James Frank Austin, COVID-19 Loan Fraud, Georgia 2023

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COVID-19 Loan Fraud Scandal Rocks Georgia

MACON, Ga. – Two defendants, James Frank Austin, 51, and Rosalend Way, 40, have been sentenced to serve more than five years in prison each for their roles in a wire fraud conspiracy and money laundering scheme to fraudulently obtain COVID-19 relief funds. The funds were used to purchase luxury cars and other personal items.

Austin pleaded guilty to one count of conspiracy to commit wire fraud, two counts of bank fraud, and two counts of money laundering on Aug. 27. He was sentenced to serve 63 months in prison, followed by five years of supervised release, and ordered to pay $2,185,175.72 restitution to the Small Business Administration (SBA). $1,106,499.62 of the restitution is owed jointly and severally with codefendant Way.

Way was found guilty of one count of conspiracy to commit wire fraud and one count of money laundering on Sept. 24, following a three-day trial that began on Sept. 22. She was sentenced to serve 63 months in prison, followed by three years of supervised release, and ordered to pay $1,106,499.62 restitution to the SBA jointly and severally with codefendant Austin.

“Using stolen taxpayer dollars to purchase a Bentley and other luxury goods at a time of national emergency is wrong, pure and simple, and won’t be tolerated in the Middle District of Georgia,” said U.S. Attorney William R. “Will” Keyes. “Our office and our law enforcement partners will hold fraudsters accountable for profiting at the expense of honest and hard-working citizens.”

Austin and Way applied for a Paycheck Protection Program (PPP) loan on behalf of Propel Opportunity Fund, a business established to raise capital through investors and use the funds to conduct pre-development work in underserved neighborhoods. The loan application indicated that Propel had 18 employees with an average monthly payroll of $420,558. However, IRS records showed that the company did not pay any salaries or wages in 2019.

Approximately $500,000 of the loan funds ended up in Way’s bank accounts, which were spent on personal items including dining, retail, gas, groceries, and cash withdrawals. Austin also used $30,000 in funds from another fraudulently obtained PPP loan to pay off Way’s Mercedes-Benz.

The sentences handed down by U.S. District Judge Marc Treadwell serve as a warning to those who would seek to profit from the COVID-19 Economic Relief programs. “The FBI and our law enforcement partners will continue to pursue criminals who cheat federal health programs and profit at the expense of American taxpayers,” said FBI Atlanta Special Agent in Charge Paul Brown.