Marietta man charged in massive PPP fraud scheme | USAO-NDGA

ATLANTA — Carl Delano Torjagbo, aka Karl Lucius Delano, has been arrested on federal bank fraud and money laundering charges stemming from a scheme to defraud a bank out of a $9.5 million loan from the Protection Program paychecks (“PPP”) in the name of a fictitious company and then allegedly used the proceeds of the loan to improve his personal lifestyle. PPP is a federal loan program to help small businesses survive the COVID-19 pandemic by providing funds to cover certain payroll costs, including benefits, mortgage interest, rent and utilities. public.

“This defendant allegedly stole millions of taxpayer dollars intended to help small businesses stay afloat during the pandemic,” U.S. Attorney Ryan K. Buchanan said. “We will continue to investigate and charge anyone who fraudulently obtains these critical funds and uses them for their own personal gain.”

“The FBI and our partners will not tolerate anyone diverting federal emergency aid to businesses that really need it to stay operational,” said Keri Farley, FBI Atlanta Special Agent in Charge. “Torjagbo’s fraud was particularly egregious, and we will make sure he is held accountable accordingly.

“The Treasury Inspector General for Tax Administration aggressively pursues those who attempt to defraud programs provided to the American people under the CARES Act,” said J. Russell George, Treasury Inspector General for Tax Administration. tax administration (TIGTA). “We appreciate the efforts of the Department of Justice and our law enforcement partners in this effort.”

According to U.S. Attorney Buchanan, the charges and other information presented to the court: On February 16, 2021, Torjagbo signed a PPP loan application on behalf of Kremkov Industries LLC and submitted it to a bank, requesting a PPP loan from an amount of $9,554,425.00. . To be eligible for a PPP loan, a company had to be in operation on February 15, 2020. Kremkov Industries was not eligible for a PPP loan because it was not in operation on February 15, 2020. In fact, it was not not even created until about ten months after the expiration of that period.

Torjagbo swore that the information he provided in the PPP loan application and in all supporting documents and forms was “truthful and accurate in all respects”. Torjagbo certified that Kremkov Industries was in operation on February 15, 2020. Torjagbo said Kremkov Industries had 493 employees. Torjagbo also said Kremkov Industries had an average monthly payroll of $3,821,770. All of these statements were allegedly false.

In support of the PPP loan application, Torjagbo allegedly submitted fraudulent documents to the bank, including false tax returns (IRS forms 940, 941 and 1040) and false reports that listed names and payroll information. fictitious of the 493 people who worked for Kremkov Industries.

On March 29, 2021, as a result of Torjagbo’s alleged false and fraudulent misrepresentations, the bank transferred $9,554,425.00 of the PPP loan proceeds into the custody and control of Torjagbo. Proceeds from the PPP loan were initially deposited in a bank account titled in the name of Kremkov Industries. Immediately prior to this deposit, the balance in this account was only $105.

In the PPP loan application, Torjagbo certified that all loan proceeds would be used for business purposes only, as specified in the loan application and in accordance with Paycheck Protection Program rules. Torjagbo acknowledged that he could be sued if PPP loan proceeds were knowingly used for unauthorized purposes.

On April 8, 2021, Torjagbo had $3 million of the PPP loan proceeds transferred by check from the bank to another bank. On this check, Torjagbo wrote a note stating that it was for “payroll”. But these funds were not used to pay the “wage bill”. Instead, these funds would have been used to pay Torjagbo’s personal debts and expenses, including the following:

• $1,677,861.01 for his personal residence;

• more than $837,000 for semi-trailers to start a new trucking business;

• approximately $300,000 for the purchase of other real estate;

• $118,299.79 for a 2022 BMW M850XL;

• $87,020 for a 2021 Land Rover Velar; and

• more than $15,000 for plastic surgery.

PPP is a federal loan program to help small businesses survive the COVID-19 pandemic by providing funds to cover certain payroll costs, including benefits, mortgage interest, rent and utilities. public.

Carl Delano Torjagbo, aka Karl Lucius Delano, 42, of Marietta, Georgia, was arraigned before U.S. Magistrate Linda T. Walker, on federal charges of bank fraud and money laundering, and taken into custody on sight. Torjagbo was indicted by a federal grand jury on May 10, 2022. The public is reminded that the indictment contains charges only. The accused is presumed innocent of the charges and the onus will be on the government to prove the accused’s guilt beyond a reasonable doubt at trial.

This case is being investigated by the Federal Bureau of Investigation, the United States Treasury Inspector General for Tax Administration, and the Internal Revenue Service Criminal Investigation. Additionally, the Federal Motor Carrier Safety Administration and the Paulding County Sheriff’s Office provided valuable assistance in the investigation.

Assistant U.S. Attorney Russell Phillips is prosecuting the case.

On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to mobilize Department of Justice resources in partnership with government agencies to scale up enforcement and prevention efforts. pandemic-related fraud. The task force strengthens efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies administering relief programs to prevent fraud, among other methods, by increasing and integrating coordination mechanisms existing ones, identifying resources and techniques to uncover fraudulent actors and their agendas, and sharing and leveraging information and knowledge gained from previous enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus

Anyone with information about alleged attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via NCDF’s online complaint form at: https://www. .justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

For more information, please contact the US Attorney’s Office of Public Affairs at [email protected] or (404) 581-6016. The Internet address for the United States Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.

About Teresa G. Wilson

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