A Dallas-Irving man and a Chicago woman face federal charges after prosecutors accused them of using fraudulent applications to generate more than $11 million in Paycheck Protection Program loans and collect kickbacks.
A federal grand jury indicted Latrina Dorsey, 50, of Chicago, and Dushawn Nelson, 50, of Dallas and Irving, on Wednesday. The indictment charges each defendant with one count of conspiracy to commit wire fraud and four counts of wire fraud, the U.S. Attorney’s Office for the Northern District of Texas announced Friday.
Prosecutors allege a repeatable loan formula
Prosecutors allege that Dorsey and Nelson submitted or helped submit hundreds of fraudulent PPP applications from June 2020 through September 2022. Congress created the program to provide forgivable loans to small businesses struggling during COVID-19 lockdowns and economic disruptions.
The indictment alleges that Dorsey prepared applications with fabricated financial information and fictitious IRS Schedule C forms. Many applications claimed the borrowers earned exactly $100,000 in gross income during 2019, regardless of their actual earnings.
Nelson allegedly referred applicants to Dorsey in exchange for kickbacks before he began submitting applications himself, according to prosecutors.
Loan processors Blueacorn, Womply, Bluevine and Kabbage routed the applications to SBA-approved lenders including Celtic Bank and Cross River Bank. The Justice Department’s release did not accuse the processors or lenders of wrongdoing.
Lenders funded approximately 561 loans totaling $11,049,548, prosecutors said. Applicants allegedly paid Dorsey, Nelson or other co-conspirators kickbacks ranging from $2,000 to $5,000 through cash or electronic transfers.
Each defendant faces up to 20 years
“The alleged conduct in this case represents a brazen theft of taxpayer-funded relief at a moment when Americans needed it most,” U.S. Attorney Ryan Raybould said.
If convicted, each defendant could receive up to 20 years in federal prison, a fine of up to $250,000 and up to three years of supervised release.
The U.S. Railroad Retirement Board Office of Inspector General and the FBI Chicago Field Office investigated the case. Assistant U.S. Attorney Chad E. Meacham of the Fraud Section is prosecuting it.
The case follows other federal efforts to recover pandemic-relief funds. The Dallas Express previously reported that authorities charged 23 North Texas residents in an unrelated PPP fraud investigation involving more than $3.5 million.
The indictment contains allegations rather than evidence of guilt. The law presumes Dorsey and Nelson innocent unless prosecutors prove each charge beyond a reasonable doubt.
Provided by Dallas Express
