Seven charged in COVID-Relief fraud scheme totaling $16M

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Seven individuals across two states were charged in an indictment unsealed Nov. 17, 2020, for their alleged participation in a scheme to obtain approximately $16 million in forgivable Paycheck Protection Program (PPP) loans guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

A federal criminal indictment is merely an accusation.  A defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

Among those named are Amir Aqeel, 52, and Pardeep Basra, 51, both of Houston, Texas; Rifat Bajwa, 51, of Richmond, Texas; Mayer Misak, 40, of Cypress, Texas; Mauricio Navia, 41, of Katy, Texas; and Richard Reuth, 57, of Spring, Texas, who are expected to make their initial appearances today before U.S. Magistrate Judge Andrew M. Edison.

They are all charged with alleged conspiracy to commit wire fraud and wire fraud.  The indictment also charges Aqeel with three counts of alleged money laundering.

Also named in the Houston indictment is Siddiq Azeemuddin, 41, of Naperville, Illinois.  He also faces charges of conspiracy to commit wire fraud, wire fraud and money laundering.  Azeemuddin was to appear on Nov. 17, before U.S. Magistrate Judge Heather K. McShain of the Northern District of Illinois.

“These defendants allegedly participated in a scheme to capitalize on the pandemic by filing at least 80 fraudulent PPP applications and enriching themselves by $16 million, spending it on luxury items such as a Porsche and Lamborghini automobiles,” Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division, is quoted saying in the press release

The indictment alleges all conspired to submit more than 80 fraudulent PPP loan applications by falsifying the number of employees and the average monthly payroll expenses of the applicant businesses. In support of these fraudulent loan applications, they allegedly conspired to submit, and did submit, fraudulent bank records and/or fake federal tax forms, according to the charges.  Some of the PPP loan applications were allegedly submitted on behalf of companies the defendants controlled.

Other loan applications were submitted on behalf of entities that third-parties allegedly owned, according to the indictment.  In exchange for these, several of the defendants received large kickbacks, according to the charges.

The indictment further alleges the defendants laundered a portion of the fraudulent proceeds by writing checks from companies that received PPP loans to fake employees.  Those that received checks included some of the defendants and their relatives, according to the charges.  The fake paychecks were then allegedly cashed at Fascare International Inc. dba Almeda Discount Store – a cash checking company Azeemuddin owned.

The indictment alleges that over 1,100 fake paychecks totaling more than $3 million in fraudulent PPP loan proceeds were cashed at Azeemuddin’s business.

Federal agents also executed 45 seizure warrants in conjunction with the case.  Some of items seized included a Porsche and a Lamborghini allegedly purchased with illegally obtained funds.

This is an ongoing investigation said the Justice Department adding that if the public has further information regarding this matter, to contact the Department of Homeland Security at 1-866-DHS-2-ICE.