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COVID-19: Alleged PPP Kickback Scheme Reportedly Under Investigation In Westchester

Mount Vernon City Hall will be closed in observance of Columbus Day on Monday.
Mount Vernon City Hall will be closed in observance of Columbus Day on Monday. Photo Credit: File photo

Some city employees in Mount Vernon are facing an investigation for allegedly concocting a plan to cheat the Paycheck Protection Program during the COVID-19 pandemic.

This week, with rumors mounting of a potential federal probe into a kickback scheme, Mount Vernon Mayor Shawyn Patterson-Howard issued a memo to city employees warning that there could be consequences if there is truth behind rumors of a possible scam.

"If you applied for and/or received a loan, grant or ANY form of payment as part of the recently discovered 'process' that required you pay a portion of the disbursement back as an application fee, you will need to contact your commissioner, HR commissioner Holly Francis-Merritt or Chief of Staff Darren Morton immediately,” she wrote.

The PPP loan forgiveness program was intended to assist businesses that were unable to do business during the COVID-19 pandemic.

It is alleged that PPP applications were filled out, falsely stating that the workers were business owners in need of financial support due to the outbreak. The employees allegedly gave personal information to one ringleader running the scheme, who received kickbacks once the PPP checks cleared.

No official investigation into any potential PPP scheme has been announced by any law enforcement agency to date.

Mount Vernon Safety Commissioner Glenn Scott took to social media to condemn any potential schemers, stating that he will throw the book at them if they are found guilty.

“It is extremely simple,” he posted on Facebook, noting that it is a personal comment, not the opinion of the city. “If a city employee is brought up on charges by a federal agency for fraud, they are required to be terminated by our administration.

Scott said that anyone who is prosecuted by the federal government for a potential PPP scheme will have to pay back the grant or loan, their assets will be frozen and the government will recoup the stolen money.

“If the loan or grant is not repaid or if the government wishes to charge fraud, this has nothing to do with the city. And that is between the government and them. Like taxes,” Scott said. “If there is a central broker behind these actions, then the government locks them up on federal charges.

“This is an issue of personal risk, greed, and a lack of ethical behavior,” he continued. “The lack of ethical behavior is also city employee termination standard.” 

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