Indictment — United States v. Whitney Adwan Mack, Southern District of Georgia (Document 1)

Summary

An indictment filed November 5, 2020 in United States of America v. Whitney Adwan Mack, No. CR120 104 (Case 1:20-cr-00104-DHB-BKE), in the U.S. District Court for the Southern District of Georgia, Augusta Division, as Document 1. Counts One through Four charge wire fraud under 18 U.S.C. § 1343 for online EIDL applications submitted on or about July 7, 2020, July 12, 2020 and July 31, 2020 on behalf of Malae Enterprises, UMB Distributors and Wholesalers, Adwan Cosmetics and Upscale Measures Wholesale and Distributors. Counts Five and Six charge misuse of a Social Security number under 42 U.S.C. § 408(a)(7)(B) for the Adwan Cosmetics and Upscale Measures applications. The indictment alleges that the SBA deposited $150,000 on or about August 3, 2020 on the Adwan Cosmetics application and lists cash withdrawals and Miami spending. It includes forfeiture allegations.

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“Indictment — United States v. Whitney Adwan Mack, Southern District of Georgia (Document 1).” Original at ecf.gasd.uscourts.gov. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/indictment-usa-v-mack-dkt-1-539d4891a5/, SHA-256 2219adf978f189a272e4a4ca17853d2ac7e44b5abcd608e0857d2f4ca51296cc.

Full text

Case 1:20-cr-00104-DHB-BKE Document 1 Filed 11/05/20 Page 1 of 11

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF GEORGIA
AUGUSTA DIVISION

UNITED STATES OF AMERICA

INDICTMENT NO. CR120 104
V.

Counts One-Four
18 U.S.C.§ 1343
WHITNEY ADWAN MACK, Wire Fraud

Counts Five-Six
42 U.S.C.§ 408(a)(7(B)
Misuse of Social Security Number

THE GRAND JURY CHARGES THAT:

At times relevant to this Indictment:

1. The Coronavirus Aid, Relief, and Economic Security("CARES")Act is a

federal law enacted in or about March 2020 designed to provide emergency financial

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

COVXD-19 pandemic.

2. Among other relief efforts, the United States sought to provide financial

support to eligible businesses that could be used to offset certain business expenses.

3. WHITNEY ADWAN MACK fraudulently sought hundreds of

thousands of dollars in relief payments through a series of false and fraudulent
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Case 1:20-cr-00104-DHB-BKE Document 1 Filed 11/05/20 Page 2 of 11

The Defendant and Her Related Businesses

4. MACK maintained a residence in the Southern District of Georgia,

Augusta Division.

5. Upscale Measures Wholesale & Distributor LLC was registered with the

State of Georgia on June 29, 2020 and lists its principal address as a residence in

Louisville, Georgia. MACK is listed as the entity's registered agent with the State of

Georgia. MACK's address with the State of Georgia is the same as the entity's

primary office address in Louisville, Georgia.

6. Adwan Cosmetics, UMB Distributors & Wholesalers, and Malae

Enterprises were entities purportedly owned and operated by MACK. None of these

entities are registered to do business in the State of Georgia.

The Coronavirus Aid. Relief and Economic Security Act

7. The SEA is an executive branch agency ofthe United States government

that provides support to entrepreneurs and small businesses. The SEA is

headquartered in Washington, DC and maintains its computer servers outside of the

State of Georgia. The SEA's mission is to maintain and strengthen the nation's

economy by enabhng the establishment and viability of small businesses and by

assisting in the economic recovery of communities after disasters.

8. As part of this effort, the SEA enables and provides for loans through

banks, credit unions, and other lenders. These loans have government-backed

guarantees. In addition, the SEA provides loans that come directly from the U.S.

Government.
Case 1:20-cr-00104-DHB-BKE Document 1 Filed 11/05/20 Page 3 of 11

9. One source of relief provided by the CARES Act was the authorization

for the SBA to provide Economic Injury Disaster Loans ("EIDL") to eligible small

businesses experiencing substantial financial disruption due to the COVID-19

pandemic.

10. In addition, the CARES Act authorized the SBA to issue advances of up

to $10,000 to small businesses within three days of applying for an EIDL ("EIDL

Advance"). The amount of the EIDL Advance an eligible business could receive was

determined based on the businesses number of employees certified by the applicant,

11. In order to obtain an EIDL and/or EIDL Advance, a qualifying business

had to submit an online application to the SBA and provide information about its

operations, such as the number of employees, gross revenues for the twelve-month

period preceding the disaster, and the cost of goods sold in the twelve-month period

preceding the disaster. In the case of EIDLs and EIDL Advances for COVID-19 relief,

the twelve-month period was that preceding January 31, 2020. The applicant also

had to certify all the information the in application is true and correct to the best of

the applicant's knowledge.

