[Hedley Lamarr]

YIKES!!!




“In the depths of the COVID-19 pandemic, Martinez lied to get money that was supposed to help people. His abuse of the system during a terrible time has now been brought to light. Martinez took advantage of his employees, a tax preparer, and the public at large — all to fund a lavish lifestyle of cars, jets, and fancy homes. Let me be clear, this Office will not tolerate such conduct and will continue to bring to justice those who put their greed above the law,” says U.S. Attorney Damian Williams.

The primary owner and CEO of MBE Capital Partners helped distribute $823 million in PPP loans to 36,600 businesses. Rafael Martinez earned $71.3 million in lender fees and purchased luxury cars, homes, and a chartered jet service. He will now lose it all after pleading guilty to one count of conspiracy to commit wire fraud.

Early in the pandemic, Martinez applied for a PPP loan for MBE Capital Partners. In the application, he claimed that the company had 15 employees with a monthly payroll of almost $120,000. In reality, MBE Capital Partners had four employees at most with a monthly payroll of $25,000. Martinez provided doctored, fraudulent tax records which included a forged signature of a tax preparer. The company was approved for a $283,000 PPP loan.

Within five days of applying for a PPP loan, Rafael applied to become a non-bank PPP lender. According to the application, MBE originated and serviced more than $3.8 billion in business loans from 2017 to 2019 and had the fraudulent financial statements to support this. The SBA approved MBE as a non-bank PPP lender.

Three weeks later, the same fraudulent financial statements that were submitted to the SBA were provided to a life insurance company. Martinez formed a partnership with the life insurance company to fund PPP loans for minority and women-owned small businesses. After the company provided $100 million to MBE, the money was instead used as collateral to borrow $832 million through the Payment Protection Program Liquidity Facility.

As part of the plea agreement, Martinez will pay more than $71.7 million and forfeit $44.5 million. This includes five luxury vehicles and properties in the Dominican Republic and New Jersey that law enforcement previously seized.

Source:
DOJ Press Release

[FlexibleCapitalSolutions]

YIKES!!!




“In the depths of the COVID-19 pandemic, Martinez lied to get money that was supposed to help people. His abuse of the system during a terrible time has now been brought to light. Martinez took advantage of his employees, a tax preparer, and the public at large — all to fund a lavish lifestyle of cars, jets, and fancy homes. Let me be clear, this Office will not tolerate such conduct and will continue to bring to justice those who put their greed above the law,” says U.S. Attorney Damian Williams.

The primary owner and CEO of MBE Capital Partners helped distribute $823 million in PPP loans to 36,600 businesses. Rafael Martinez earned $71.3 million in lender fees and purchased luxury cars, homes, and a chartered jet service. He will now lose it all after pleading guilty to one count of conspiracy to commit wire fraud.

Early in the pandemic, Martinez applied for a PPP loan for MBE Capital Partners. In the application, he claimed that the company had 15 employees with a monthly payroll of almost $120,000. In reality, MBE Capital Partners had four employees at most with a monthly payroll of $25,000. Martinez provided doctored, fraudulent tax records which included a forged signature of a tax preparer. The company was approved for a $283,000 PPP loan.

Within five days of applying for a PPP loan, Rafael applied to become a non-bank PPP lender. According to the application, MBE originated and serviced more than $3.8 billion in business loans from 2017 to 2019 and had the fraudulent financial statements to support this. The SBA approved MBE as a non-bank PPP lender.

Three weeks later, the same fraudulent financial statements that were submitted to the SBA were provided to a life insurance company. Martinez formed a partnership with the life insurance company to fund PPP loans for minority and women-owned small businesses. After the company provided $100 million to MBE, the money was instead used as collateral to borrow $832 million through the Payment Protection Program Liquidity Facility.

As part of the plea agreement, Martinez will pay more than $71.7 million and forfeit $44.5 million. This includes five luxury vehicles and properties in the Dominican Republic and New Jersey that law enforcement previously seized.

Source:
DOJ Press Release

I don't understand how people like this think they can get away with this. Makes no sense.

[Hedley Lamarr]

I don't understand how people like this think they can get away with this. Makes no sense.

There is a WHOLE lot more of this to come......... Right down to the guy who took 3,000 in PPP and misrepresented the SBA

[BR-Nightmare]

I don't understand how people like this think they can get away with this. Makes no sense.

'Merica

[Olderguy]

My former boss bought half of an equipment finance company and they ran all their PPP through a SBA bank because the CEO gave them a .25 kickback....why he wouldn't let me do it....

[omegafund]

hey give the little guy a chance to defraud the government, the big boys do it for multi billions in ukraine.
I actually know some guys that went to jail for defraud on PPP loans. Pretty pathetic

[Michael I]

wasn't he partners or somehow connected to magic johnson for the ppp loans ?

