A Dallas-area man and a Chicago woman are accused of obtaining more than $11 million in fraudulent pandemic-relief loans through hundreds of applications, according to federal prosecutors.
A federal grand jury indicted Dushawn Nelson, 50, who lives in Dallas and Irving, and Katrina Dorsey, 50, of Chicago, on Aug. 19. Each faces one count of conspiracy to commit wire fraud and four counts of wire fraud, the U.S. Attorney’s Office for the Northern District of Texas announced Friday.
Prosecutors allege the pair submitted or helped submit hundreds of fraudulent Paycheck Protection Program loan applications between June 2020 and September 2022.
The PPP was created during the COVID-19 pandemic to provide forgivable loans to small businesses struggling financially.
According to the indictment, Dorsey allegedly prepared applications using fabricated financial information and fictitious IRS Schedule C forms. Many of the applications claimed borrowers had earned $100,000 in gross income in 2019 regardless of their actual earnings, prosecutors said.
Nelson allegedly referred people to Dorsey in exchange for kickbacks before eventually submitting loan applications himself.
About 560 loans totaling roughly $11.05 million were ultimately funded, according to prosecutors. Individual loans were generally about $20,800.
Applicants then allegedly paid kickbacks of between $2,000 and $5,000 to Dorsey, Nelson or other alleged co-conspirators, often through cash or electronic payments
If convicted, each defendant could face up to 20 years in federal prison, a fine of up to $250,000 and up to three years of supervised release.
The U.S. Railroad Retirement Board Office of Inspector General and the FBI’s Chicago Field Office investigated the case.