Fraud Case of $6.6M Paycheck Protection Program- Riverside County Man Sentenced to 8 Years in Prison
A Corona man was sentenced Monday to 102 months in federal prison for filing bogus loan applications that brought him more than $6.6 million in Paycheck Protection Program and Economic Injury Disaster Loan monies.
Muhammad Atta, 39, was also ordered to pay $6,643,540 in restitution. He pled guilty in August in Los Angeles to federal counts of wire fraud and laundering of monetary instruments, according to the U.S. Attorney’s Office.
“It’s vital that the sentence given today delivers the message that there are substantial consequences for cheating government relief programs,” U.S. District Judge Percy Anderson said from the bench in downtown Los Angeles.
Atta submitted 11 false PPP loan applications for seven sham firms
The applications overstated the number of employees and the typical monthly payroll expenses of Atta’s firms, and falsely declared he would use the loan proceeds for acceptable business reasons.
Atta also filed fraudulent tax and payroll data in support of his applications. Although none of his businesses qualified for relief funding at the time, Atta got over $6.6 million in loan proceeds. Proceeds from the loans were subsequently transferred to his American and Pakistani bank accounts, where he engaged in money laundering.
Atta’s plea deal recounts one PPP loan in which he requested around $1.2 million for a company called Envisioning Future Inc. The loan application fraudulently stated that Envisioning had 73 employees and falsely certified the company would use the loan proceeds for acceptable business reasons, including the payment of salary and other business-related expenses.
Prosecutors allege that a bogus application was submitted on April 10, 2020, with supporting documents including fabricated federal tax returns and payroll data. Around a month later, Envisioning received about $1.2 million in loan profits, and the next day Atta moved most of the money to his mother’s bank account.
Atta then transferred $1.3 million, the vast bulk of which originated from the Envisioning PPP financing, to a bank in Islamabad, Pakistan in June 2020. According to the plea deal, the wire transfer information included a remark indicating the wire was “family support.”
