Fraud Friday – Former Kansas Lawmaker Pleads Not Guilty to 19 COVID Fraud Charges

September 24, 2021

Delaney Sexton
Contributing Editor

Fraud Friday – Former Kansas Lawmaker Pleads Not Guilty to 19 COVID Fraud Charges

Michael Capps was indicted on September 9th for PPP and EIDL fraud. The former member of the Kansas House of Representatives’ charges include:

• one count of making a false statement to a bank for a PPP loan
• one count of bank fraud in connection with a PPP loan
• three counts of false statements to the SBA for EIDL loans
• three counts of wire fraud in connection with EIDL loans from the SBA
• two counts of wire fraud in connection with grants from the Kansas Department of Commerce
• one count of wire fraud in connection with a grant from Sedgwick County
• eight counts of money laundering

It is alleged that Michael falsely represented the number of employees, payroll, and gross revenue of three of his companies. The Midwest Business Group, LLC supposedly had eight employees, a $380k eligible payroll, and gross revenue of $252k. This company was approved for an $80.5k PPP loan and a $114.7k Economic Injury Disaster Loan. In addition, Midwest received a $20k Working Capital Grant from the Kansas Department of Commerce (KDOC) and a $5,000 Sedgwick (Sedgwick County) Cares Grant.

His second company, Krivacy, LLC, received a $149.9k EIDL loan and a $20,000 Working Capital Grant from the KDOC. Capps claimed Krivacy had 18 employees and gross revenue of over $728k.

Fourth & Long Foundation, a nonprofit organization ran by Capps, was approved for an $84.4k EIDL loan. The foundation was said to have 12 employees and gross revenue of $285k.

On Wednesday, Michael Capps pled not guilty during his arraignment but maintained the right to remain released on a $25k unsecured bond. The Magistrate required him to surrender his passport and get fingerprinted at the U.S. Marshal’s service while he waits for his trial. He was never arrested or detained in relation to this case.

These charges carry a maximum sentence of almost 300 years in prison and fines of up to $10.75 million if found guilty.

Source:
Indictment
DOJ Press Release