CLEVELAND, Ohio — A Cleveland-area father and son are among nine people accused of conspiring to submit dozens of fake loan applications for $24 million in federal coronavirus-relief funds, according to federal prosecutors.
The group — led by the owner of a Florida talent agency that managed pro football players — submitted more than 90 applications for federal CARES Act money specifically earmarked to help keep small businesses and their employees afloat during the pandemic, court records say.
The group was successful in getting $17.4 million in fraudulent money through 42 of those applications, according to prosecutors.
Business owners inflated their number of employees and the salaries they need to pay out to get more relief money, according to court records.
Six — including the accused ringleader Phillip Augustin of Coral Springs, Florida, and father-son duo Deon and Abdul-Azeem Levy of Cleveland and Bedford, respectively — are charged in federal court in Cleveland and three in the Southern District of Florida. The charges were unsealed on Thursday.
Augustin, the owner of Clear Vision Music Group, filed for and received an $84,515 loan based on fraudulent information he put in the loan application, court records say. He then developed a template for others to do the same, according to prosecutors.
Augustin, 51, recruited several business contacts, including a pro football player identified in court records only as Person 5, to file fake claims and send him kickbacks, according to court records.
During a six-week span, Augustin was paid more than $900,000 in kickbacks, according to prosecutors.
The Levys paid a small amount of kickback to Augustin, according to court filings.
Abdul-Azeem Levy applied for a $554,232 loan while using the personal information of the owner Apex Now Corp., a construction company in Solon, according to court records.
The application directed the funds to a bank account controlled by Abdul-Azeem Levy. His father had unlawful access to that account, according to prosecutors.
Fifth-Third bank, where Levy set up the account to receive the loan, flagged the payment as suspicious.
An FBI agent posing as bank investigators met with Levy on June 5 to discuss the loan. While he was inside the bank, another FBI agent approached Deon Levy, who admitted he instructed his son how to conduct the scheme, court records say.