Baltimore, Maryland – Dana Lamar Antonio Hayes, Jr., age 37, of Baltimore, Maryland, pleaded responsible immediately to a federal wire fraud cost associated to a scheme to acquire a fraudulent Financial Harm Catastrophe Reduction mortgage software (EIDL mortgage) and a number of other Paycheck Safety Plan mortgage functions (PPP loans), beneath the Coronavirus Assist, Reduction, and Financial Safety (CARES) Act, from two monetary establishments (Bank1 and Financial institution 2).
The responsible plea was introduced by United States Legal professional for the District of Maryland Erek L. Barron; Particular Agent in Cost Thomas J. Sobocinski of the Federal Bureau of Investigation, Baltimore Discipline Workplace; and Particular Agent in Cost Darrell J. Waldon of the Inside Income Service – Felony Investigation, Washington, D.C. Discipline Workplace.
In accordance with his plea settlement, between March 2020 and October 2021, Hayes submitted a fraudulent EIDL mortgage software and PPP mortgage functions to the Small Enterprise Administration (SBA) and two monetary establishments (Bank1 and Financial institution 2).
Particularly, in March 2020, Hayes submitted a fraudulent EIDL mortgage software on behalf of his beforehand forfeited and just lately revived firm, D&L Funding Properties Inc. The EIDL mortgage software contained false statements relating to the variety of D&L staff and the payroll bills of D&L. As well as, the appliance requested: “For any prison offense…have you ever ever been convicted plead responsible, plead nolo contendere, been positioned on pretrial diversion, or been positioned on any type of parole or probation (together with probation earlier than judgment)?” Hayes answered “No,” despite the fact that Hayes knew that, on April 30, 2019, Hayes was positioned on probation for a firearm offense, particularly for possession of a stolen firearm. Hayes additionally claimed to have firm bills of $15,000 and tools prices of $35,000, when in actual fact, the corporate had been inactive since 2019.
The SBA initially denied Hayes’ EIDL software, and for the following 18 months, Hayes recurrently contacted the SBA to have his EIDL software permitted. On the idea of false and fraudulent info, the SBA finally permitted Hayes’s EIDL software and offered Hayes $15,000 in COVID-19 CARES Act mortgage funds on behalf of D&L. As soon as the funds have been deposited into D&L’s checking account, Hayes transferred all the mortgage proceeds from D&L’s checking account into his private financial savings account.
As detailed within the plea settlement, in June 2020 and January 2021, Hayes utilized for PPP loans with Financial institution 1 and Financial institution 2 on behalf of D&L. In these PPP mortgage functions, Hayes included false statements relating to the variety of staff for his enterprise, falsified tax types, lied about his probation standing, and offered false payroll bills of D&L. On the idea of fraudulent info, Financial institution 1 and Financial institution 2 every permitted a PPP mortgage for D&L, depositing a complete of $35,036, in D&L’s checking account. Hayes shortly transferred the mortgage proceeds into his private financial savings account.
In getting ready the January 2021 PPP mortgage for Financial institution 2, Hayes admitted that he used the identify and Preparer Tax Identification variety of Sufferer 1 to submit a fraudulent tax type to Financial institution 2 with out Sufferer 1’s data or consent. Sufferer 1 had been beforehand employed by Hayes to organize D&L and Hayes’ private tax returns, nevertheless, Sufferer 1 claims that they’ve by no means ready Kind 941’s for D&L, and federal data point out no such type was ever filed. Hayes admitted that he utilized for a second fraudulent PPP mortgage to Financial institution 1 in January 2021, however that mortgage was not permitted.
On November 4, 2021, Hayes utilized on behalf of D&L to Financial institution 1 for PPP mortgage forgiveness for the primary draw mortgage, falsely stating that D&L had spent the whole mortgage quantity, $12,500, on payroll prices. Hayes’s forgiveness software was not permitted.
In February 2022, whereas the alleged COVID-19 reduction scheme was ongoing, Hayes utilized to grow to be the Chief of Fiscal Providers for the Baltimore Metropolis Police Division. Hayes was subsequently employed for the place in April 2022 and terminated shortly thereafter.
“The defendant’s responsible plea ought to mirror our continued resolve to analyze and prosecute those that attempt to exploit a nationwide emergency to steal taxpayer-funded sources by utilizing the worldwide pandemic as a possibility to defraud the US Authorities,” stated Darrell J. Waldon, IRS Felony Investigation Particular Agent in Cost of the Washington D.C. Discipline Workplace. “IRS Particular Brokers are dedicated to working with our regulation enforcement companions to aggressively uncover and disrupt criminals who conspire to abuse these applications for private achieve.”
Hayes faces a most sentence of twenty years in federal jail for wire fraud. Precise sentences for federal crimes are usually lower than the utmost penalties. U.S. District Choose George L. Russell, III has scheduled sentencing for Hayes on April 17, 2023, at 2:00 p.m.
On Could 17, 2021, the Legal professional Basic established the COVID-19 Fraud Enforcement Job Drive to marshal the sources of the Division of Justice in partnership with businesses throughout authorities to reinforce efforts to fight and forestall pandemic-related fraud. The Job Drive bolsters efforts to analyze and prosecute probably the most culpable home and worldwide prison actors and assists businesses tasked with administering reduction applications to stop fraud by, amongst different strategies, augmenting and incorporating present coordination mechanisms, figuring out sources and strategies to uncover fraudulent actors and their schemes, and sharing and harnessing info and insights gained from prior enforcement efforts. For extra info on the Division’s response to the pandemic, please go to https://www.justice.gov/coronavirus.
Anybody with details about allegations of tried fraud involving COVID-19 can report it by calling the Division of Justice’s Nationwide Heart for Catastrophe Fraud (NCDF) Hotline at 866-720-5721 or through the NCDF Internet Grievance Kind at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form. An indictment shouldn’t be a discovering of guilt. A person charged by indictment is presumed harmless except and till confirmed responsible at some later prison proceedings.
United States Legal professional Erek L. Barron counseled the FBI and the IRS- CI for his or her work within the investigation. Mr. Barron thanked Assistant U.S. Legal professional Aaron S.J. Zelinsky, who’s prosecuting the case.
For extra info on the Maryland U.S. Legal professional’s Workplace, its priorities, and sources out there to assist the group, please go to www.justice.gov/usao-md and https://www.justice.gov/usao-md/community-outreach.
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