Somerset County man admits $850,000 paycheck protection fraud scheme | USAO-NJ

TRENTON, NJ – A Somerset County, New Jersey man admitted fraudulently receiving over $850,000 in Federal Paycheck Protection Program (PPP) loans, U.S. Attorney Philip R. Sellinger announced today.

Butherde Darius, 50, of North Plainfield, New Jersey, pleaded guilty to one count of conspiracy to commit bank fraud and one count to United States District Judge Peter G. Sheridan in Trenton Federal Court on November 21, 2022 money laundering charges.

According to the documents and testimonies filed in court in this case:

Darius has conspired with at least one person to submit a fraudulent PPP loan application to a lender on behalf of a company he claims to control and receive over $850,000 in the process. He engaged in various financial transactions with the fraudulently obtained loan proceeds. The filing, filed by Darius and his conspirator, contained fraudulent allegations against the lender — a member of the Federal Home Loan Bank — and the SBA, including fake federal tax documents purportedly from the IRS. Darius also fabricated the existence of employees and wages paid by the alleged businesses. However, none of the alleged tax documents filed in support of the loan applications were ever filed with the IRS, according to IRS records. The Darius loan application for his alleged business was approved for approximately $852,000 in federal COVID-19 emergency relief funds earmarked for ailing small businesses. Darius then used a portion of the proceeds for various personal expenses.

The charge of conspiracy to commit bank fraud carries a maximum sentence of 30 years in prison and a $1 million fine. The money laundering charge carries a maximum sentence of 10 years in prison and a maximum fine of $250,000. The verdict is scheduled for March 6, 2023.

US Attorney Sellinger attributed special agents to the IRS – Criminal Investigation led by Acting Special Agent Tammy L. Tomlins; Social Security Administration Special Agents, Office of Inspector General, led by Special Agent in Charge Sharon MacDermott; Special Agents for the United States Attorney for the District of New Jersey, led by Special Agent in Charge Thomas Mahoney; Postal Inspectors of the US Postal Inspection Service in Newark under the direction of Acting Inspector in Charge Raimundo Marrero, Philadelphia Division; Federal Housing Finance Agency Special Agents, Office of Inspector General, led by Special Agent in Charge Robert Manchak; Special Agents of the Board of Governors of the Federal Reserve System Consumer Financial Protection Bureau, Office of Inspector General, under the direction of Acting Special Agent in Charge Stephen Donnelly; Federal Deposit Insurance Corporation Special Agents – Office of Inspector General, under the direction of Special Agent in Charge Patricia Tarasca in New York; and Department of Homeland Security special agents, Homeland Security Investigations, led by Special Agent in Charge Ricky J. Patel in Newark, which investigation resulted in the guilty plea.

The government is being represented by Assistant US Attorneys David E. Dauenheimer and Katherine M. Romano of the US Attorney’s Office’s Healthcare Fraud Division in Newark.

Anyone with information about suspected fraud related to COVID-19 may report it by calling the Department of Justice’s National Center for Disaster Fraud hotline at 866-720-5721 or the NCDF web complaint form at: https:/ /www.justice. gov/disaster-fraud/ncdf-disaster-complaint-form.