Johns Creek man, ‘mastermind’ of $11M PPP fraud scheme, gets 15 years in prison

Defendant helped coordinate 14 loans using almost identical applications, officials say

Credit: File photo

Credit: File photo

A Fulton County man at the center of a wide-ranging scheme that siphoned away more than $11 million worth of funds from the Paycheck Protection Program was sentenced to 15 years in prison, according to federal officials.

Darrell Thomas, 36, of Johns Creek, pleaded guilty last summer to one count of conspiracy to commit bank fraud and one count of money laundering, U.S. Attorney for the Northern District of Georgia Ryan K. Buchanan said. Thomas’ 15 years in prison will be followed by five years on probation, and he has been ordered to pay restitution of more than $13 million for multiple fraud schemes, Buchanan said.

After pleading guilty, Thomas forfeited more than $2 million in seized funds along with other assets bought with the proceeds of his fraud, Buchanan said. Thomas also surrendered multiple pieces of jewelry, including a gold Rolex watch, and three luxury cars: a 2018 Mercedes-Benz S65AMG, a 2018 Land Rover Range Rover and a 2017 Acura NSX.

As part of his plea, Thomas admitted that he obtained fraudulent Economic Injury Disaster loans of more than $1 million and car loans of nearly $2.5 million, in addition to the $11.1 million PPP money, the U.S. Attorney’s Office said.

According to Buchanan, Thomas was the “mastermind” behind a fraud scheme that stretched across the country and has, so far, led to charges against 23 people. Thomas is among 12 people who have pleaded guilty, six of whom have already been sentenced. The 11 other suspects have charges pending, Buchanan said.

The case against Thomas focused on the months from April through August of 2020, according to the U.S. Attorney’s Office. Thomas admitted to orchestrating a scheme that secured 14 PPP loans in amounts between $700,000 and $850,000.

The Paycheck Protection Program was created as part of the CARES Act, which provided funds to businesses affected by the COVID-19 pandemic to ensure they could continue paying workers. Thomas coordinated with other defendants to submit falsified loan applications that included fake payroll information. None of the businesses had any employees or payroll expenses, and the loan applications were essentially identical, Buchanan said.

Once the PPP loans were deposited into the business accounts, about $5.5 million was transferred to an account held by Thomas, according to federal officials. The remaining funds were used by the supposed business owners for personal expenses. Buchanan said the U.S. Justice Department has seized more than $4 million in PPP loan proceeds from participants in the scheme.

Of the 11 others found guilty, five were from Georgia, federal officials said, but the case also ensnared defendants in California, Michigan and Ohio.

“Thomas orchestrated a massive fraudulent scheme to greedily line his pockets with stolen government funds that were intended to provide relief to small businesses and their employees during the COVID-19 pandemic,” Keri Farley, Special Agent of FBI Atlanta, said. “Hopefully, Thomas enjoyed his short-lived fun with all the luxury items purchased with stolen taxpayer money, as he will now pay for his crimes with a lengthy prison sentence.”