FBI charges $1.2m Central Florida couple with bogus PPP loans
A Florida couple are accused of obtaining at least a dozen fraudulent loans worth more than $1.2 million to manipulate a government program to help small businesses during the pandemic, according to new court documents .
Pretending to be long-time business owners, Level and Rachelle Harris received the money between May 2020 and April 2021 and bought two homes in central Florida, according to documents filed by the US government as it seeks to seize the Apopka and St. Cloud properties.
the Paycheck Protection Program (PPP) was born from the CARES Act and provided more than $600 billion in loans to help small businesses survive economic hardship during the coronavirus pandemic. Forgivable loans were supposed to keep businesses going and employees on the payroll. But without sufficient oversight and government resources, the situation was ripe for fraud. The government has investigated several people who posed as business owners, lied about their business finances in their loan application or used the funds to live lavishly.
For the Harrises, their scheme began when they applied for loans “on behalf of six companies of the same name from at least seven lenders,” according to federal court documents.
All the different companies sounded the same.
One loan request was for Harris Faith Investments. Another, HFI Harris Faith Investment. And Levelle Harris Faith Investments. And Rachel Harris Faith Investments. Other trade names were simply called Levelle Harris or Rachel Harris.
“Of these businesses, only Harris Faith Investments, LLC is an incorporated business,” court documents said. “Additionally, some of the apps list the exact same employees, although the apps are for different companies.”
What caught Levelle Harris on the FBI’s radar was a complaint from one of the lenders he applied for several loans from, but was turned down.
Each time an application was denied, it requested another, changing information, such as a different social security number or EIN.
During the federal investigation, it appears authorities had no trouble finding flaws in the Harris claims.
The business addresses for their applications either did not exist or were located in one-story houses that appeared unlikely to be a business where 10 people worked as the Harrises claimed and had no apparent connection to the couple.
The Harris Faith Investments website touted the organization launched in 2011 to help small businesses get financing. Federal authorities noticed that the website’s copyright date was 2020. Today, the website appears to no longer work.
Authorities said there was no evidence that Harris Faith Investments was a real business and was generating income. The Harrises submitted either fake Social Security numbers or numbers that did not match their “employees” on the loan applications.
And upon request, Harris submitted what appeared to be an amended letter from the IRS. The Employer Identification Number (EIN) and date of the letter were written in a different font than everything else.
“Finally, all but one of the funds from the loans were deposited into the same bank account, and not into multiple business accounts as one would expect from separate, legitimate businesses,” it said. court documents.
The couple got 12 loans ranging from nearly $21,000 to $142,000 each.
Between March 2021 and August 2021, Harris used money from his PNC checking account to buy a car and $40,000 in real estate, court records show.
“The overwhelming majority of deposits came from fraudulently obtained PPP loans. There do not appear to be any deposits from gainful employment or business income. Indeed, Florida salary and income records for Harris showed that in 2019 he received salaries from a real estate company totaling $16,078.30. In 2020 and 2021, Harris’ salary was $763.75. Harris’ wife has not had a salary since 2018,” the court filing said.
In U.S. District Court, the government filed documents to seize two homes — 3124 Cherokee Road in St. Cloud and 2132 Majestic Woods Blvd. to Apopka – which authorities say were bought mostly with money linked to wire fraud through bogus loans. The St. Cloud home was owned by Harris Faith Investments, while Levelle Harris’ name appeared on title to the Apopka property.
The government investigated PPP fraud, which led to at least 122 people being charged with a crime, the US Department of Justice said in March 2021.
“The cases involve a range of conduct, from individual business owners who inflated their payroll expenses to obtain larger loans they otherwise would not have qualified for, to serial fraudsters who revived dormant companies and purchased fictitious companies with no real operations to apply for multiple loans falsely claiming they had a large payroll, to organized criminal networks submitting identical loan applications and supporting documents under the names of different companies,’ the press release from the DOJ. “Most of the defendants diverted loan proceeds for prohibited purposes, such as buying homes, cars, jewelry and other luxury items.”