certificate of Organization on May 9, 2020. Joseph

exercised ownership of and control over MK Analytics.

3. Sanbi Solutions, LLC (Sanbi) registered with the Wyoming Office of the

Secretary of State and filed its Certificate of Organization on May 20, 2020. Joseph

exercised ownership of and control over Sanbi.

4. KMS Traders Group, LLC (KMS Traders) registered as an operating

company with the Wyoming Secretary of State on July 1, 2020. Joseph exercised

ownership of and control over KMS Traders.

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The Small Business Ad inistration

5. 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 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. These loans have government-backed guarantees.

The Paycheck Protection Program

7. The Coronavirus Aid, Relief, and Economic Security (CARES) Act was a

federal law enacted in March 2020 and designed to provide emergency financial

assistance to the millions of Americans who are suffering the economic effects caused by

the COVID-19 pandemic. One source of relief provided by the CARES Act was the

authorization of forgivable loans to small businesses for job retention and certain other

expenses, through a program referred to as the Paycheck Protection Program (PPP).

8. 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 order to be

eligible to obtain the PPP loan. In the PPP loan application (SBA Form 2483), the small

business (through its authorized representative) was required to state, among other things,

its: (a) average monthly payroll expenses, and (b) number of employees. These figures

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were used to calculate the amount of money the small business is eligible to receive

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

documentation showing their payroll expenses.

9. A PPP loan application was processed by a participating lender. If a PPP

loan application were approved, the participating lender funded the PPP loan using its

own monies, which were 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.

10. PPP loan proceeds were required to be used on certain permissible expenses,

including payroll costs, mortgage interest, rent, and utilities. Under the applicable PPP

rules and guidance, the interest and principal on the PPP loan is eligible for forgiveness if

the business spent the loan proceeds on these expense items within a designated period of

time and used a certain portion of the loan towards payroll expenses.

Relevant Fi ancial Institutions

11. Bank 1 was a federally insured financial institution and an online-focused

community bank based in Boston, Massachusetts. Bank 1 participated in the Small

Business Administration s Pay check Protection Program as a lender and, as such, was

authorized to lend funds to eligible borrowers under the terms of the PPP.

12. Sanbi and KMS Traders maintained accounts at Bank 1. Joseph was the

only individual with signatory authority on those accounts.

13. Bank 2 was a federally insured financial institution based in Tupelo,

Mississippi with branches throughout the United States.

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14. MK Analytics maintained an account at Bank 2. Joseph was the only

individual with signatory authority on the account.

The Scheme to Defraud

15. From in or about April 2020, and continuing through in or about September

2020, the exact dates being unknown, in the Eastern District of Texas, and elsewhere, the

defendant, Sinoj Kallamplackal Joseph, knowingly devised and intended to devise a

scheme and artifice to defraud Bank 1 and the SBA, and to obtain money and property by

means of materially false and fraudulent pretenses, representations, and promises, namely

by filing false and fraudulent applications for PPP funds.

Purpose of the Scheme and Artifice

16. It was the purpose of the scheme and artifice for the defendant, to unjustly

enrich himself by obtaining PPP loan proceeds through materially false and fraudulent

representations about his companies, including KMS Traders, MK Analytics, and Sanbi,

in PPP loan applications.

Manner and Means

The manner and means by which the defendant sought to accomplish the purpose

of the scheme and artifice included, among others, the following:

MK Analytics, LLC

17. In furtherance of the scheme, on or about May 20, 2020, Joseph submitted

a materially false PPP application to Radius Bank in the name of MK Analytics, LLC

seeking PPP funds (the MK Analytics PPP Application). Joseph signed the MK

Analytics PPP Application as the Manager of MK Analytics. Joseph also certified that

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the application and the information provided in all supporting documents and forms was

true and accurate.

18. The MK Analytics PPP Application falsely stated that MK Analytics

average monthly payroll was $142,450 and that the company had 4 employees. In

support of the application, Joseph submitted several false payroll documents, including

Employer’s Quarterly Federal Tax Returns (IRS Form 941s) for MK Analytics, an

Employer’s Annual Federal Unemployment Tax Return (IRS Form 940) for MK

Analytics, and other fraudulent payroll records.

19. Radius Bank approved the MK Analytics PPP Application and, on June 1,

2020, dispersed PPP funds of $267,187 into MK Analytics business checking account

xxxx-426-6 at BancorpSouth. Joseph was the only individual with signatory authority

on the account.

