In short
- Chatman prepared or approved fraudulent PPP loan applications for almost twenty individuals, with funds requested exceeding $400,000.
- He received approximately 5% of each loan, or about $1,000 per application, and obstructed the investigation by disposing of client lists.
What happened
Dommonick T. Chatman, a York tax preparer, was sentenced to 18 months’ imprisonment and ordered to pay $341,438.82 in restitution for bank fraud related to fraudulent PPP loan applications. He admitted to preparing or approving applications for almost twenty individuals, with funds requested exceeding $400,000 and disbursed funds totaling approximately $341,438.82.
Chatman received about $1,000 per loan application, sharing proceeds with employees who assisted. He also obstructed the government’s investigation by disposing of a handwritten list of clients who received PPP loan applications. The case was investigated by the FBI and the U.S. Department of the Treasury, Office of Inspector General.
Chatman also obstructed the government’s investigation by disposing of a handwritten list of the names of clients who had received PPP loan applications through his company.
In numbers
- 18 months prison sentence for Dommonick T. Chatman
- $341,438.82 restitution ordered to the U.S. Government
- $400,000 total funds requested in fraudulent PPP loan applications
What compliance teams should check
- Review PPP loan applications submitted through The Chatman Group, LLC for compliance with PPP rules regarding business existence and income requirements.
- Audit tax returns prepared for clients of The Chatman Group who received PPP loans to identify inconsistencies or fraudulent claims.
- Check for evidence of document disposal or obstruction related to PPP loan applications processed by The Chatman Group, LLC.
Why it matters
This case highlights the risks of fraudulent PPP loan applications facilitated by tax preparers and the importance of verifying business existence and income claims. Compliance officers should be alert to schemes where preparers receive a percentage of loan proceeds and may obstruct investigations by destroying evidence. The prosecution and restitution ordered underscore the need for robust controls and cooperation with authorities to detect and prevent similar frauds, especially in pandemic-related relief programs.
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