SBA Employee Accused of Executing $435,000 EIDL Fraud Scheme – Fraud Friday
August 30, 2024
Delaney Sexton
Contributing Editor
SBA Employee Accused of Executing $435,000 EIDL Fraud Scheme – Fraud Friday
During the pandemic, Faruk Syed was employed at the SBA as a loan specialist working on COVID Economic Injury Disaster Loans. His responsibilities included reviewing COVID EIDL applications and approving the loans. Now, Syed is accused of submitting fraudulent EIDL applications seeking hundreds of thousands of dollars and using his position at the SBA to approve the fraudulent loan applications.
Starting in April 2020, Syed and others submitted an EIDL application containing false and fraudulent material pretenses, representations, and promises. The loan application was accompanied by falsified and fraudulent supporting documentation. In September 2020, Syed allegedly approved that same loan application, resulting in $143,500 being deposited into a financial institution account owned and controlled by Syed and his co-conspirators.
In August 2020, Syed and his co-conspirators submitted another EIDL application containing false information, and the next day, Syed approved the loan. Syed and his co-conspirators received $147,500 in loan proceeds from this loan.
The scheme was once again repeated in September 2020. They allegedly submitted another fraudulent loan application which Syed approved using his position at SBA. Their fraudulent act was not met with the same success because SBA flagged the loan application as suspected fraud and did not fund the $143,800 EIDL.
Upon receiving the loan proceeds, he allegedly laundered the money through his Fidelity Investment account and used the money for personal expenses.
Syed is being charged with one count of conspiracy to commit wire fraud and one count of conspiracy to commit money laundering.