Final Co-Defendant in Pandemic Relief Fraud Scheme Sentenced to Federal Prison

Sharmaine Simpson, 37, of Pelham, Georgia, was sentenced to 30 months in federal prison on August 15, following a guilty plea to one count of wire fraud. This sentence will be followed by three years of supervised release. Simpson is the final defendant in a case involving a fraud scheme that illegally sought over $1 million from pandemic relief funds.

In related sentencing, on March 13, co-defendants Jeremy Russell, 38, of Pelham, Georgia, and Mario Meadows, 46, of Albany, Georgia, each received 30 and 24 months in prison, respectively, along with three years of supervised release. Both had previously pleaded guilty to one count of wire fraud. Travon Duhart, 40, of Montgomery, Alabama, received a 24-month prison sentence followed by three years of supervised release after pleading guilty to two counts of wire fraud. Johnderrious Lovett, 31, of Dacula, Georgia, was sentenced to 12 months and one day in prison, also followed by three years of supervised release, for his guilty plea to one count of conspiracy to commit wire fraud. Chief U.S. District Judge Leslie Gardner presided over the case.

According to court documents, from March 2020 to at least April 2021, the defendants conspired to submit at least 25 fraudulent Economic Injury Disaster Loans (EIDLs) and Paycheck Protection Program (PPP) loan applications, seeking a total of $1,079,233.02, plus unemployment benefits. They received and deposited $411,657.02 from the Small Business Administration (SBA). The loan applications were filled with fabricated information, including false revenues, employees, payroll costs, and tax returns. Despite several loans being flagged for fraud, the defendants continued their attempts to secure funds through the SBA and other government entities.

An example of their scheme involved a $100,000 loan for J.T.L.S. Music Group, where Russell, Duhart, Lovett, and Simpson were listed as 25% owners. The application claimed ten employees, but the Georgia Department of Labor reported no wages or unemployment insurance payments from 2017 to 2022, and no income or taxes were reported to the State of Georgia or the IRS.

The Coronavirus Aid, Relief, and Economic Security (CARES) Act, enacted in March 2020, aimed to provide emergency financial support during the COVID-19 pandemic through EIDLs and forgivable PPP loans. The case was investigated by the FBI and the Department of Justice, Office of Inspector General (DOJ-OIG), with prosecution led by Criminal Chief Leah McEwen.