A Florida roofer who allegedly spent nearly $700,000 in federal Paycheck Protection Program money to buy a 40-ft-long pleasure boat is the latest of four individuals with construction-related businesses ensnared in fraud charges related to the COVID-19 small business rescue program, federal prosecutors say.
Casey Crowther, 35, was charged with making a false statement to a financial institution in his application for just under $2.1 million in funding for his roofing business, Target Roofing & Sheet Metal Inc.
Crowther pledged in his loan application to use the money to make payroll, pay rent and utilities, and meet other business expenses, but within days of receiving it, he allegedly bought a new 40-ft catamaran boat for about $689,417 that he registered in his name, claimed U. S. Attorney Maria Chapa Lopez in a press release.
Crowther also allegedly transferred $100,000 to the bank account of a former stakeholder of his Fort Myers-based company who resigned more than six months ago, according to a copy of the criminal complaint filed by Brian Kirby, a senior special agent for the U.S. Secret Service, which is investigating the case.
Facing up to 30 years in prison if convicted, Crowther is the principal in one of a handful of construction-related companies charged in connection with the $649-billion PPP program. A spokesman for Target Roofing & Sheet Metal declined to comment on the charges on Sept. 14.
Design and construction companies made up the largest segment of companies that applied and were approved for funding under PPP, a program run by the U.S. Small Business Administration. Contractor associations lobbied hard to make terms as friendly as possible for construction contractors, especially related to permitted uses of funds, the time period in which they must be spent and terms that would allow loans to be forgiven. Although the final list of companies that used approved loans remains unknown, based on the long list of firms approved, tens and possibly hundreds of thousands of jobs were likely saved.
SBA Loan Information Supplied to Banks
Banks played a key role, collecting information from clients and making judgments about the credit-worthiness based on information provided to the banks.
More than three dozen borrowers of different types have been charged with misrepresenting or misusing the funds, including a man on parole in Virginia, a Hollywood film producer, a Georgia reality TV star and a software engineer from Washington.
Construction-related companies charged include Minnesota contractor Kyle Brenizer, whom federal officials claim committed “COVID-relief fraud” and money laundering after transferring the vast majority of $841,000 in PPP loan money into an unrelated account, then allegedly usIng it for personal expenses.
Brenizer, owner of True-Cut Construction, allegedly spent $29,000 on a Harley-Davidson motorcycle and another $1,000 on golfing expenses, according to U.S. Attorney Erica H. MacDonald.
Brenizer was initially rejected for a PPP loan and warned last December to stop doing business after his contractor’s license had expired.
According to charges against him, he then submitted a second application under the name of another person who he said owned 90% of the company, which he claimed had 30 employees and a monthly payroll of $336,400.
Both claims were false, say prosecutors, who contend Brenizer also lied when he claimed to not to have any pending criminal charges, despite the fact he faced “multiple felony charges” in Minnesota for “check forgery, identify theft and theft by swindle.”
Brenizer also submitted “fraudulent supporting documentation, such as falsified bank statements and IRS documents,” to support his PPP application, prosecutors say.
In July, the owner of a small Washington, D.C. construction company was charged with fraudulently obtaining two PPP loans worth more than $400,000, and a Texas engineer was accused of trying to obtain $10 million in loans to support 250 employees, when in fact there was no one on the payroll.
This story was updated Sept. 14 to reflect that a company spokesman for Target Roofing & Sheet Metal declined to comment on the charges against Casey Crowther at this time.