By: States Attorney.
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$8.4 Million in Coronavirus Relief Funds Seized from Bogus Florida Ministry
A fake family-run ministry in Orlando, Florida fraudulently obtained millions of dollars in coronavirus relief funds from the Paycheck Protection Program (PPP), and the family behind the ministry planned to use some of the loan money to buy a multimillion-dollar home near Disney World, alleges a federal complaint filed in the U.S. District Court for the Middle District of Florida. Officials say ASLAN International Ministry appears to be a bogus ministry that Dr. Evan Edwards, along with his wife Mary Jane, his son Joshua, and his daughter Joy, used as part of a scheme to steal emergency relief funds intended to keep small businesses afloat during the COVID-19 crisis. According to a December 14 federal court filing, investigators seized $8.4 million in fraudulently obtained PPP funds from several bank accounts held in different names, which the family allegedly used to launder the PPP loans.
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Details of the Florida “Ministry” PPP Fraud Case
In federal court documents, prosecutors described how the Edwards family allegedly used ASLAN, a purported religious nonprofit organization, to fraudulently obtain a loan through the Paycheck Protection Program and then funneled the money through several bank accounts in June, July, August and September, in an attempt to conceal the source, nature and location of the loan proceeds. Records show that Joshua Edwards applied for the PPP loan in early April, claiming that ASLAN had 486 employees and monthly payroll expenses of $2.76 million. Based on the fraudulent PPP application, ASLAN was approved for a loan of more than $8.4 million in May. Reports indicate that $868,250 of the loan proceeds ended up in a separate bank account under the name of Mary Jane Edwards, and that the family intended to use that money as a down payment on a $3.7 million home in Disney World’s exclusive Golden Oak development.
In September 2020, federal agents visited the address listed on ASLAN’s PPP application, but no one answered the door and other tenants at the property said they had not seen anyone at the office or any signs that it was occupied. On September 16, the Secret Service visited the Edwards’ family home outside Orlando, only to find that the residence appeared to have been vacated. That same day, the Secret Service seized the $868,250 and the rest of the $8.4 million loan funds from various bank accounts. The following day, the Florida Department of Law Enforcement stopped a vehicle for speeding and found that it contained all four members of the Edwards family, along with suitcases, financial documents, business records and news articles about investigations into SBA loan fraud.
A federal search warrant was issued and officials seized multiple laptops, tablets and hard drives from inside the Edwards’ vehicle. “Evan was in the front passenger seat with an opened box containing a laser printer on his lap,” court documents state. “In the rear passenger seat were two clear garbage bags containing what appeared to be shredded documents. In the rear cargo area, multiple suitcases were stacked from floor to the ceiling, along with a document shredder.” The shredder was reportedly purchased just two hours after agents had attempted to interview the family at their home. Authorities also found evidence that the Edwards family had applied for and each received $2,000 in COVID-19 assistance in Canada and had also attempted to apply for another PPP loan under ASLAN’s name through another lender. Federal court filings indicate that the Edwards family is currently under investigation by the Secret Service for fraud in connection with the Paycheck Protection Program.
The CARES Act and the Paycheck Protection Program
The Paycheck Protection Program is a federal loan program created as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act in April to provide relief to small businesses struggling to survive the economic fallout of COVID-19 and the shutdowns and stay-at-home orders stemming from the outbreak. More than $650 billion in federal funding was set aside to grant forgivable loans backed by the Small Business Administration (SBA) to qualifying small businesses to pay their employees and cover certain eligible business expenses during the coronavirus pandemic. However, the Government Accountability Office (GAO) warned in a recent report that the streamlining of the approval process for PPP loans, which required only “minimal” underwriting from lenders, created a “significant” risk of fraud. “Because of the number of loans approved, the speed with which they were processed, and the limited safeguards, there is a significant risk that some fraudulent or inflated applications were approved,” the GAO wrote in its report. “In addition, the lack of clear guidance has increased the likelihood that borrowers may misuse loan proceeds or be surprised they do not qualify for full loan forgiveness.”
Federal Investigation into SBA Loan Fraud
The Edwards’ case is just the latest in a string of federal investigations into fraudulent activity involving the CARES Act and the Paycheck Protection Program. As the coronavirus pandemic continues, the federal government is working diligently to uncover crimes involving PPP loan fraud and bring those accused of defrauding the Paycheck Protection Program to justice. Already, federal officials have arrested more than 80 individuals accused of committing fraud and seized more than $240 million in fraudulently obtained PPP loans guaranteed by the SBA. The Secret Service alone has as many as 700 pending investigations into allegations of PPP loan fraud. “The American people and particularly those small business owners who are suffering can rest assured that the Secret Service, the Small Business Administration and our Cyber Fraud Task Forces are proactively identifying and investigating any individual or entity that fraudulently obtained a SBA loan,” U.S. Secret Service Special Agent in Charge Caroline O’Brien-Buster said in an email.
Among the criminal charges that have been brought against those accused of committing PPP loan fraud are bank fraud, wire fraud, money laundering and false statements. Such federal crimes are taken extremely seriously, and the penalties associated with a conviction are severe. For instance, a person convicted of committing bank fraud or wire fraud in connection with the Paycheck Protection Program faces a maximum federal prison sentence of up to 30 years.