The United States Department of Justice has charged two Illinois businessmen for allegedly fraudulently obtaining more than $7.8 million in small business loans meant to provide financial aid during the COVID-19 pandemic. The accused, Sharhabeel Shreiteh and Tracy Mitchell, were indicted for their involvement in a scheme related to the federal Paycheck Protection Program (PPP) loans mandated under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, according to Department of Justice.
The PPP loans were established to help businesses navigate through the unprecedented economic turmoil brought about by the global pandemic. The loans provided financial relief by allowing interest and principal to be forgiven if a certain percentage of the funds were spent on essential expenses such as payroll and rent. However, Shreiteh and Mitchell allegedly exploited the system and devised a plot to fraudulently obtain millions.
Details of the indictment reveal that the duo recruited purported sole proprietors, self-employed individuals, and businesses to provide personal identifying information, bank statements, and other documents. They then submitted fraudulent PPP loan applications on their behalf, containing numerous inflated figures and false statements, according to the Department of Justice. In return, Shreiteh and Mitchell received between $1,000 and $4,000 per successful loan application.
Shreiteh, 43, faces 13 counts of wire fraud, while 49-year-old Mitchell faces ten counts. Mitchell has already pleaded not guilty in federal court, and Shreiteh's arraignment is still pending. The potential consequences of their actions, for both Shreiteh and Mitchell, are a sentence of up to 20 years in federal prison if they are convicted.
For those who might have knowledge about attempted COVID-19 fraud, the Department of Justice has encouraged reporting the information to the National Center for Disaster Fraud by calling 866-720-5721 or by filing an online complaint at their website.
