On May 19, 2020, in the Eastern District of Texas, Samuel Yates was charged with wire fraud, bank fraud, false statements to a financial institution, and false statements to the Small Business Administration in connection with the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

According to the court documents, Yates allegedly obtained an Employer Identification Number from the Internal Revenue Service (IRS) in March 2020 in order to document a business to use in fraudulent CARES Act-related loan applications. Yates subsequently made two fraudulent applications to two different lenders. He provided the lenders with IRS forms that were falsified or that included false statements, to make him appear eligible for CARES Act-related funds.

In the application submitted to the first lender, Yates sought more than $5.2 million in loan proceeds, by fraudulently claiming to have 412 employees with an average monthly payroll in excess of $2 million. In the second application, Yates claimed to employ more than 100 individuals and was able to obtain a loan of approximately $533,216.

With each application, Yates submitted a list of names of purported employees that he obtained from a publicly available random name generator. He also included false IRS payroll tax documents in the business name he established in March 2020. These documents contained substantially different numbers for each loan application, despite purporting to be for the same business.

If convicted, Yates could face a fine of up to $1 million and/or 30 years' imprisonment or more.

Source:  The facts in this case narrative come from the following publicly available documents: DOJ Press Rel., issued May 19, 2020 and E.D.Tex. Crim. Comp., filed May 18, 2020.