Newton Man admits role in $ 5.6 million pandemic loan fraud
NORTH JERSEY – A Newton man who received more than $ 5 million in cash from the Paycheck Protection Program, aimed at small businesses affected by the COVID-19 pandemic, pleaded guilty to a federal judge last Thursday during of his hearing for bank fraud and money laundering.
Azhar Sarwar Rana, 30, who was arrested on December 12 – the same day he booked a flight to Pakistan – was accused of falsifying salary and tax documents which he handed over to a bank in a PPP loan application, used to successfully secure $ 5.6 million for his company, Azhar Sarwar Rana LLC, a so-called real estate developer.
The United States District Attorney for New Jersey indicated that in admitting Rana to the judge and accompanying court documents, he claimed to have needed the loan for several employees he paid in 2019 and 2020, but instead paid “hundreds of thousands” into family members’ Pakistani bank accounts, paid personal expenses, made a payment of $ 13,000 to a BMW dealership and invested millions in stocks.
A joint investigation between several entities, including the FBI, IRS, Social Security Administration, Department of Homeland Security and other agencies, revealed after looking at New Jersey Department of Labor records that Rana – who asked a $ 10 million loan on April 6, 2020 – had no paid employees in 2019; and the names of those he allegedly paid in 2020 did not match their social security numbers.
PPP loans, established during the pandemic with $ 300 billion authorized in April 2020, were intended to be used for wage costs for small businesses, as well as for rent, mortgage and utility payments.
Rana, who is due to be sentenced on November 3, could serve up to 30 years in prison and pay a fine of $ 1 million for bank fraud charges; and 10 years and pay a fine of $ 250,000 for allegations of money laundering.
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