A federal grand jury indicted a Springfield business owner for fraudulently obtaining $316,062 in Paycheck Protection Program (PPP) loans under the Coronavirus Aid, Relief, and Economic Security (CARES) Act and for laundering more than $35,000 in PPP funds.
Jason L. Hemingway, 47, was charged with two counts each of bank fraud and making a false statement on a loan application, and three counts of money laundering.
Court documents say that Hemingway applied for a PPP loan for his business, Principal Transfer Group, LLC, on Feb. 9, 2021. The CARES Act established several new temporary programs and expanded others to address the COVID-19 pandemic. Among these programs, the Paycheck Protection Program (PPP) authorized forgivable loans to small businesses to retain workers and maintain payroll, make mortgage interest payments, lease payments, and utility payments.
In his electronically submitted loan application, Hemingway claimed that another individual owned his business, Principal Transfer Group, LLC, and stated that the business had an average monthly payroll of $63,212 and employed 25 people, all of which were false. Hemingway signed the application in the name of the individual he claimed was the president and owner. Hemingway received $158,031 in PPP proceeds.
On April 8, 2021, Hemingway applied for a second PPP loan on behalf of Principal Transfer Group, LLC. In that application, again submitted under another individual’s name, Hemingway certified that he had received a previous PPP loan and had used the full loan amount for eligible expenses only, which was false. He again claimed that another individual was the president and owner, that the business had an average monthly payroll of $63,212, and that it employed eight people, all of which were false. Hemingway signed the application in the name of the individual he claimed was the president and owner and received another $158,031 in PPP loan proceeds.
The indictment alleges that Hemingway used the PPP proceeds for non-approved purposes, including for his personal benefit. According to the indictment, Hemingway transferred $11,000 of the PPP funds into the bank account of another business he owned, 417 Print Shop, LLC; an additional $11,000 in PPP funds into his personal bank account; and $13,851.16 of PPP funds into his Robinhood account. Robinhood is a financial services company that allows users to invest and trade in stocks and cryptocurrencies.
The indictment also contains a forfeiture allegation, which would require Hemingway to forfeit to the government any property derived from the alleged fraud scheme, including a money judgment of at least $316,062, and an additional $35,851.16 money judgment for proceeds derived from the alleged money laundering scheme.
The charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
Assistant U.S. Attorney Casey Clark is prosecuting this case. The IRS-Criminal Investigation and the Federal Bureau of Investigation investigated it.