Sanbi Solutions, LLC

20. In furtherance of the scheme, on or about June 2, 2020, Joseph submitted a

materially false PPP application to Radius Bank in the name of Sanbi Solutions, LLC

seeking PPP funds (the Sanbi PPP Application). Joseph signed the Sanbi PPP

Application as the Finance Manager of Sanbi. Joseph also certified that the application

and the information provided in all supporting documents and forms was true and

accurate.

21. The Sanbi PPP Application falsely stated that Sanbi’s average monthly

payroll was $370,835 and that the company had 42 employees. In support of the

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application, Joseph submitted several false payroll documents, including IRS Form 941s

for Sanbi, an IRS Form 940 for Sanbi, and other fraudulent payroll records.

22. Radius Bank approved the Sanbi PPP Application and, on June 19, 2020,

dispersed PPP funds of $927,087 into Sanbi s business checking account xxxxxx5867 at

Radius Bank. Joseph was the only individual with signatory authority on the account.

KMS Traders Group, LLC

23. In furtherance of the scheme, on or about June 23, 2020, Joseph submitted a

materially false PPP application to Radius Bank in the name of KMS Traders Group,

LLC seeking PPP funds (the KMS Traders PPP Application). Joseph signed the KMS

Traders PPP Application as the CEO of KMS Traders. Joseph also certified that the

application and the information provided in all supporting documents and forms was true

and accurate.

24. The KMS Traders PPP Application falsely stated that KMS Traders average

monthly payroll was $816,342 and that the company had 97 employees. In support of the

application, Joseph submitted several false payroll documents, including IRS Form 941s

for KMS Traders, an IRS Form 940 for KMS Traders, and other fraudulent payroll

records.

25. Radius Bank approved the KMS Traders PPP Application and, on June 25,

2020, dispersed PPP funds of $2,040,855 into KMS Traders Radius Bank account

xxxxxx3991. Joseph was the only individual with signatory authority on this account.

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Counts One through Seven

Violation: 18U.S.C. § 1343
(Wire Fraud)

26. Paragraphs 1 through 25 of this Indictment are realleged and incorporated by

reference as though fully set forth herein.

Acts in Execution of the Scheme and Artifice

27. On or about the dates specified as to each count below, in the Eastern

District of Texas, and elsewhere, for the purpose of executing and attempting to execute

the above-described scheme and artifice to defraud and obtain money from the victims,

Bank 1 and the SBA, by means of false and fraudulent pretenses, representations, and

promises, the defendant, Sinoj Kallamplackal Joseph, knowingly transmitted and

caused to be transmitted by means of wire communications in interstate commerce the

writings, signs, signals, pictures, and sounds for the described below:

Count Approximate Date Description of Interstate Wire

MK Analytics PPP application electronically
submitted by Sinoj Kallamplackal Joseph in
1 May 20, 2020
Texas and routed by interstate wire through
Bank 1 s servers outside of Texas.
MK Analytics PPP loan documents
electronically submitted by Sinoj
2 June 1, 2020 Kallamplackal Joseph in Texas and routed by
interstate wire through Bank l s servers outside
of Texas.
Interstate wire transfer of $267,187 from Bank 1
3 June 1, 2020 routed interstate to MK Analytics account at
Bank 2.

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Count Approximate Date Description of Interstate Wire

Sanbi PPP application electronically submitted
by Sinoj Kallamplackal Joseph in Texas and
4 June 2, 2020
routed by interstate wire through Bank l s
servers outside of Texas.
Sanbi PPP loan documents electronically
submitted by Sinoj Kallamplackal Joseph in
5 June 19, 2020
Texas and routed by interstate wire through
Bank l s servers outside of Texas.
KMS Traders PPP application electronically
submitted by Sinoj Kallamplackal Joseph in
6 June 23, 2020
Texas and routed by interstate wire through
Bank l s servers outside of Texas.
KMS Traders PPP loan documents
electronically submitted by Sinoj
7 June 25, 2020 Kallamplackal Joseph in Texas and routed by
interstate wire through Bank l’s servers outside
of Texas.

All in violation oflSU.S.C. § 1343.

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Counts Eight through Ten

Violation: 18U.S.C. § 1014
(False Statement to Bank)

28. Paragraphs 1 through 25 of this Indictment are realleged and incorporated by

reference as though fully set forth herein.

