Former Baltimore City Council candidate Nichelle Henson was found guilty by a federal jury of bank fraud and making false statements to obtain nearly $1.7 million in loans earmarked for pandemic relief. The conviction comes after a weeklong trial, as announced by the U.S. Attorney's Office, District of Maryland.
Henson's scheme involved submitting fraudulent applications for Economic Injury Disaster Loans (EIDL) and Paycheck Protection Program (PPP) loans using various businesses she had incorporated with the State of Maryland. Despite claiming operational statuses and multiple employees, these businesses were non-functioning and employee-less at the time of application. In the process, Henson received $18,000 from the Small Business Administration (SBA) and later obtained $998,590 from six PPP applications, according to information released by the Department of Justice.
The trial detailed how Henson submitted a dozen fraudulent PPP loan applications to three SBA-approved lenders, supporting her claims with falsified IRS tax forms. Infamously, one of her entities was a campaign to fund her bid for the city council—a candidacy she had withdrawn from months prior to the application—and another was a nonexistent construction business supposedly located at a vacant lot. Her ploy also included fabricating utility bills to support loan applications.
M&T Bank funded five out of six of Henson's additional fraudulent loan applications, depositing a staggering $676,250 into her accounts. However, they quickly froze the accounts and alerted law enforcement upon suspecting fraud. The money Henson received was used to support various non-related business ventures, including funding a used car dealership and creating a cryptocurrency called Subina Coin.
Henson now faces up to 30 years in federal prison for each count of bank fraud and up to 5 years for each count of false statements. Sentencing is set for August 5, with U.S. District Judge Matthew J. Maddox presiding. As a part of her sentence, Henson must pay restitution to the SBA and the financial institutions victimized by her acts. The conviction was a result of the collaborative efforts of the FBI and the Office of the Special Inspector General for Pandemic Recovery, as highlighted by U.S. Attorney Kelly O. Hayes.