12. EIDL applications were submitted directly to the SBA online at

https://covid 19relief.sba.gov/#/ and processed by the agency with support from a

government contractor. Rapid Finance. The amount of the loan was determined
based, in part, on the information provided by the application about employment,

revenue, and cost of goods, as described above. Any funds issued under an EIDL or

EIDL Advance were issued directly by the SBA.
Case 1:20-cr-00104-DHB-BKE Document 1 Filed 11/05/20 Page 4 of 11

13. EIDL funds could be used for payroll expenses, sick leave, production

costs, and business obligations, such as debts, rent, and mortgage payments.
Case 1:20-cr-00104-DHB-BKE Document 1 Filed 11/05/20 Page 5 of 11

COUNTS ONE THROUGH FOUR
Wire Fraud
18 U.S.C. § 1343

14. The Grand Jury re-alleges and incorporates by reference the allegations

in the proceeding paragraphs.

15. Beginning in or around June, 2020, and continuing until at least

September, 2020, in the Southern District of Georgia, and elsewhere. Defendant,

WHITNEY MACK,

did 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.

Object of the Scheme

16. The object of the scheme described in Paragraph 15 for Defendant,

MACK,was to unjustly enrich herself and others by obtaining EIDL proceeds under

false and misleading pretenses including by making false statements about the

number of individuals her company employed, gross revenues, her identity, and the

intended use of the loan proceeds.

Manner and Means

17. On behalf of her "companies," MACK submitted or caused to be

submitted several SBA loan apphcations at https://covidl9relief.sba.gOv/#/:

a. On or about July 7, 2020, MACK submitted, or caused to be submitted,

an electronic appHcation for an EIDL firom the SBA ("EIDL Application

-9559") on behalf of Malae Enterprises. In connection with EIDL
Case 1:20-cr-00104-DHB-BKE Document 1 Filed 11/05/20 Page 6 of 11

Application 9559, MACK falsely affirmed, among other information,

that Malae Enterprises had 10 employees, and that in the twelve

months prior to the disaster the business had $67,489 in gross revenue

and $24,398 in cost of goods sold. MACK used her true Social Security

Number("SSN")on EIDL Application 9559.

b. On or about July 7, 2020, MACK submitted, or caused to be submitted,

an electronic application for an EIDL from the SBA ("EIDL Application

-1312") on behalf of UMB Distributors and Wholesalers. In connection

with EIDL Application 1312, MACK falsely affirmed, among other

information, that UMB Distributors and Wholesalers had 40 employees,

and that in the twelve months prior to the disaster the business had

$54,899 in gross revenue and $54,899 in cost of goods sold. MACK used

her true SSN on EIDL Application 1312.

c. On or about July 12, 2020, MACK submitted, or caused to be submitted,

an electronic application for an EIDL from the SBA ("EIDL Application

-7361") on behalf of Adwan Cosmetics. In connection with EIDL

Application 7361, MACK falsely affirmed, among other information,

that Adwan Cosmetics had 30 employees, and that in the twelve months

prior to the disaster the business had $750,000 in gross revenue and

$300,000 in cost of goods sold. In addition, MACK used SSN xxx-xx-

6432 on EIDL Application 7361, when, as MACK well knew, her actual

SSN is xxx-xx-3092.
Case 1:20-cr-00104-DHB-BKE Document 1 Filed 11/05/20 Page 7 of 11

d. On or about July 31, 2020, MACK submitted, or caused to be submitted,

an electronic application for an EIDL from the SBA ("EIDL Application

-5038") on behalf of Upscale Measures Wholesale and Distributors. In

connection with EIDL Application 5038, MACK falsely affirmed, among

other information, that Upscale Measures Wholesale and Distributors

had 16 employees, and that in the twelve months prior to the disaster

the business had $3,500,000 in gross revenue and $800,000 in cost of

goods sold. In addition, MACK used SSN xxx-xx-6985 on EIDL

Application 5038, when, as MACK well knew, her actual SSN is xxx-xx-

3092.

18. On or about August 3, 2020, in reliance on MACK's false

representations in "EIDL Application -7361" on behalf of Adwan Cosmetics, the SBA

deposited money $150,000 into a bank account in MACKs name at"Bank 1."

