A Coppell man who spent more than $17 million in Paycheck Protection Program loans on personal expenses has been charged with filing fraudulent loan applications.
According to Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department's Criminal Division and U.S. Attorney for the Northern District of Texas Erin Nealy Cox, a federal grand jury indicted 55-year-old Dinesh Sah on three counts of wire fraud, three counts of bank fraud, and one count of money laundering.
"Mr. Sah exploited this terrible pandemic for personal gain - and he should be held accountable to the American people for that behavior," U.S. Attorney Erin Nealy Cox said. "COVID-19 has devastated the finances of hardworking business owners across the nation. PPP funds should be reserved for those who really need them to keep their companies afloat. We are committed to ensuring that anyone that take advantage of the system will be brought to justice. "
According to the indictment, Sah allegedly submitted 15 fraudulent applications under the names of various purported businesses that he owned or controlled to eight Small Business Administration-approved lenders seeking approximately $24.8 million in PPP loans.
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David Wolstenholm runs DWs remodeling company.
As a small business he was hoping to get help from the Payment Protection Program.
"It seemed like an easy process and then about two and half, three weeks later they said the funds dried up," Wolstenholm said.
It's frustrating to him to hear people getting the money through possible fraud.
"It still bothers me that they could easily give out millions of dollars to companies, like I said, if they have the right paperwork and know what to do and say they are going to get the money," Wolstenholm said.
PPP loans are guaranteed by the Small Business Administration under the Coronavirus Aid, Relief, and Economic Security Act, a federal law enacted on March 29, 2020.
The law is designed to provide financial assistance to Americans who are suffering financially as a result of the COVID-19 pandemic.
Wolstenholm fears what Sah is accused of hurts everyone.
"It's people like that who make it harder on everybody else that's trying to run legitimate businesses and run their business correctly and the government in turn puts all these other restrictions and makes it harder for everybody else trying to be legit," Wolstenholm said.
The indictment alleged that in Sah's applications, he allegedly claimed that his businesses had numerous employees and hundreds of thousands of dollars in payroll expenses.
According to Rabbitt and Cox, Sah created many of the businesses after the CARES Act was enacted, and none of the businesses had the employees or paid wages that he claimed in the PPP applications.
The indictment also alleged that Sah submitted fraudulent documentation along with his applications, including falsified federal tax filings and forged bank statements.
Sah received approximately $17.7 million in PPP loan funds, and he allegedly used the funds primarily for personal expenses. Court documents showed that Sah spent the funds on multiple homes and luxury cars, including a 2020 Bentley convertible, and he sent millions of dollars in international transfers.
The federal complaint affidavit indicated that Sah used $266,502 to pay off the mortgage at his house in Coppell. He also used $450,000 to purchase another house in Coppell, used $537,250 to pay off two houses in his wife's name in California, and wire transferred $50,000 to India.
Rabbitt and Cox said the government has seized more than $6.5 million in fraudulent funds that Sah obtained during the scheme. The indictment alleged that the government also seized six residences in Coppell and properties in West Hills and Canoga Hills in California.
"Today's indictment shows Mr. Sah's disgraceful display of greed," Tamera Cantu, IRS-CI's Special Agent in Charge of the Dallas Field Office, said. "Mr. Sah looked at the Paycheck Protection Program as his own personal piggy bank, treating himself to not only millions in cash, but several luxury vehicles and properties, all while legitimate small business owners in the United States desperately sought out ways to put food on their tables and to ensure their employees were paid. This indictment reinforces that IRS Criminal Investigation, the U.S. Attorney's Office and our federal partners in the Northern District of Texas are dedicated to working together to protect innocent Americans from these CARES Act fraudsters."
An indictment is an allegation, and it is not evidence. Sah is presumed innocent unless and until proven guilty, Rabbitt and Cox said.