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SHREVEPORT, La. – Businesswoman Pleads Guilty in CARES Act Fraud Scheme
Janola Massaquoi, 41, of Shreveport, Louisiana, pleaded guilty on an unspecified date before Chief United States District Judge S. Maurice Hicks, Jr. to making false statements to a federal agency.
Massaquoi, a businesswoman from Shreveport, formed the Jane Elizabeth Education Group (JEEG) in 2018 and also served as the president of a beauty career training company. In 2020, Massaquoi applied to the SBA for an Economic Injury Disaster Loan (EIDL) in the name of JEEG d/b/a Company 1 seeking approximately $500,000 in EIDL Program funds. At the same time, she applied for a Paycheck Protection Program (PPP) loan in the name of JEEG d/b/a Company 1 seeking $178,750.
As part of the EIDL application process, Massaquoi electronically submitted to the SBA a Loan Authorization and Agreement in which she certified to the SBA that “[JEEG] will not, without the prior written consent of SBA, make any distribution of Borrower’s assets, or give any preferential treatment, make any advance, directly or indirectly, by way of loan, gift, bonus, or otherwise to any owner or partner…” Massaquoi also certified that the loan funds would be used solely as working capital for JEEG.
Both loan applications were subsequently approved. Based on Massaquoi’s material misrepresentations set forth in the false Loan Authorization and Agreement, the SBA disbursed approximately $500,000 in EIDL benefits to a bank account held by Company 1. On April 23, 2020, approximately $178,750 in PPP loan benefits were disbursed to a bank account held by Company 1.
In reality and unbeknownst to the SBA, Massaquoi intended to make a large advance directly to herself and did not intend to use the EIDL funds solely as working capital for JEEG. After obtaining the loan benefits, Massaquoi transferred funds from Company 1’s bank account to other bank accounts she personally controlled and used the funds for a variety of personal expenses including a down payment on the purchase of a personal residence and mortgage payments. Massaquoi also withdrew over $30,000 in cash, transferred over $50,000 to friends and family members, and used approximately $83,000 to fund her personal investment and retirement accounts. In total, Massaquoi used $250,000 of the EIDL proceeds for her personal use.
“This defendant took advantage of taxpayer dollars at one of the most vulnerable times in American history,” stated U.S. Attorney Brandon B. Brown. “Over the last few years, small businesses have struggled to survive during the pandemic. Massaquoi exploited an opportunity given by the government to provide legitimate financial assistance to said businesses. Individuals who commit such fraud will be investigated and ultimately prosecuted. We will continue to work with our federal partners who have allocated their investigative resources toward combating this type of fraud.”
Massaquoi faces a sentence of not more than 5 years in prison, 3 years of supervised release, and a fine of up to $250,000. Sentencing has been set for January 11, 2023.
Key Facts
- State: Louisiana
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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