Homeowners Of Grand Rapids Trucking Firm Plead Responsible To Financial institution Fraud Conspiracy, Pay $1,000,000 In Associated Civil Case, In Connection With Covid-19 Aid Fraud | USAO-WDMI

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DMR Transportation Falsified Monetary Data To Obtain A Second-Draw Mortgage Underneath The Paycheck Safety Program

          GRAND RAPIDS, MICHIGAN — Semsi Salja and Anes Suhonjic, the house owners of Grand Rapids-based trucking firm DMR Transportation (“DMR”), pleaded responsible in federal court docket at this time to conspiring to commit financial institution fraud in reference to a $290,855.00 mortgage underneath the Paycheck Safety Program (“PPP”). In a associated civil case, DMR, Salja, and Suhonjic agreed to pay a complete of $1,000,000.00, together with a considerable civil financial penalty underneath the Monetary Establishments Reform, Restoration, and Enforcement Act (“FIRREA”).

          In 2020, Congress enacted the Coronavirus Support, Aid, and Financial Safety Act (the “CARES Act”) to supply emergency federal help to the thousands and thousands of People affected by the financial results of the COVID-19 pandemic.  Via the PPP, the CARES Act approved forgivable loans to small companies for job retention and sure different bills.  In December 2020, Congress enacted the Financial Support to Onerous-Hit Small Companies Act, which reopened the PPP to first-time debtors and, topic to stricter limitations and situations, approved second-draw PPP loans to debtors that beforehand obtained a PPP mortgage.  Debtors had been eligible for second-draw PPP loans if, amongst different issues, they skilled a income discount of 25% or higher in 2020 relative to 2019.

          In its second-draw PPP mortgage software, DMR knowingly and falsely licensed that it realized the required 25% discount in gross receipts between the second monetary quarter of 2019 and the second monetary quarter of 2020.   DMR additionally submitted falsified quarterly steadiness sheets and different false monetary data that had been signed by Salja and Suhonjic alongside the appliance.  In September 2021, DMR sought forgiveness of its second-draw PPP mortgage by falsely certifying that its second-draw PPP mortgage proceeds had been used to pay eligible enterprise bills when, in truth, DMR held that cash in reserve. 

          “The PPP concerned a restricted pool of funds to assist small companies wracked by the disruption of a worldwide pandemic,” United States Lawyer Mark Totten mentioned.  “By fraudulently acquiring a second PPP mortgage, DMR took, for itself, a whole bunch of 1000’s of {dollars} that would have been used to assist deserving firms.  My workplace will proceed to aggressively examine and prosecute these circumstances.”

          “By illegally taking extra cash from the Paycheck Safety Program, these defendants harmed the house owners and workers of small companies struggling by way of the pandemic,” mentioned James A. Tarasca, Particular Agent in Cost of the FBI in Michigan. “The FBI is dedicated to working with our regulation enforcement companions to research and maintain accountable anybody making the most of a worldwide pandemic to line their very own pockets.”

          “At this time’s responsible plea and FIRREA civil penalties maintain the defendants accountable for their roles in fraudulently acquiring a second mortgage underneath a federal aid program created to help small companies who had been struggling because of the pandemic,” mentioned Particular Agent in Cost Kathy A. Enstrom of the Federal Deposit Insurance coverage Company Workplace of Inspector Common (FDIC-OIG). “The FDIC-OIG stays dedicated to working with our regulation enforcement companions to carry these accountable who search to abuse such applications and undermine the integrity of our Nation’s banks.”

          Salja and Suhonjic face a most of 5 years in jail.  United States District Decide Jane M. Beckering will decide their sentences after contemplating the U.S. Sentencing Tips and different statutory components.

          The civil settlement consists of the decision of claims introduced underneath the whistleblower provisions of the False Claims Act.  Underneath these statutory provisions, a non-public get together can file an motion on behalf of the US and obtain a portion of the settlement or judgment proceeds.  The whistleblower case is captioned, United States ex rel DePouw v. DMR Transportation, et al., No. 1:21-cv-548 (W.D. Mich.).

          Assistant U.S. Attorneys Davin M. Reust and Adam B. Townshend represented the US.  The Federal Deposit Insurance coverage Company’s Workplace of Inspector Common and the FBI investigated the case.

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