What to Know
- An attorney in New Jersey has been indicted with multiple counts of bank fraud and other crimes for allegedly obtaining, fraudulently, nearly $9 million in federal Paycheck Protection Program (PPP), according to prosecutors.
- Choi subsequently used the PPP loan proceeds to pay for personal expenses, including a nearly $1 million home in Cresskill, fund approximately $30,000 in remodeling and other improvements, and invest millions in the stock market through an account held in his spouse's name, according to federal prosecutors.
- The Paycheck Protection Program represents billions of dollars in forgivable small business loans for Americans struggling because of the COVID-19 pandemic. It's part of the Coronavirus Aid, Relief and Economic Security Act, which became federal law in March.
An attorney in New Jersey has been indicted with multiple counts of bank fraud and other crimes for allegedly obtaining, fraudulently, nearly $9 million in federal Paycheck Protection Program (PPP), according to prosecutors.
Jae H. Choi, 48 and of Cliffside Park, was indicted Tuesday with four counts of bank fraud, four counts of false statements on a loan application, one count of aggravated identity theft, and one count of money laundering, U.S. Attorney Craig Carpenito and Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division jointly announced Wednesday.
Attorney information for Choi was not immediately known. It was unclear if Choi will be representing himself or if he retained an attorney.
According to documents filed in this case, Choi submitted four allegedly fraudulent PPP loan applications to four lenders on behalf of four businesses that supposedly provided educational services. According to court documents, Choi lied about the companies employing hundreds of employees, manipulated bank and tax records, and falsified a driver’s license on the applications.
The Paycheck Protection Program represents billions of dollars in forgivable small business loans for Americans struggling because of the COVID-19 pandemic. It's part of the Coronavirus Aid, Relief and Economic Security Act, which became federal law in March.
Additionally, according to court documents, Choi falsely told lenders that his companies, which allegedly employed hundreds of employees had paid over $3 million in monthly wages. In one instance, Choi emailed a lender falsely claiming that he just told 150 of his employees that they were losing their jobs because the PPP loan had not yet come through, and that he had “watched grown men and women crying" and that he "sincerely hope[d]" the lender's employee would never find themselves in the same situation, according to federal prosecutors citing the court documents.
Based on Choi’s fraudulent applications, three of the four lenders funded three of his businesses with about $3 million PPP loan each. In total, Choi received nearly $9 million in federal COVID-19 emergency relief funds that are destined for distressed small businesses, prosecutors said.
Choi subsequently used the PPP loan proceeds to pay for personal expenses, including a nearly $1 million home in Cresskill, fund approximately $30,000 in remodeling and other improvements, and invest millions in the stock market through an account held in his spouse's name, according to federal prosecutors.
The indictment seeks the forfeiture of nearly a dozen bank accounts and one investment account, as well as Choi's purchased Cresskill home.
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An arraignment date has not been set.
