U.S. Attorney's Office, Texas, Southern, "Million-dollar PPP scheme sends Sugar Land man to prison" (Aug. 7, 2024)

Summary

Press release of August 7, 2024 from the United States Attorney's Office for the Southern District of Texas, issued from Houston, reporting that a 43-year-old Sugar Land man who pleaded guilty April 10 was sentenced by U.S. District Judge Lee H. Rosenthal to 48 months in federal prison followed by three years of supervised release and ordered to pay $1 million in restitution to the Small Business Administration. In or around April 2021 he created a fictitious temporary workforce business and payroll documents to qualify for Paycheck Protection Program funds, then converted the money to stock trading, where the court heard he almost immediately lost it. The scheme caused a loss of more than $1 million; he was permitted to remain on bond pending voluntary surrender, and Homeland Security Investigations conducted the investigation.

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

HOUSTON – A 43-year-old man has been sentenced for submitting fake and fraudulent Small Business Administration (SBA) Paycheck Protection Program (PPP) loan application documents and collecting the money for personal use, announced U.S. Attorney Alamdar S. Hamdani.

Zain Khan pleaded guilty April 10.

U.S. District Judge Lee H. Rosenthal has now ordered Khan to serve 48 months in federal prison to be immediately followed by three years of supervised release. At the hearing, the court heard additional testimony that described how Khan almost immediately lost the money he stole in various stock trading maneuvers. Khan was further ordered to pay $1 million in restitution to the SBA. In handing down the sentence, Judge Rosenthal noted the severity of Khan’s criminal activity at a time when the country was suffering from the effects of the COVID-19 pandemic.

In or around April 2021, Khan created a fictitious temporary workforce business and payroll documents to qualify for program funds. Khan then converted the program funds for personal use to be invested in stock trading.

The federal government created the PPP under the CARES Act to protect jobs during the 2020 pandemic. The PPP allows entities to apply for low-interest private loans to pay for payroll and certain other related costs.

The scheme caused a loss of more than $1 million.

Khan was permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future.

Homeland Security Investigations conducted the investigation. Assistant U.S. Attorneys Craig M. Feazel and Thomas Carter prosecuted the case.

File and source

File

doj-usao-sdtx-press-release-million-dollar-ppp-scheme-sends-sugar-land-man-prison-2024-08-07.json

Size

2,570 bytes

SHA-256

f662ad4e76d887094a20a1c98917e269ee9e6c7154e8672d10319924e0e114a3

Our copy

doj-usao-sdtx-press-release-million-dollar-ppp-scheme-sends-sugar-land-man-prison-2024-08-07.json

Original

www.justice.gov