[Hedley Lamarr]

wasn't he partners or somehow connected to magic johnson for the ppp loans ?

Magic Johnson may no longer be playing in the NBA, but the Hall of Fame member is still making valuable assists.

Johnson announced that EquiTrust Life Insurance Co., of which he owns a majority, is providing $100 million in capital to fund federal loans for minority and women business owners who have been hit hard by the coronavirus pandemic.

Kurt Huffman owns the restaurant group ChefStable in Oregon.
These small business owners got PPP loans, but they're afraid to use the money
EquiTrust will work with MBE Capital Partners, a lender that specializes in asset-based loans for minority-owned small businesses, to distribute the loans through the federal government’s Paycheck Protection Program.

The loans are aimed at supporting people of color and women who operate businesses in underserved communities, according to a news release.

The news was first reported by The Wall Street Journal.

“These are incredible businesses, small businesses, that have been the pillar of our community that also employ a lot of black and brown people in our community,” Johnson said Sunday on MSNBC. “… We wanted to make sure that minority-owned businesses got small business loans through the PPP program.”

Concerns about people of color accessing loans
The partnership was borne out of a concern that women and people of color were having difficulty accessing the loans offered by the Small Business Administration’s emergency coronavirus relief program – part of the federal government’s massive stimulus package.

“Johnson’s EquiTrust is providing critical financial support to underserved communities and businesses that have been traditionally neglected,” EquiTrust and MBE Capital Partners said in a joint news release. “These small and diverse businesses often have difficulty developing strong lending relationships with big banks.”

The goal is to help 100,000 businesses secure resources that will sustain them through the pandemic, MBE Capital CEO Rafael Martinez said on MSNBC.

SBA program has come under criticism
The Paycheck Protection Program has been plagued by technical hiccups and questions about whether lenders were prioritizing the businesses that needed the money most after several deep-pocketed companies received loans, including the Los Angeles Lakers – the storied NBA franchise that Johnson was long affiliated with. The team returned the money.

After the initial $349 billion Congress allocated to the program ran dry, lawmakers replenished the fund with an additional $310 billion. Still, there have been concerns that money earmarked for smaller lenders is running low.

Advocacy organizations say businesses owned by people of color are inherently at a disadvantage. The funds are accessed through banks and participating SBA lenders – relationships that people of color are less likely to have.

Nurse practitioner Capri Reese talks to a patient and holds her hand while a doctor administers an IV at Roseland Community Hospital in Chicago, Tuesday, April 28, 2020. (Ashlee Rezin Garcia/Chicago Sun-Times via AP)
The coronavirus pandemic is hitting black and brown Americans especially hard on all fronts
The Center for Responsible Lending estimated in April that approximately 95% of black-owned businesses, 91% of Latino-owned businesses, 91% of Native Hawaiian or Pacific Islander-owned businesses and 75% of Asian-owned businesses were unlikely to receive a PPP loan through a mainstream bank or credit union.

The federal CARES Act, which created the Paycheck Protection Program, instructed the SBA to prioritize underserved and rural markets. But a recent inspector general report found that the agency had not communicated this priority to lenders.

The report also found that the SBA did not require demographic data to identify borrowers of the program in underserved markets, making it hard to determine how much funding was going towards the intended communities.

[Big Mack]

I don't understand how he had the bandwidth to facilitate that kind of volume nor how he earned commissions over 8% on PPP while the max allowed was 1%. How do you collect 36,000 PSF's?

[Michael I]

they starting to go after the smaller loans
https://www.justice.gov/usao-edmo/pr...mic-loan-fraud

[Hedley Lamarr]

they starting to go after the smaller loans
https://www.justice.gov/usao-edmo/pr...mic-loan-fraud

Wait till you see the news regarding people in the financial services industry that come off as big shots that got caught receiving small amounts of PPP. It's gonna suck getting popped for bank fraud and defrauding the federal government.

[Olderguy]

Wait till you see the news regarding people in the financial services industry that come off as big shots that got caught receiving small amounts of PPP. It's gonna suck getting popped for bank fraud and defrauding the federal government.

Yup I know several including my former boss.

[Hedley Lamarr]

What's really wild....... PPP records are public. You can find anyone that received PPP by searching the records. There is also a whistle blower reward program. If someone reports someone who illegitimately received PPP funds they can get up to 30% of the recovered amount......and them watch this person go to jail for defrauding the government, falsifying records, and bank fraud.

[J.Celifarco]

Wait till they start looking at the ERC's and the amount of fraud with that

[Hedley Lamarr]

They already have.......

[fundinggrasshopper]

'Merica

https://www.youtube.com/watch?v=K0ck7hTsug8
https://www.youtube.com/watch?v=lsASy4SMaoM

MAGA

[Hedley Lamarr]

Some criminals and those who assisted them stole millions of dollars. Really stupid people stole much less and will face the same demise.