Marina del Rey Man Arrested for Allegedly Fraudulently Obtaining More Than $3 Million in COVID Business Loans for Shell Companies
Summary
Mark Farag Shehata, 70, of Marina del Rey, also known as “Samy Farag,” “Mark Farag” and “Mark Fshehata,” was arrested on a federal grand jury indictment alleging that Shehata fraudulently obtained nearly $3.2 million in COVID-19 loans for businesses that were shell companies, the Justice Department announced. Shehata pleaded not guilty to seven counts of wire fraud; a July 24 trial date and a $500,000 bond were set. The indictment, returned on June 8, alleges that from May 2020 to May 2021 Shehata submitted at least seven false PPP loan applications for four limited liability companies, Shirmak Group LLC, Cynergy Group Internatioal (sic) LLC, Global Network Investments LLC and Alpha and Omega Group LLC, requesting a total of $5,423,989 and obtaining approximately $3,154,265. An indictment is merely an allegation; each count carries a statutory maximum of 20 years.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
Full text
LOS ANGELES – A Westside man has been arrested on a federal grand jury indictment alleging he fraudulently obtained nearly $3.2 million in COVID-19 loans for his businesses that, in fact, were shell companies, the Justice Department announced today. Mark Farag Shehata, 70, a.k.a. “Samy Farag,” “Mark Farag,” and “Mark Fshehata,” of Marina del Rey, was arrested Monday morning by federal agents and was arraigned late Monday in United States District Court in downtown Los Angeles. Shehata pleaded not guilty to seven counts of wire fraud. A July 24 trial date was scheduled, and a $500,000 bond was set in this case. According to a federal grand jury indictment returned on June 8 and unsealed Monday, Shehata organized and registered four limited liability companies that purportedly operated in Marina del Rey: Shirmak Group LLC; Cynergy Group Internatioal ( sic ) LLC; Global Network Investments LLC; and Alpha and Omega Group LLC. From May 2020 to May 2021, Shehata allegedly submitted at least seven false and fraudulent loan applications under the Paycheck Protection Program (PPP), a financial aid plan Congress enacted to support businesses harmed by the COVID-19 pandemic’s economic impact. The PPP loans were to be used by recipients to pay only certain authorized business expenses, such as payroll, mortgage interest, lease, and utilities. Shehata’s four businesses were nothing more than shell companies, the indictment alleges. None of the PPP loan proceeds Shehata allegedly fraudulently obtained were used to make payments to employees for payroll or any business expenses. In furtherance of the scheme, Shehata submitted to the Small Business Administration and several lenders false applications requesting a total of $5,423,989 in PPP loans, and fraudulently obtained approximately $3,154,265 in PPP proceeds, the indictment alleges. An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law. If convicted, Shehata would face a statutory maximum sentence of 20 years in federal prison for each count. The United States Department of Justice Office of Inspector General investigated this matter. This case was investigated by the Pandemic Response Accountability Committee (PRAC) Fraud Task Force. The PRAC was established to serve the American public by promoting transparency and facilitating coordinated oversight of the federal government’s COVID-19 pandemic response. The PRAC’s 21 member Inspectors General identify major risks that cross program and agency boundaries to detect fraud, waste, abuse, and mismanagement in the more than $5 trillion in COVID-19 spending. The PRAC Fraud Task Force brings together agents from 15 Inspectors General to investigate fraud involving a variety of programs, including the Paycheck Protection Program. Task force agents who are detailed to the PRAC receive expanded authority to investigate pandemic fraud as well as tools and training to support their investigations. Assistant United States Attorney Valerie L. Makarewicz of the Major Frauds Section is prosecuting this case. Anyone with general information about allegations of attempted fraud involving COVID-19 can report it by calling the Justice Department’s National Center for Disaster Fraud Hotline at (866) 720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form .
File and source
- File
- doj-usao-cdca-press-release-marina-del-rey-man-arrested-allegedly-fraudulently-obtaining-more-3-million-covid-2023-06-13.json
- Size
- 4,775 bytes
- SHA-256
- 9d3c75b617b06383c7b10876ab1b7efedc17e67b7141c2d079f875e3c29e5169
- Original
- www.justice.gov