NJ man pleads guilty to getting $900,000 COVID loan for fake company
A New Jersey man has admitted in federal court to his role in a scheme to fraudulently obtain a $900,000 Payroll Protection Program (PPP) loan during the pandemic by getting money for a company that has no workers or payroll.
Joseph McKeon, also known as "Jay," 54, pleaded guilty before U.S. District Judge Julien Xavier Neals in Newark federal court to an indictment charging him with one count of wire fraud and one count of money laundering.
Court papers say that from February 2021 through February 2022, McKeon submitted fraudulent PPP loan and forgiveness applications for $900,000 on behalf of a New Jersey company, B & T Builders of Westfield, he purportedly owned.
In support of those applications, McKeon lied about the number of employees the business employed and the income the employees earned, documents say.
Court papers say McKeon claimed the business had 60 employees and a monthly payroll of $360,000.
But authorities said the business had no employees or payroll.
After the victim lender funded the loan, McKeon withdrew a significant amount of the loan proceeds as cash and made several large transfers between bank accounts, including one transfer for $315,504, that was sent to an Indiana title company.
McKeon later submitted a loan application application to the lender. The federal Small Business Administration then remitted to the lender the $900,000 principal and $13,068.49 in interest.
The wire fraud charge carries a maximum penalty of 20 years in prison and a maximum fine of $250,000.
The money laundering conspiracy count carries a maximum penalty of 10 years in prison and a $250,000 fine.
Sentencing is scheduled for April 1, 2025.
The District of New Jersey COVID-19 Fraud Enforcement Strike Force is one of five strike forces established throughout the United States by the Department of Justice to investigate and prosecute COVID-19 fraud. The strike forces focus on large-scale, multi-state pandemic relief fraud perpetrated by criminal organizations and transnational actors. The strike forces are interagency law enforcement efforts, using prosecutor-led and data analyst-driven teams designed to identify and bring to justice those who stole pandemic relief funds.
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 at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
Email: mdeak@MyCentralJersey.com