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National Insurance Crime Bureau

Bowie County Man Charged with $5 Million COVID-Relief Fraud

U.S. Attorney’s Office – Eastern District of Texas, January 19, 2021

Individual Copied List of Names off the Internet and Claimed Them as Employees

TEXARKANA, Texas – A 32-year-old Maud, Texas man has been charged with allegedly filing bank loan applications fraudulently seeking more than $5 million dollars in forgivable loans guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, announced Eastern District of Texas U.S. Attorney Stephen J. Cox today.

Samuel Yates was charged with two counts of wire fraud returned by a federal grand jury in Texarkana, Texas, on Jan. 14, 2021. Yates allegedly sought millions of dollars in forgivable loans guaranteed by the SBA from two different banks by claiming to have over 400 employees earning wages when, in fact, no employees worked for his purported business.

According to court documents unsealed today in U.S. District Court in Texarkana, Yates allegedly made two fraudulent applications to two different lenders for loans guaranteed by the SBA for COVID-19 relief through the PPP. In the application submitted to the first lender, Yates allegedly sought $5 million in PPP loan proceeds by fraudulently claiming to have over 400 employees with an average monthly payroll of more than $2 million. In the second application, Yates claimed to employ over 100 individuals and was able to obtain a loan over $500,000. With each application, Yates submitted a list of purported employees that he obtained from a publicly available random name generator on the internet. He also submitted forged tax documents with each application.

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