19. On or about August 10, 2020, MACK transferred $131,779.94 from

"Bank 1" of the $150,000 she received from EIDL Application 7361 into an account in

the name of another one of her "businesses,""UMB Distributors and Wholesalers," at

"Bank 2" located in Augusta, Georgia. MACK had opened the account at Bank 2 in

July 2020.

20. MACK used her SBA loan funds to transfer thousands of dollars to a

personal associate, take a trip to Miami, Florida, and make cash withdrawals in the

tens of thousands of dollars. These expenditures include, but are not limited to:

a. Withdrawing $10,000 in cash on August 19, 2020;
Case 1:20-cr-00104-DHB-BKE Document 1 Filed 11/05/20 Page 8 of 11

b. Spending $714.39 at Valiant Paris in Miami Beach, Florida on August
22, 2020;

0. Spending $233.25 on hotels in Miami, Florida on August 25 and 26,
2020;

d. Spending $191.62 at Steve Madden on August 28, 2020;
e. Paying $1,415.72 for an AIR BNB in Miami Beach, FL on August 29,
2020;

f. Withdrawing $7,000 in cash on September 4, 2020; and
g. Wiring a personal associate $5,000 on September 11, 2020.

The Wirings

21. On or about the dates specified as to each count below, in the Southern

District of Georgia, and elsewhere, WHITNEY ADWAN MACK,for the purpose of

executing the scheme and artifice described above, and attempting to do so, caused

to be transmitted by means of wire communication from the state Georgia to a

location outside of Georgia the signals and sounds described below for each count,

each transmission constituting a separate count:

Count Date of Wire Descrintion

1 July 7, 2020 Online submission of EIDL Application
******9559 on behalf of Malae
Enterprises.
2 July 7, 2020 Online submission of EIDL Application
******1312 on behalfof UMB Distributors
and Wholesalers.
3 July 12, 2020 Online submission of EIDL Application -
******7361 on behalfofAdwan Cosmetics.
4 July 31, 2020 Online submission of EIDL Application
******5038 on behalfof Upscale Measures
Wholesale and Distributors

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

8
Case 1:20-cr-00104-DHB-BKE Document 1 Filed 11/05/20 Page 9 of 11

COUNTS FIVE AND SIX
Misuse of Social Security Number
42 U.S.C. § 408(a)(7)(B)

22, The Grand Jury re-alleges and incorporates by reference the allegations

in the proceeding paragraphs.

23. On or about the dates specified as to each count below, in the Southern

District of Georgia, and elsewhere, WHITNEY ADWAN MACK,for the purpose of

obtaining something of value and for other purposes, did knowingly, and with intent

to deceive, falsely represent and cause to be represented that SSN xxx-xx-6432 and

SSN xxx-xx-6985 had been assigned to her by the Commissioner ofthe Social Security

Administration (SSA), when she submitted loan applications to the SBA, when, in

fact, as she well knew,SSN xxx-xx-6432 and SSN xxx-xx-6985 had not been assigned

to WHITNEY ADWAN MACK by the Commissioner of the SAA:

Count AnDroximate Date Descrintion

5 July 12, 2020 Online submission of EIDL Application -
7361 on behalf of Adwan Cosmetics with
SSN xxx-xx-6432
6 July 31, 2020 Online submission of EIDL Application
5038 on behalf of Upscale Measures
Wholesale and Distributors with SSN xxx-
xx-6985

All in violation of Title 42, United States Code, Section 408(a)(7)(B).
Case 1:20-cr-00104-DHB-BKE Document 1 Filed 11/05/20 Page 10 of 11

FORFEITURE ALLEGATIONS

The allegations contained in Counts One through Four of this Indictment are

hereby re-alleged and incorporated by reference for the purpose of alleging forfeiture

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 Title 18 offense set forth in Counts One through Four

of this Indictment, the Defendant WHITNEY ADWAN MACK shall forfeit to the

United States pursuant to Title 18, United States Code, Section 981(a)(1)(C), any

property, real or personal, which constitutes or is derived from proceeds traceable to

the charged offense.

If any of thie property described above, as a result of any act or omission of 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 that cannot be divided without
difficulty,

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

pursuant to 21 U.S.C. § 853(p), as incorporated by 28 U.S.C. § 2461(c).

10
Case 1:20-cr-00104-DHB-BKE Document 1 Filed 11/05/20 Page 11 of 11

True

David H. Estes Patrick J. Schwedler
Assistant United States Attorney Assistant United States Attorney
*Lead Counsel

Karl Knoche J. Thomas Clarkson
Assistant United States Attorney Assistant United States Attorney
Chief, Criminal Division *Co-lead Counsel

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