The owner of a Pennsylvania trucking company is facing wire fraud and money laundering charges after federal prosecutors claim he used $467,000 in funds obtained through the U.S. Small Business Administration’s Paycheck Protection Program (PPP) to purchase a residential property, two vehicles and stock market investments.
Federal prosecutors claim Keith McConnell, 43, of Carlisle, Pennsylvania, submitted fraudulent PPP loan applications and forged documents on behalf of his defunct Carlisle-based trucking company, KB Transportation LLC, the Department of Justice said in a statement on Friday.
Atlanta-based Kabbage Inc. approved McConnell’s first PPP loan application for $312,000 in June 2020. McConnell claimed his trucking company had 26 employees and had monthly payroll expenses of nearly $125,000. However, prosecutors claim McConnell’s trucking company didn’t operate in 2019 or 2020 and had no employees or payroll expenses.
After receiving his PPP loan, prosecutors allege he went on a personal spending spree, purchasing a house, two vehicles and investing in the stock market.
“Covid relief fraud is a high priority for our office and the Department of Justice,” Acting U.S. Attorney Bruce D. Brandler said. “These funds were meant to help small businesses survive the pandemic, not for fraudsters to support an opulent lifestyle.”
Seven months after receiving his first round of PPP funds, McConnell applied for a second loan for $155,200 in January 2021. However, those funds were never disbursed, according to the DOJ.
McConnell faces up to 30 years in prison.
Forgivable loans through the PPP, administered by the Small Business Administration, started out with $350 billion in the CARES Act signed by former President Donald Trump in late March 2020 and were reupped in April 2020 with an additional $320 billion. The third round of funding, $284 billion in forgivable PPP loans through the SBA, opened up to lenders in January.
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Chaquita Ruffin
I feel that as long as the money was used for bills and not on games and things of that nature then no criminal charges should be filed I think that instead of locking them up they should be allowed to pay the money back.
Dan Celeste
How will he possibly pay back those funds? Article claims his trucking company didn’t operate I. 2019 & 2020..
Dennis Hubert
I really own a company since 2008, needed the ppp money, and was declined. I had to lay my employees off and they are unemployed. So do I feel sorry for him, no I feel sorry for the system.
Rose C
This what happens when you give all the small business ppp money to ppl that didn’t really lose anything. And leave us ppl that really needed it out. OH WELL🤷🏽♀️ Who Cares