SDNY COURTHOUSE, July 12 – Amid mounting fraud in the U.S. Paycheck Protection Program, including banks and non-bank fintech lenders refusing to report the most basic data about what they done with the money, an investigative project of Inner City Press, on May 21 there is the arrest of Muge Ma, as known as "Hummer Mars," a Chinese national residing in Manhattan. At 7 pm he was remanded to custody in jail as a risk of flight, see below.
Now it emerges that the June 22 preliminary hearing for Muge Ma was quickly extended a month on consent: "ORDER TO CONTINUE IN THE INTEREST OF JUSTICE as to Muge Ma. Time excluded from 6/22/20 until 7/22/20. Affirmation of AUSA Sagar Ravi. (Signed by Magistrate Judge Gabriel W. Gorenstein)... the Government was initially required to file an indictment or information on or before June 22, 2020; It is further found that Assistant United States Attorney Sagar K. Ravi and Mr. Katz have engaged in discussions concerning a possible disposition of this case and are continuing discussions concerning a possible disposition of this case; It is further found that the Government has requested a continuance to engage in further discussions with defense counsel about the disposition of this case and that the defendant, through counsel, has consented to such a continuance and has specifically waived his right to be charged in an indictment or information for an additional period not to exceed 30 days." Disposition means plea bargaining...
Ma was arrested for a fraudulent scheme to obtain over $20 million in Government-guaranteed loans designed to provide relief to small businesses during the novel coronavirus/COVID-19 pandemic. Inner City Press covered the bail (denial) hearing:
As the presentment of Muge Ma begins, he says, "For many years I have considered myself as American." Ma, charged with defrauding PPP program, graduated from UCLA Anderson School in Management in 2013.
Judge McCarthy (based in White Plains courthouse) asks Ma, Are you a U.S. citizen? Ma: Not yet, Your Honor. Ma is being very obsequious to Judge, thanking her profusely.
AUSA Ravi says Ma lives in a condo in a brand new Manhattan condo, defrauded 5 banks for $20 million under PPP.AUSA Ravi says Ma's statement to agents reflect he may already have #COVID19. His parents were visiting from China in January, stuck here since - but seen with tablets and multiple cell phones in his condo.
Judge McCarthy ruled, This weighs toward remand [to prison]. You have the financial resources to flee to China. There's the sophisticated nature of this crime. Remand.
In connection with loan applications for relief available from the Paycheck Protection Program (“PPP”) and the Economic Injury Disaster Loan (“EIDL”) Program, MA falsely represented to the SBA and five financial institutions that his companies, New York International Capital LLC (“NYIC”) and Hurley Human Resources LLC (“Hurley”), had hundreds of employees and paid millions of dollars in wages to those employees, when, in fact, MA appears to have been the only employee of his companies.
U.S. District Court for the Southern District of New York U.S. Attorney Geoffrey S. Berman said, "Ma allegedly falsely represented in his applications to banks and the SBA to own two companies with hundreds of employees to whom he paid millions in wages. In truth, Ma appears to be the only employee of either company and had no legitimate claim to the funds for which he applied.
SBA OIG Eastern Region Special Agent-in-Charge Kevin Kupperbusch said: “Providing false statements to gain access to SBA’s programs will be aggressively investigated by our office. SBA OIG and its law enforcement partners are poised to root out fraud in SBA’s programs and bring wrongdoers to justice." But SBA has no time to respond to Freedom of Information Act (FOIA) requests?
From at least in or about March 2020 through at least on or about May 15, 2020, MA applied to the SBA and at least five banks for a total of over $20 million in Government-guaranteed loans for the his companies NYIC and Hurley (together, the “Ma Companies”) through the SBA’s PPP and EIDL Program. In connection with these loan applications, MA represented, among other things, that he was the sole owner and executive director of the Ma Companies, that the Ma Companies were located on the sixth floor of his luxury condominium building in New York, New York, and that NYIC and Hurley together had hundreds of employees and paid millions of dollars in wages to those employees on a monthly basis. In fact, however, MA appears to have been the only employee of NYIC since at least in or about 2019, and Hurley does not appear to have any employees... A bank approved and disbursed over approximately $800,000 in PPP loan funds for Hurley, which were frozen in connection with this investigation.
Inner City Press will have more on this, and other investigations. This case is US v. Ma, 20-mj-5202 (Fox).
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