An Eastside tech executive has been taken into custody for allegedly seeking over $5.5 million in Paycheck Protection Program (PPP) loans and laundering the proceeds.
According to a release from the U.S. Department of Justice Attorney’s Office for the Western District of Washington, the 48-year-old Clyde Hill man Mukund Mohan was charged with a criminal complaint of one count money laundering and one count wire fraud.
The criminal complaint alleges that Mohan fraudulently sought these Coronavirus business relief loans for six different companies, providing altered documents and tax findings and making various misleading statements about staffing and ownership of the businesses. From April to June, Mohan submitted eight loan applications to five different financial institutions.
Four of these companies were not registered with the Department of Revenue nor had a business license. One company, Zuput, was registered for a business license around the same time Mohan uses it to apply for a PPP loan. There is no record of these companies paying any employee wages. The sixth company, Mahenjo, was purchased by Mohan recently and had not been in operation or had employees from December 2018 to May 2020, although Mohan’s application indicated it paid $2,376,500 to employees in 2019.
The complaint further alleges that Mohan transferred at least $231,000 in fraudulently-obtained loan proceeds to his personal brokerage account for his personal benefit.
The CARES Act is a federal law enacted on March 29, designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses, through the PPP. In April 2020, Congress authorized over $300 billion in additional PPP funding.
The PPP allows qualifying small-businesses and other organizations to receive loans with a maturity of two years and an interest rate of 1%.
