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New Rochelle resident Glenroy Walker, age 65, Mount Vernon resident Gary Wheeler, age 46, Freeport resident Sherril Baez, age 50, and three others are charged with scheming to steal more than $14 million from the federal Paycheck Protection Program (PPP), the US Attorney's Office for the Southern District of New York announced on Tuesday, June 6.
The PPP, which is administered by the US Small Business Administration, was created by Congress to give billions of dollars in forgivable loans to small businesses that were struggling to pay employees and other expenses during the height of the pandemic.
According to federal officials, between July 2020 and February 2022, Walker and Bronx resident Howard Levy, age 60, led a scheme to submit fake applications for loans from the PPP.
As part of this plan, the two men allegedly submitted more than 100 of these fake applications to various financial institutions, which frequently contained false bank statements and tax documents.
Along with Walker and Levy, Wheeler would also participate in the scheme by submitting fake applications for their own purported businesses and recruiting others into the plan, federal officials said.
Along with Walker, Levy, Baez, and Wheeler, the following people also allegedly participated in submitting false applications and were charged:
- Bronx resident Norma Gettin, age 62;
- Paterson, New Jersey resident Donnat Powell, age 48.
As a result of the scheme, Walker and Levy would receive significant kickbacks from the other participants and would share portions of them with recruiters, including some of the other defendants.
In total, the fraudulent applications submitted to the PPP by all six defendants sought more than $14.7 million in loans and resulted in more than $4.6 million being disbursed from multiple financial institutions. All of the disbursed funds were guaranteed by the US Small Business Administration.
Each of the six defendants was charged with conspiracy to commit wire fraud affecting a financial institution, which carries a maximum sentence of 30 years in prison.
Additionally, Walker and Levy were charged with a single count of aggravated identity theft, which carries a mandatory two-year consecutive sentence.
US Attorney Damian Williams said that all six defendants took advantage of a program meant to help people.
"As alleged, the defendants schemed to steal millions of dollars from a program Congress created to help struggling small businesses weather the COVID-19 pandemic," he said, adding, "As we continue to recover from the COVID-19 pandemic, this office will pursue and prosecute the fraudsters that took advantage of a global emergency to greedily line their own pockets.”
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