Individual Copied List of Names off the Internet and Claimed Them as Employees
A Maud, Texas man has been sentenced for federal violations related to a COVID-relief fraud scheme in the Eastern District of Texas, announced U.S. Attorney Brit Featherston today.
Samuel Morgan Yates, 35, pleaded guilty on May 6, 2022, to wire fraud and was sentenced to 68 months in federal prison today by U.S. District Judge Robert W. Schroeder, III. Yates was also ordered to pay $1,066,432 in monetary penalties for restitution and forfeiture. According to court documents, Yates made two fraudulent applications to two different lenders for loans guaranteed by the SBA for COVID-19 relief through the Paycheck Protection Program (PPP). In the application submitted to the first lender, Yates sought $5 million in PPP loan proceeds by fraudulently claiming to have over 400 employees with an average monthly payroll of more than $2 million. In the second application, Yates claimed to employ over 100 individuals and was able to obtain a loan of over $500,000. With each application, Yates submitted a list of purported employees that he obtained from a publicly available random name generator on the internet. He also submitted forged tax documents with each application.
