Owner of Central PA Aluminum Company Charged for $11.5M Worth of COVID-19 Fraud

SEATTLE (Scrap Monster): The United States Attorney’s Office for the Middle District of Pennsylvania announced that Creed White, age 65, of Freeland, Maryland, was charged in a criminal information with conspiracy to commit wire fraud and engaging in an unlawful monetary transaction.

According to United States Attorney Gerard M. Karam, the information alleges that White owned Aluminum Alloys MFG, LLC, an aluminum smelting and processing business located in Yoe, York County, Pennsylvania, and additionally owned or controlled 18 other sham corporate entities that did not have any employees or business operations. The information alleges that White, conspiring with others, including several of his employees, filed more than 120 applications on behalf of White’s non-operational businesses for pandemic stimulus funds, including under the Payment Protection Program (PPP) and the Economic Injury and Disaster Loan (EIDL) program.  The information alleges that 42 of these loan applications were approved and funded with more than $11.5 million into bank accounts that White controlled. 

The information also alleges that the applications White and his co-conspirators filed contained numerous material misrepresentations about who controlled and operated the non-operational businesses.  It is alleged that the PPP and EIDL applications included fraudulent supporting documentation, including false information about the number of employees who purportedly worked at the non-operational businesses, fabricated bank records and financial statements, forged and falsified IRS documents, and material misrepresentations regarding wages paid, taxes withheld and paid, gross receipts, and other expenses allegedly incurred by the applicant businesses. 

White and his co-conspirators allegedly obtained more than $11.5 million in PPP and EIDL funds through filing the fraudulent applications.  It is also alleged that White misused the loan proceeds to make unauthorized expenditures for his benefit and the benefit of his businesses.

“Fraudulently obtaining over $11.5 million in federal pandemic relief funds that are meant to provide assistance to eligible small businesses will not be tolerated as shown by today’s charging of Defendant White,” said U.S. Attorney Karam.  “My office will continue to diligently work with our law enforcement partners to pursue fraud against federal relief programs.”  

“Individuals making false statements to fraudulently obtain pandemic funds for personal gain will face justice,” said SBA OIG’s Eastern Region Special Agent in Charge Amaleka McCall-Brathwaite. “Our Office will remain relentless in the pursuit of fraudsters who seek to exploit SBA’s vital economic programs. I want to thank the U.S. Attorney’s Office and our law enforcement partners for their dedication and commitment to seeing justice served.”

“The charges announced today show IRS-CI’s ongoing commitment to defend the integrity of the pandemic relief programs,” said Yury Kruty, Special Agent in Charge of IRS-Criminal Investigation.  “IRS-CI along with our law enforcement partners will continue to aggressively investigate those who schemed to defraud these programs that were intended to help struggling individuals and businesses.”

“Treasury OIG is working closely with its law enforcement partners to investigate and prosecute criminals who cheat and steal funds meant to help individuals and businesses harmed by the pandemic,” said Rich Delmar, Treasury Deputy Inspector General. 

The PPP and EIDL programs, both funded by the March 2020 CARES Act, were designed to help small businesses facing financial difficulties during the COVID-19 pandemic.  PPP funds were offered in forgivable loans, provided that certain criteria are met, including use of the funds for employee payroll, mortgage interest, lease, and utilities expenses.  EIDL funds are offered in low-interest rate loans, designated for specific business expenses, such as fixed debts, payroll, and business obligations. 

Courtesy: www.tristatealert.com