WAUKESHA, Wis. - Thomas Smith of Pewaukee has pleaded guilty to one count of bank fraud for his role in fraudulently obtaining over $1 million in Paycheck Protection Program (PPP) loans guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security (CARES) Act.
The announcement comes on Tuesday, Feb. 23 from Acting U.S. Attorney Richard G. Frohling of the Eastern District of Wisconsin.
As part of his guilty plea, Smith, 46, admitted that he fraudulently sought over $1.2 million in PPP loans through applications to an insured financial institution on behalf of eight different companies.
According to his plea agreement, Smith caused fraudulent loan applications to be submitted that made numerous false and misleading statements about the companies’ respective payroll expenses. Based on these representations, the financial institution approved and funded over $1 million in loans. According to plea documents, Smith then directed his co-conspirators to send him portions of the PPP funds within days of receiving them and used the proceeds for personal expenses.
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Smith’s sentencing is set for June 2.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form.
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