A Phoenix man, Jamar Johnson, who received over $1 million in Paycheck Protection Program (PPP) loans by submitting fraudulent applications was sentenced to 15 months in prison after pleading guilty to Wire Fraud.
Johnson’s prison sentence is to be followed by three years of supervised release.
The 54-year-old Johnson admitted that he submitted false applications in order to obtain PPP loans on behalf of his amateur basketball league, CBL Worldwide II.
According to the Department of Justice, in one of the applications, Johnson stated that the company had 73 employees and over $4.8 million in annual payroll expenses. In reality, CBL Worldwide II had zero employees and no payroll expenses. As a result of his fraudulent misrepresentations, Johnson received two PPP loans totaling $1,007,650.
Johnson spent the money on himself, including by purchasing cryptocurrency, a vehicle, and cosmetic dentistry. At sentencing, Johnson was ordered to pay full restitution to the Small Business Administration (SBA).
The Coronavirus Aid, Relief and Economic Security (CARES) Act was enacted in March 2020 to provide emergency financial assistance to the millions of Americans who were suffering the economic effects caused by the COVID-19 pandemic. One source of relief under the CARES Act was the authorization of hundreds of billions of dollars in forgivable loans to small businesses for job retention and certain other expenses through the Paycheck Protection Program.
On April 7, the Department of Justice announced the creation of the National Fraud Enforcement Division. The core mission of the Fraud Division is to zealously investigate and prosecute those who steal or fraudulently misuse taxpayer dollars. Department of Justice efforts to combat fraud support President Trump’s Task Force to Eliminate Fraud, a whole-of-government effort chaired by Vice President J.D. Vance to eliminate fraud, waste, and abuse within Federal benefit programs.
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