29. On or about the dates specified as to each count below, in the Eastern

District of Texas, and elsewhere, the defendant, Sinoj Kallamplackal Joseph,

knowingly made false statements with the intent to influence the actions of a financial

institution, the accounts of which were insured by the Federal Deposit Insurance

Corporation, to wit:

Count Approximate Date False Statements

In the MK Analytics PPP Application, Sinoj
Kallamplackal Joseph falsely represented that
8 May 20, 2020
MK Analytics had 4 employees and an average
monthly payroll of $142,450.
In the Sanbi PPP Application, Sinoj
Kallamplackal Joseph falsely represented that
9 June 2, 2020
Sanbi had 42 employees and an average monthly
payroll of $370,835.
In the KMS Traders PPP Application, Sinoj
Kallamplackal Joseph falsely represented that
10 June 23, 2020
KMS Traders had 97 employees and an average
monthly payroll of $816,342.

All in violation of 18 U.S.C. § 1014.

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NOTICE OF INTENT TO SEEK CRIMINAL FORFEITURE
18 U.S.C. §§ 981(a)(1)(C) and 982(a)(2)(A) and 28 U.S.C. § 2461(c)

As a result of committing the offenses as alleged in this Indictment, the defendant

shall forfeit to the United States, pursuant to 18 U.S.C. §§ 981(a)(1)(C) and 982(a)(2)(A)

and 28 U.S.C. § 2461(c), any and all property, real or personal, involved in or traceable to

property involved in the offense, including proceeds obtained directly or indirectly from

the offense, and the following:

Cash Proceeds

A sum of money equal to $5,608,170.58 in United States currency, and all interest
and proceeds traceable thereto, representing the amount of proceeds obtained by
defendant as a result of the offenses alleged in this Indictment, for which the
defendant is personally liable, the following amounts seized from the following
accounts:

a) $65,158.33 from Radius Bank, Account Number 7160026329;

b) $929,680.50 from Radius Bank, Account Number 7160025867;

c) $2,043,234.95 from Radius Bank, Account Number 7160043991;

d) $171.24 from Discover Bank, Account Number 7002343548;

e) $845,549.55 from Comerica Bank, Account Number 1883128082;

f) $11,137.47 from Bank of America, Account Number 898077963793;

g) $109,283.74 from Bank of America, Account Number 488092960039;

h) $33,700.00 from Bank of America, Account Number 488092960039;

i) $166,306.39 from Bank of America, Account Number 488097820190;

j) $62,474.61 from Bank of America, Account Number 488040483377;

k) $1,061,031.06 from AZLO, Account Number 6787172936; '

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l) $155,738.63 from BancorpSouth, Account Number 7790-426-6;

m) $112,588.47 from BancorpSouth, Account Number 7790-425-8; and

n) $12,115.64 from Austin Telco Federal Credit Union, Account Number
1800261209.

Substitute Assets

If any property subject to forfeiture, as a result of any act or omission by the

defendant:

a) cannot be located upon the exercise of due diligence;
b) has been transferred or sold to, or deposited with a third party;
c) has been placed beyond the jurisdiction of the court;
d) has been substantially diminished in value; or
e) has been commingled with other property which cannot be subdivided
without difficulty,

it is the intent of the United States, pursuant to 21 U.S.C. § 853(p), to seek forfeiture of any

other property of the defendant up to the value of the above forfeitable property, including

but not limited to all property, both real and personal, owned by the defendant.

By virtue of the commission of the felony offenses charged in this Indictment, any

and all interest the defendant has in the above-described property is vested in the United

States and hereby forfeited to the United States pursuant to 18 U.S.C. §§ 981(a)(1)(C) and

982(a)(2)(A) and 28 U.S.C. § 2461(c).

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A TRUE BILL:

gran/ j foreperson

NICHOLAS J. GANJEI
ACTING UNITED STATES ATTORNEY

SEAN L TXYLOR Date
Assistant United States Attorney

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IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF TEXAS
SHERMAN DIVISION

UNITED STATES OF AMERICA §
§
V. § No. 4:21-CR-
§ Judge
SINOJ KALLAMPLACKAL JOSEPH §

NOTICE OF PENALTY

Counts One through Seven

VIOLATION: 18U.S.C. § 1343

PENALTY: Imprisonment for not more than 20 years; the greater
of a fine not to exceed $250,000, a fine not to exceed
two times the gross gain to the defendant, or a fine not
to exceed two times the loss to the victim, or both such
imprisonment and fine; and a term of supervised
release of not more than 3 years.

SPECIAL ASSESSMENT: $100.00 each count

Counts Ei ht through Ten

VIOLATION: 18U.S.C. § 1014

PENALTY: Imprisonment for not more than 30 years; a fine not to
exceed $1,000,000, a fine not to exceed two times the
gross gain to the defendant, or a fine not to exceed two
times the loss to the victim, or both such imprisonment
and fine; and a term of supervised release of not more
than 5 years.

SPECIAL ASSESSMENT: $100.00 each count

Indictment - Page 13

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