Five individuals, including Bear and Middletown residents, were charged for their roles in obtaining federal Paycheck Protection Program (PPP) loans and Economic Injury Disaster Loans (EIDL. Prosecutors said the multi-state scheme involved laundering loan proceeds.
Adrienne Ponzo, 48, of Bear, is charged with one count of conspiracy to commit wire fraud and remains at large. James Wessels, 53, of Middletown is charged with one count of conspiracy to commit money laundering. He was released on a $100,000 unsecured bond.
According to documents and statements made in court:
One of the defendents conspired with Ponzo and others to defraud the economic injury loan program. The scheme recruited individuals who owned businesses with minimal operations, employees, revenues, and profits and introduced them to Ponzo, who prepared fraudulent applications for these businesses and caused them to be electronically submitted to the Small Business Administration.
In another case, Wessels worked with defendants to structure the PPP loan proceeds and paperwork to conceal proceeds being spent on non-payroll expenses. Wessels is alleged to have created fake payroll checks.
The complex case handled by the U.S. Attorney’s office in Camden, NJ and involved work by agents from the Federal Deposit Insurance Corporation, the FBI, Social Security Administration, U.S. Department of Labor.
The PPP program was formed to aid businesses hit by the Covid-19 pandemic. The program provided loans for companies that retained staff with the opportunity for the loans to be forgiven. The economic injury program also aided businesses affected by the pandemic.
There had been warnings that the program would lead to widespread fraud, due its fast-track nature. Other business owners were denied or received minimal loans, in some cases due to the lack of a banking relationship. Changes were made to the program in an effort to reach eligible businesses.
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