Somerset County woman charged with $1 million paycheck protection scheme and economic disaster loan fraud scheme | USAO-NJ

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NEWARK, NJ – A Somerset County, New Jersey woman has been charged for her role in fraudulently obtaining more than $1 million in federal Paycheck Protection Program (PPP) loans and Economic Disaster Loans (EIDL), U.S. Attorney Philip R. Sellinger announced today.

Nivah Garcis, 51, of North Plainfield, New Jersey, is charged by complaint with one count of bank fraud and one count of money laundering. She made her first appearance by video link today before U.S. Magistrate Judge Edward S. Kiel and was released on an unsecured bond of $100,000.

According to documents filed in this case and statements made in court:

Garcis submitted two fraudulent PPP loan applications to a lender on behalf of two purported businesses and three fraudulent EIDL loan applications to the Small Business Administration (SBA) on behalf of three purported businesses.

The CARES Act (Coronavirus Aid, Relief, and Economic Security) is a federal law enacted on March 29, 2020, designed to provide emergency financial assistance to millions of Americans suffering from the economic effects caused by the COVID-19 pandemic. One of the sources of relief provided by the CARES Act was the authorization of up to $349 billion in small business forgivable loans 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 small businesses and other eligible organizations to receive loans with a term of two years and an interest rate of 1%. PPP loan proceeds are to be used by businesses for payroll costs, mortgage interest, rent and utilities. PPP allows for the interest and principal of the PPP loan to be forgiven if the business spends the loan proceeds on these expenses within a specified time after receiving the proceeds and uses at least a certain percentage of the PPP loan proceeds on the expenses. wages. .

The applications Garcis submitted each contained fraudulent statements to the lender — a member of the Federal Home Loan Bank — and the SBA, including false federal tax documents allegedly from the IRS. Garcis also invented the existence of employees and salaries paid through the so-called companies. According to IRS records, however, none of the purported tax documents Garcis submitted in support of his loan applications were ever filed with the IRS. Based on Garcis’ alleged misrepresentations, his loan applications for his purported businesses were approved for approximately $1.05 million in federal COVID-19 emergency relief funds earmarked for struggling small businesses. Garcis then used the proceeds for various personal expenses, including a BMW SUV.

The bank fraud charge carries a maximum sentence of 30 years in prison and a $1 million fine. The money laundering count faces a potential maximum sentence of 10 years in prison and a maximum fine of $250,000 or double the gross gain to the defendant or the gross loss to the victim, depending on the highest value.

U.S. Attorney Sellinger credited special agents from the Social Security Administration, Office of Inspector General, under Special Agent in Charge Sharon MacDermott; IRS Special Agents – Criminal Investigation, under Special Agent in Charge Michael Montanez; Special Agents of the United States Attorney’s Office for the District of New Jersey, under the direction of Special Agent in Charge Thomas Mahoney; the postal inspectors of the United States Postal Inspection Service, under the direction of the inspector in charge a.i. Raimundo Marrero; Federal Housing Finance Agency Special Agents, Office of Inspector General, under Special Agent in Charge Robert Manchak; Special Agents of the Board of Governors of the Federal Reserve System and the Consumer Financial Protection Bureau, Office of the Inspector General, under Acting Special Agent in Charge Stephen Donnelly; Federal Deposit Insurance Corporation Special Agents – Office of Inspector General, under Special Agent in Charge Patricia Tarasca in New York; and special agents from the Department of Homeland Security, Homeland Security Investigations, under Jason J. Molina in Newark, the investigation leading to the charges.

The government is represented by Assistant U.S. Attorneys Katherine M. Romano and David E. Dauenheimer of the Government Fraud Unit at the U.S. Attorney’s Office in Newark.

Anyone with information about alleged attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Disaster Fraud Center hotline at 866-720 -5721 or through the NCDF’s online complaint form at: https://www.justice. gov/disaster-fraud/ncdf-disaster-complaint-form.

The charges and allegations contained in the Complaint are charges only and the Defendant is presumed innocent until proven guilty.

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