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SBA Insider Accused of PPP & EIDL Fraud
MIAMI, FL – A former Small Business Administration (SBA) employee is facing federal charges after allegedly exploiting the COVID-19 relief programs for personal gain. Malaina Chapman, 37, of Hialeah, Florida, was charged today with conspiracy to commit wire fraud, wire fraud, and bank fraud, according to a release from the Department of Justice.
Chapman, who worked as a Disaster Relief Specialist for the SBA from September 28, 2020, until her resignation on March 18, 2021, is accused of participating in multiple schemes to defraud the Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL) program. She’s also alleged to have targeted local credit unions and state-level rental assistance programs designed to help those struggling during the pandemic.
“Disaster relief was intended for people in need, namely functioning businesses, corporate forms, and sole proprietorships facing uphill prospects during the pandemic, not for those who sought to pad their pockets and defraud the government by making up entities or overstating their payroll and revenues to qualify for the relief,” stated U.S. Attorney Markenzy Lapointe for the Southern District of Florida. “We will continue to hold anyone accountable who exploits and defrauds financial institutions and the government’s pandemic response to enrich themselves at the expense of struggling businesses, employees, and local tenants. While the COVID-19 relief programs have ended, our commitment to identifying and prosecuting those who defrauded them has not.”
The criminal complaint details specific instances of alleged fraud. On February 10, 2021, while still employed by the SBA, Chapman allegedly submitted a loan application for “Upscale Credit Lounge” to Lender 3, supporting it with a falsified 2020 Schedule C form claiming $103,674 in gross revenues. This led to the approval of a $17,052.50 loan. Similarly, on February 19, 2021, she allegedly submitted a PPP loan application for “DA TRAP,” falsely claiming four employees and a $14,191 average monthly payroll, backed by fraudulent IRS Form 941 documents. This resulted in a $35,477.50 loan approval.
Federal investigators also allege Chapman conspired with others, notably Raisha Kelly, who is accused of leading a larger scheme to submit fraudulent PPP loan applications. Chapman allegedly created and provided Kelly with false IRS documents used in these applications. Kelly and others are charged in Case No. 24-CR-20079. Chapman is also facing charges related to defrauding programs offered by the State of Florida.
“Today’s charges highlight our unwavering commitment to protecting the integrity of SBA programs,” said SBA OIG’s Eastern Region Special Agent in Charge Amaleka McCall-Braithwaite. “Exploiting relief efforts for personal gain undermines public trust and deprives legitimate businesses of essential assistance.” The investigation is ongoing, and Chapman’s initial appearance in Miami federal court has already taken place. The full extent of the alleged fraud remains under scrutiny.
RELATED: Oshkosh Woman Accused of $1.6M Credit Union Heist
Key Facts
- State: Florida
- Agency: DOJ USAO
- Category: White Collar Crime
- Source: Official Source ↗
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