Two men of Indian origin in the United States have pleaded guilty to their participation in a multi-million dollar fraud scheme by obtaining loans under an economic assistance plan following the Covid-19 pandemic in the country, the justice department said.

The Department of Justice in a statement said Nishant Patel, 41, & Harjeet Singh, 49, both from Houston & 3 others engaged in fraudulently obtaining & laundering millions of dollars in forgivable Paycheck Protection Programme (PPP) loans that the Small Business Administration (SBA) guarantees under the CARES Act.

They admitted to submitting false & fraudulent PPP loan applications to SBA & certain SBA-approved PPP lenders.

All 5 defendants also assisted in laundering the fraudulently obtained PPP loan funds by supplying co-conspirators with blank, endorsed checks, which were made payable to people posing as employees of the companies that received the PPP loan, but who were in fact not employees.

These fake pay cheques were then cashed at check-cashing stores that other members of the conspiracy controlled.

As part of the scheme, Patel obtained a false & fraudulent PPP loan of about $474,993 & Singh obtained two false & fraudulent PPP loans for a total of $937,379, the statement said.

The 3 others involved in the fraud obtained a total amount of more than $1.4 million, it added.

They are scheduled to be sentenced on January 4 next year & each face a total maximum penalty of 5 years in prison.

In addition to these 5 defendants, one other individual was convicted at trial for his involvement in the scheme, & 15 other individuals have pleaded guilty to their involvement in the loan fraud scheme.

The Coronavirus Aid, Relief, & Economic Security (CARES) Act of 2020 provided fast & direct economic assistance for American workers, families, small businesses, & industries affected by the Covid-19 pandemic.

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