U.S. Department of Labor OIG, Camden County Man Admits Defrauding COVID-19 Relief Programs and Illegally Possessing Firearm (USAO D-NJ 07/19/2022) (2022-07-21)

Summary

A July 19, 2022 press release from the U.S. Attorney's Office for the District of New Jersey announcing that Stephen Bennett, of Berlin, New Jersey, pleaded guilty before U.S. District Judge Karen M. Williams to an information charging one count of bank fraud conspiracy, one count of wire fraud, and one count of being a felon in possession of a firearm. According to the release, in 2020 Bennett and Rhonda Thomas submitted PPP and EIDL applications claiming 16 employees and gross revenues of $1.73 million for a company with no employees, revenue or payroll, and loans of $510,000 were approved. The release states Bennett also submitted 74 unemployment insurance claims in other individuals' names to the Pennsylvania Department of Labor, resulting in $425,339 in benefits. A pistol with no serial number was found at Bennett's home in May 2021.

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                                      Department of Justice

                                        U.S. Attorney’s Office

                                        District of New Jersey

FOR IMMEDIATE RELEASE                                                         Tuesday, July 19, 2022



  Camden County Man Admits Defrauding COVID-19 Relief
       Programs and Illegally Possessing Firearm
CAMDEN, N.J. – A Camden County, New Jersey, man today admitted conspiring to fraudulently
obtain COVID-19 relief funds, fraudulently obtaining unemployment benefits, and illegally
possessing a firearm, U.S. Attorney Philip R. Sellinger announced.

Stephen Bennett, 46, of Berlin, New Jersey, pleaded guilty before U.S. District Judge Karen M.
Williams in Camden federal court to an information charging him with one count of bank fraud
conspiracy, one count of wire fraud, and one count of being a felon in possession of a firearm.

According to documents filed in this case and statements made in court:

The Coronavirus Aid, Relief, and Economic Security (CARES) Act is a federal law enacted in March
2020 and was 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 hundreds of billions of dollars in forgivable loans to small
businesses for job retention and certain other expenses, through a program referred to as the
Paycheck Protection Program (PPP). The CARES Act also authorized the Small Business
Administration to provide Economic Injury Disaster Loans (EIDLs) of up to $2 million to eligible
small businesses that were experiencing substantial financial disruption due to the COVID-19
pandemic.

To obtain a PPP or EIDL loan, a qualifying small business was required to apply and provide
information on its operations, including the number of employees and expenses. In addition,
businesses generally had to provide supporting documentation.

The CARES Act also created a new temporary federal unemployment insurance program called
Pandemic Unemployment Assistance (PUA), which provided unemployment insurance benefits for
individuals who were not eligible for other types of unemployment (the self-employed, independent
contractors, gig economy workers). The CARES Act also created a new temporary federal program
called Federal Pandemic Unemployment Assistance (FPUC) that provided an additional $600
weekly benefit to those eligible for PUA and regular unemployment insurance benefits.

In 2020, Bennett conspired with Rhonda Thomas to submit one PPP application and one EIDL
application for a company controlled by Bennett. The applications stated that the company had 16
employees, gross revenues of $1.73 million, and an average monthly payroll of $144,000, when in
fact the company had no employees, revenue, or payroll. Bennett and Thomas also submitted forged
tax forms and altered bank statements as part of the PPP loan application. Based on the
misrepresentations, the loans were approved in the amount of $510,000. Bennett paid kickbacks of
over $150,000 to Thomas and used the rest of the fraudulently obtained PPP and EIDL loan
proceeds to pay for personal expenses, including jewelry and vehicles.
Also in 2020, Bennett defrauded the Pennsylvania Department of Labor by submitting 74
unemployment insurance claims in the names of other individuals. Bennett falsely stated on that the
applicants were self-employed and unemployed because of COVID-19. Benefits of $425,339 were
paid to Bennett as a result of the fraudulent claims he submitted.

In May 2021, law enforcement officials executing a search warrant at Bennett’s home found a .9
millimeter semiautomatic pistol with no serial number (commonly referred to as a “ghost gun”) and
a magazine loaded with 16 rounds of ammunition.

The charge of bank fraud conspiracy carries a maximum penalty of 30 years in prison and a fine of $1
million. The count of wire fraud is punishable by a maximum of 20 years in prison and a $250,000
fine, or twice the gross gain or loss from the offense. The count of being a felon in possession of a
firearm carries a maximum of 10 years in prison and a $250,000 fine. Sentencing is scheduled for
Nov. 21, 2022.

Thomas previously pleaded guilty to bank fraud conspiracy and money laundering and is awaiting
sentencing.

U.S. Attorney Sellinger credited special agents of the Federal Deposit Insurance Corporation – Office
of the Inspector General, under the direction of Patricia Tarasca, Special Agent-in-Charge, New York
Regional Office; special agents of the Social Security Administration, Office of Inspector General,
New York Field Division, under the direction of Special Agent in Charge Sharon MacDermott; special
agents of the FBI’s South Jersey Resident Agency, under the direction of Special Agent in Charge
Jacqueline Maguire in Philadelphia, special agents of the U.S. Department of Labor, Office of the
Inspector General, New York Region, under the direction of Special Agent in Charge Jonathan
Mellone, with the investigation leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorney Daniel A. Friedman of the U.S. Attorney’s
Office’s Criminal Division in Camden and Senior Litigation Counsel Jason M. Richardson of the U.S.
Attorney’s Office Civil Rights Division in Camden.
Attachment(s):
Download Bennett.Information.pdf
Topic(s):
Coronavirus
Firearms Offenses
Component(s):
USAO - New Jersey
Press Release Number:
22-271
                                                                                  Updated July 19, 2022


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