A Fredericksburg man has pled guilty to one count of conspiracy to commit wire fraud for his involvement in defrauding a federal COVID-19 relief program.
Sherman Green Jr., 34, incorporated Green Information Solutions LLC (GIS) in September 2017, establishing business banking accounts for the entity at Navy Federal Credit Union (NFCU), according to court documents. In May 2020, a co-conspirator informed Green about the Paycheck Protection Program (PPP), a relief initiative designed to provide Small Business Administration-backed loans to help businesses, nonprofits, and other entities retain employees or remain operational during the pandemic.
Green and his co-conspirator prepared and submitted a fraudulent PPP loan application to Atlantic Union Bank with assistance from a senior bank officer. Green falsely claimed to be the President/CEO of GIS and stated that the company employed seven workers with an average monthly payroll of $78,215.41. As a result, Atlantic Union Bank awarded GIS a $195,500 first-draw PPP loan, which was deposited into a GIS account at the bank on May 11, 2020.
Green used the fraudulently obtained loan to purchase cashier’s checks, which he deposited into GIS’s NFCU business checking account. Despite indicating on memo lines that the checks were for “payroll” or other business expenses, GIS had no employees or legitimate expenses. Between May 2020 and March 2021, Green transferred $81,131.60 from GIS’s NFCU business account to his personal account.
In March 2021, Green and his co-conspirator submitted a second fraudulent PPP loan application to Atlantic Union Bank. This application falsely claimed that GIS had five employees with an average monthly payroll of $57,486 and gross receipts of approximately $1,000,500 in 2019 and $700,000 in 2020. Based on these misrepresentations, the bank awarded GIS a $143,715 second-draw PPP loan. Green set up payroll and expense accounts at Atlantic Union Bank and transferred the second-draw funds into them, using the money for various personal expenses, including payments to Ford Motor Credit.
To conceal the misuse of the PPP loans, Green created a QuickBooks account, making it appear that transfers were for “payroll” in bank statements. From June 15 to July 15, 2021, he made seven such transactions, knowing they involved criminally derived property.
Green is scheduled to be sentenced on September 3 and faces a maximum penalty of five years in prison. Federal sentences are typically less than the maximum penalties, with the actual sentence to be determined by a judge considering the U.S. Sentencing Guidelines and other statutory factors.