3 Michigan Residents Charged In $11 Million Fraud Scheme
By Hannah DeRuyter
July 23, 2021
Three Michigan residents have been charged for being part of an $11 million fraud scheme involving 22 people in total.
In a news release, The U.S. Department of Justice said between May and August of 2020, the defendants allegedly submitted or took part in helping submit 14 Paycheck Protection Program loan applications for $800,000 each.
According to The Detroit News, to receive the PPP loans, the defendants allegedly submitted fraudulent IRS Form 941s. The forms are used to report income taxes, Social Security tax, or Medicare tax withheld from employee's paychecks.
PPP loans were an incentive for small businesses to keep their workers on payroll during the pandemic. However, when the defendants received the loans, they allegedly hid how they distributed the money.
The Justice Department stated that the loans were used to buy jewelry, personal items and luxury vehicles. The vehicles purchased included two Range Rovers, an Acura NSX and a Mercedes Benz S-Class S65 AMG.
The three Michigan residents charged are Ricky Dixon, Derek Parker and Charmaine Redding.
Here is what the news release said about each Michigan resident charged in the case:
"Ricky Dixon, 52, of Warren, Michigan, is charged with conspiracy to commit bank fraud and wire fraud, bank fraud, wire fraud, false statements to a federally insured financial institution, aggravated identity theft, and money laundering in connection with his involvement in the loan obtained by his business, RK Painting Co., and several other businesses' loans."
"Derek Parker, 56, of Rochester Hills, Michigan, is charged with conspiracy to commit wire fraud, wire fraud, and money laundering in connection with the loan obtained by his business, D Parker Holdings Inc."
"Charmaine Redding, 27, of Macomb, Michigan, is charged with conspiracy to commit wire fraud in connection with the loan obtained by her business, All Star Room and Board Services of Michigan Inc."
The report also says that Dixon faces an additional two-year sentence on the aggravated identity theft charge and Redding pleaded guilty on one count of conspiracy to commit wire fraud in connection with the loan obtained by her business. Her sentencing is set for October 21.
"If convicted, the defendants face a maximum penalty of 20 years in prison on the wire fraud and money laundering charges and a maximum of 30 years on the bank fraud and false statement to a federally insured bank charge," the report noted.