Man pleads guilty to COVID-19 fraud scheme, spent thousands at casinos
Court records show the Henrico man accepted over $1.1 million in PPP loans
RICHMOND, Va. (WWBT) - A man from Henrico pleaded guilty Wednesday to defrauding the Paycheck Protection Program loans, accepting over $1.1 million on behalf of two defunct companies he owned.
Court documents say throughout 2020 and 2021, Kortney T. Kelley, 45, filed at least four fraudulent applications for PPP loans on behalf of his two non-operational companies. Kelley made numerous false representations and certifications about the operation on these applications, including that the companies, with no actual employees, employed more than 140 workers and paid out over $220,000 in monthly payroll expenses.
He also submitted forged tax returns and other generated documentation purporting to substantiate his false claims that his companies paid payroll expenses.
Kelley spent the money on purposes unrelated to what the Small Business Administration (SBA) allows. Court records show that Kelley spent at least $142,711 in loan proceeds at various casinos and on gaming and transferred at least $834,077 to his personal brokerage accounts.
Kelley made further false statements to the SBA in a loan forgiveness application, which resulted in him not having to pay back the loans.
Kelley also defrauded other COVID-19-related assistance programs, according to court records. He submitted a separate fraudulent application under the Economic Injury Disaster Loan (EIDL) program to the SBA on behalf of one of his defunct companies with a false certification that the money would be used exclusively on business expenses.
As a result, the SBA gave $10,000 to Kelley’s business bank account.
He also submitted fraudulent claims to the Virginia Employment Commission for unemployment benefits. The application falsely stated that Kelley was laid off from his job as a sales manager of a company that he owned.
Kelley is scheduled to be sentenced on May 31. He faces a maximum penalty of 20 years in prison.
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