ATLANTA — Two of the 22 suspects indicted for an $11.1 million Paycheck Protection Program loan fraud scheme were convicted, according to the U.S. Department of Justice.
Officials announced Friday that Teldrin Foster and Carla Jackson were convicted by a federal jury in Atlanta on Thursday. The two, from Decatur and Tucker respectively, faced charges of a variety of types of financial fraud and money laundering.
As previously reported by Channel 2 Action News, they were first charged in 2021 among nearly two dozen people involved in the PPP fraud scheme, USDOJ said. During the investigation, federal officials seized almost $4 million in PPP loan proceeds, four luxury vehicles, and several jewelry items.
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Foster was convicted of bank fraud, wire fraud, conspiracy to commit bank fraud and wire fraud, making false statements to a federally insured financial institution and money laundering in connection to 14 loan applications.
Separately, Jackson was convicted of two counts of money laundering in connection with laundering the proceeds of a PPP loan.
The Paycheck Protection Program was created by the federal government to help business owners during the COVID-19 pandemic, offering forgivable loans to cover expenses such as payroll and other business needs during the pandemic.
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Court records, and evidence at trial, show that Foster and co-conspirators submitted or helped submit PPP applications on behalf of 14 businesses for loans of roughly $800,000 each.
“In the loan applications, the co-conspirators certified that each applicant business was in operation on Feb. 15, 2020, and had employees for whom it paid salaries and payroll taxes or that it paid independent contractors; that the funds would be used to retain workers and maintain payroll or to make mortgage interest payments, lease payments, and utility payments,” according to the Dept. of Justice.
Further, USDOJ said “co-conspirators reported that each business had approximately 60 employees and approximately $300,000 in average monthly payroll expenses.”
To get the loan approved, USDOJ said the co-conspirators provided an IRS Form 941, which is used to report payroll taxes, but “in reality, each Form 941 was fraudulent.”
The loans were approved and deposited into the businesses’ accounts, then Jackson and others laundered some of the funds through transactions made to disguise where the funds came from and how they were spent, USDOJ said.
Now, justice officials say Foster and Jackson face up to 20 years in prison for the wire fraud and money laundering charges, and a possibility of 30 years for each bank fraud and false statement charge.
A sentencing hearing has not yet been scheduled.
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