WASHINGTON–Several new prosecutions related to fraud against the Paycheck Protection Program have been announced, including one high-profile case in which funds were used to buy a $300,000 Lamborghini.
The FDIC’s Office of the Inspector General (OIG) said Shashank Rai, 30, of Beaumont, Texas, has entered a guilty plea to one count of making false statements to a bank related to charges he filed fraudulent applications seeking more than $10 million in forgivable loans through the PPP. Rai, an engineer, was originally charged on May 13, 2020, with violations of wire fraud, bank fraud, false statements to a financial institution, and false statements to the SBA.
A statement from the Justice Department said that as part of his guilty plea Rai admitted he sought millions of dollars in forgivable loans guaranteed by the SBA from two different banks by claiming to have 250 employees earning wages. In fact, no employees worked for his purported business, the Justice Dept. said.
In the second application, Rai sought approximately $3 million in PPP loan proceeds by fraudulently claiming to have 250 employees with an average monthly payroll of approximately $1.2 million.”
More Than 100 Defendants Named
Meanwhile, in Miami, the Office of Inspector General said David T. Hines, 29, has entered a guilty plea to one count of wire fraud related to fraudulently obtaining approximately $3.9 million in PPP loans with some of the proceeds going toward the purchase of a $318,000 Lamborghini.
The OIG reported the Justice Department has prosecuted more than 100 defendants in more than 70 criminal cases related to fraudulent use of the PPP, and that more than $60 million in cash proceeds derived from fraudulently obtained PPP funds, as well as numerous real estate properties and luxury items purchased with such proceeds, have been seized.