If You’re Gonna Steal, Keep it Off The Gram
14 May, 2020
A reality TV personality who stars in Love & Hip Hop: Atlanta, has been arrested on federal bank fraud charges arising from a Paycheck Protection Program (PPP) loan that he obtained in the name of Flame Trucking.
Maurice Fayne, aka Arkansas Mo, 37, of Dacula, Georgia, was charged with bank fraud and made his initial appearance this afternoon before U.S. Magistrate Judge Justin S. Anand.
“The defendant allegedly stole money meant to assist hard-hit employees and businesses during these difficult times, and instead greedily used the money to bankroll his lavish purchases of jewelry and other personal items,” said Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division. “The department will remain steadfast in our efforts to root out and prosecute frauds against the Paycheck Protection Program.”
“The defendant allegedly took advantage of the emergency lending provisions of the Paycheck Protection Program that were intended to assist employees and small businesses battered by the Coronavirus,” said U.S. Attorney Byung J. “BJay” Pak of the Northern District of Georgia. “We will investigate and charge anyone who inappropriately diverts these critical funds for their own personal gain.”
“At a time when small businesses are struggling for survival, we cannot tolerate anyone driven by personal greed, who misdirects federal emergency assistance earmarked for keeping businesses afloat,” said Special Agent in Charge Chris Hacker of the FBI’s Atlanta Field Office. “The FBI and our federal partners remain vigilant during this Coronavirus pandemic to make sure funds provided by programs like PPP are used as intended.”
“The defendant allegedly egregiously sought personal gain from a program intended to assist hardworking Americans in this challenging time,” said Special Agent in Charge Kevin Kupperbusch of the Small Business Association Office of Inspector General (SBA OIG) Eastern Region. “SBA OIG and its law enforcement partners will aggressively pursue allegations of wrongdoing to maintain the integrity of SBA’s programs. I want to thank the U.S. Attorney’s Office and our law enforcement partners for their dedication and pursuit of justice.”
According to the charges and other information presented in court, Fayne is the sole owner of a Georgia corporation called Flame Trucking. On April 15, 2020, Fayne signed and submitted to United Community Bank (UCB) a PPP loan application in the name of Flame Trucking stating that the business had 107 employees and an average monthly payroll of $1,490,200. In seeking a loan in the amount of $3,725,500, Fayne certified that the loan proceeds would be used to “retain workers and maintain payroll or make mortgage interest payments, lease payments, and utility payments, as specified under the Paycheck Protection Program Rule.”
UCB ultimately funded the loan for $2,045,800. Within days, Fayne allegedly used more than $1.5 million of the PPP loan proceeds to purchase $85,000 in jewelry, including a Rolex Presidential watch, a diamond bracelet, a 5.73 carat diamond ring for himself, and to pay $40,000 for child support. Such payments are not an authorized use of PPP funds under the CARES Act.
On May 6, 2020, Fayne was interviewed by federal agents and admitted that he submitted a PPP loan application on behalf of Flame Trucking. Fayne claimed that he used all of the PPP loan proceeds to pay payroll and other business expenses incurred by Flame Trucking and denied using any of the PPP loan proceeds to pay his personal debts and expenses.
On May 11, 2020, agents executed a search at Fayne’s residence in Dacula and seized approximately $80,000 in cash, including $9,400 that Fayne had in his pockets, and the jewelry he purchased with the PPP funds, and further discovered a 2019 Rolls-Royce Wraith, which still had a temporary dealer tag on it. Agents also executed seizure warrants for three bank accounts that Fayne owned or controlled and seized approximately $503,000 in PPP funds.
The CARES Act is a federal law enacted on March 29, 2020, designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses, through the PPP. In April 2020, Congress authorized over $300 billion in additional PPP funding.
The PPP allows qualifying small-businesses and other organizations to receive loans with a maturity of two years and an interest rate of 1 percent. PPP loan proceeds must be used by businesses on payroll costs, interest on mortgages, rent, and utilities. The PPP allows the interest and principal to be forgiven if businesses spend the proceeds on these expenses within eight weeks of receipt and use at least 75 percent of the forgiven amount for payroll.
The charges are merely an allegation and the defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Dept. Of Justice
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