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Atlanta Journal – PPP Loan Scam Brought Down by Feds
ATLANTA — A group of scammers netted $5.5 million in a brazen Paycheck Protection Program (PPP) loan scheme orchestrated by Darrell Thomas, a Duluth, Georgia resident. The scheme involved 14 businesses located in seven different states.
Thomas and his team applied for fraudulent PPP loans on behalf of the businesses, claiming they had between 59 and 69 employees and attaching forged IRS tax forms and fake bank statements or payroll expense spreadsheets. In reality, none of the businesses had employees or payroll expenses. The loan proceeds were used to purchase luxury vehicles, jewelry, and pay for personal expenses.
As a result of the investigation, the United States seized nearly $4 million in PPP funds, and six participants in the scheme, including Thomas, have pleaded guilty.
The U.S. Attorney’s Office for the Northern District of Georgia has charged dozens of people with federal crimes related to PPP fraud, including bank fraud, conspiracy, and money laundering. The cases involve a variety of criminal conduct, including business owners who inflated their payroll expenses to obtain larger loans than they otherwise would have qualified for.
“Along with our federal, state and local law enforcement partners, we continue to remain focused on investigating and prosecuting crimes involving PPP fraud,” said Acting U.S. Attorney Kurt R. Erskine. “Unfortunately, when criminals steal these funds, they take them out of the hands of those suffering financial hardship. Criminals should understand that the diversion of taxpayer money meant to help small businesses survive this crisis will be fully investigated and prosecuted.”
The PPP fraud cases prosecuted by The U.S. Attorney’s Office for the Northern District of Georgia include United States v. Darrell Thomas, et al., in which 22 defendants were charged in an $11.1 million PPP loan fraud scheme.
Another case, U.S. v. Rodericque Jarmaine Thompson, et al., involves nine individuals who pleaded guilty to various federal charges arising from multiple bank-fraud conspiracies designed to obtain PPP loans under false pretenses. In this scheme, the business owners agreed to kickback up to 50 percent of the loan amount to Thompson, as a fee for helping them obtain the loans.
“Criminals should understand that the diversion of taxpayer money meant to help small businesses survive this crisis will be fully investigated and prosecuted,” said Erskine.
Key Facts
- State: Georgia
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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