Houston-area man convicted for role in $35M COVID-19 relief fraud

The investigation was conducted by Homeland Security Investigations (HSI) Houston, the SBA's Office of Inspector General, the Federal Housing Finance Agency's Office of Inspector General (FHFA-OIG), the Federal Deposit Insurance Corporation's Office of Inspector General (FDIC-OIG), and the Treasury Inspector General for Tax Administration (TIGTA).

A federal jury convicted Abdul Fatani, 57, of Richmond, Texas, of one count of conspiracy to commit wire fraud, one count of wire fraud and one count of unlawful monetary transactions (money laundering). He is scheduled to be sentenced on May 8. He faces a maximum penalty of 20 years in prison for conspiracy and wire fraud and 10 years in prison for money laundering. A federal district court judge will determine his sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

According to court documents and evidence presented at trial, Fatani conspired with others to submit fraudulent PPP loan applications by falsifying the number of employees and the average monthly payroll expenses of the applicant businesses. In total, the co-conspirators sought over $35 million through more than 80 fraudulent PPP loans. Fatani distributed over $500,000 in fraudulent loan proceeds to his co-conspirators and himself using bogus payroll checks and laundered a portion of the proceeds by transferring the funds from one of his bank accounts to another bank account he controlled.

In addition, 15 other individuals have pleaded guilty to their involvement in the loan fraud scheme.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department's Criminal Division; U.S. Attorney Alamdar S. Hamdani for the Southern District of Texas; Special Agent in Charge Mark B. Dawson of HSI Houston; Inspector General Hannibal "Mike" Ware of the SBA-OIG; Special Agent in Charge Catherine Huber of the FHFA-OIG; Acting Inspector General Tyler Smith of the FDIC-OIG; and Inspector General J. Russell George of TIGTA made the announcement.

Trial Attorneys Kate McCarthy, Spencer Ryan, Della Sentilles and Louis Manzo of the Criminal Division's Fraud Section and Assistant U.S. Attorney Rodolfo Ramirez for the Southern District of Texas are prosecuting the case.

Anyone with information about suspected COVID-19-related fraud or other criminal activity is encouraged to report it to HSI by emailing the Department of Homeland Security's S.T.O.P. COVID-19 Fraud Tipline at [email protected].

HSI launched Operation Stolen Promise (OSP) in April 2020 to protect the homeland from the increasing and evolving threat posed by COVID-19-related fraud and criminal activity. Since the operation's inception, HSI has capitalized upon its unique and expansive federal criminal investigative authorities; its strong intelligence analysis capabilities and resources; its expansive domestic and international footprint; and its robust law enforcement and private sector partnerships to lead the government's investigative response to pandemic-related crime.

For more news and information on HSI's efforts to aggressively investigate COVID-19-related fraud and criminal activity in Southeast Texas follow us on Twitter @HSIHouston.

HSI is the principal investigative arm of the U.S. Department of Homeland Security (DHS), responsible for investigating transnational crime and threats, specifically those criminal organizations that exploit the global infrastructure through which international trade, travel, and finance move. HSI's workforce of more than 8,700 employees consists of more than 6,000 special agents assigned to 237 cities throughout the United States, and 93 overseas locations in 56 countries. HSI's international presence represents DHS's largest investigative law enforcement presence abroad and one of the largest international footprints in U.S. law enforcement.

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Original text here: https://www.ice.gov/news/releases/houston-area-man-convicted-role-35m-covid-19-relief-fraud-scheme