NRI Rahul Shah of Chicago, Charged over $440,000 Loan with Bank PPP Application COVID-Relief Fraud
Chicago, June. 19, 2020
NRIpress.club/Ramesh/ A.Gary Singh
Rahul Shah, 51, of Evanston, Illinois Business Owner of several information technology companies based in the Chicago area has been charged in a complaint with allegedly filing a bank loan application fraudulently seeking more than $400,000 in a forgivable Paycheck Protection Program (PPP) loan guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security (CARES) Act.
Rahul Shah allegedly caused to be submitted to a federally-insured bank an application for a $441,138 loan that was guaranteed by the SBA which significantly overstated the payroll expenses of a company that he controlled.
Shah was charged in a federal criminal complaint filed in the Northern District of Illinois with bank fraud and making false statements to a financial institution.
- Shah signed and caused to be submitted to the lender what purported to be IRS Forms 941 representing his company’s quarterly payroll expenses for 2019.
- A comparison between the documents submitted to the lender and the company’s IRS filings revealed that Shah’s company reported significantly lower payroll expenses to the IRS.
About Rahul Shah:
- Shah is the founder and chief executive officer of Katalyst Technologies, Inc., and Boardshare LLC.
- Both companies have offices at 500 Davis St. in downtown Evanston.
- According to https://patch.com/illinois/evanston/evanston-ceo-charged-bank-fraud-over-ppp-loan-application:
- Shah founded Katalyst in 2000, and the company has since grown at an annual rate of 25 percent a year.
- In addition to its Evanston headquarters, the company operates offices in Atlanta, London and multiple cities in India,
The Coronavirus Aid, Relief, and Economic Security Act, also known as the CARES Act, is a law intended to address the economic fallout of the COVID-19 pandemic in the United States.
- The CARES Act is a federal law enacted on March 29, 2020, designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic.
- The CARES Act was the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses, through the PPP. In April 2020, Congress authorized over $300 billion in additional PPP funding.
- PPP loan proceeds must be used by businesses on payroll costs, interest on mortgages, rent, and utilities.