4 days ago
Feds bust South Florida ring that collected $34 million in US loans during pandemic
At the peak of the pandemic, a ring of South Floridians jumped on the federal relief bandwagon and applied for more than $34 million in loans from the Small Business Administration to help them survive the public health crisis.
Now, six ring members have been indicted on conspiracy, wire fraud and money laundering charges after the SBA guaranteed more than 90 of their bank-approved business loans between 2020 and 2021, federal prosecutors said Thursday.
A grand jury indictment has charged the six defendants — Elaine A. Escoe, 40; Alfred L. Davis, 51; Gino J. Jourdan, 37; Cher L. Davis, 53; Latoya T. Clark, 39; and James G. McGhow, 69, — with scheming to obtain federal COVID-19 relief funds for their companies in Miami-Dade, Broward and Palm Beach counties. The indictment says their loan applications contained falsified employee numbers, payroll expenses and business revenues, along with fabricated tax documents and bank statements.
As a result, the SBA authorized disbursements of about $29 million in Paycheck Protection Program loans and millions in other federal relief funds that the defendants allegedly spent on themselves, according to prosecutor Jonathan Bailyn. If convicted, the defendants face several years in prison.
Since the pandemic, federal prosecutors have brought fraud charges against more than 3,200 defendants nationwide — including over 250 in South Florida, the worst-hit region — for stealing over $1.7 billion from the approved pandemic loan programs, according to the Justice Department. Congress approved the emergency programs, with about $800 billion in loans, to help struggling businesses meet payroll and other expenses.
Among the loan-fraud suspects that popped up on South Florida's radar was Andre Lorquet, whose case led federal investigators to the probe of the six recently charged ring members.
Before the pandemic, Lorquet opened a business, Miami ENT, and after COVID-19 swept the nation in March 2020, he used the company to amass a small fortune by obtaining PPP and other federal loans totaling $4.4 million. He spent more than $600,000 on two Teslas, a Lamborghini Urus and a Porsche Panamera GTS, according to Homeland Security Investigations.
At his sentencing last year, Bailyn, the prosecutor, described Lorquet as a greedy criminal who fleeced his country at one of its weakest moments in history. Lorquet was sentenced to six years.
'We were in the middle of a pandemic and a national crisis,' Bailyn said. 'There were many people who saw this as an opportunity for charity; this defendant saw it as an opportunity for exploitation and opportunism.'
