A 24-year-old self-proclaimed “serial entrepreneur” is accused of fraudulently soliciting more than $ 7 million in federal wage funds by claiming his Manhattan company employed more than 200 employees, the Department of Justice announced Tuesday.
Sheng-Wen Cheng, 24, is charged with various counts of fraud, including major United States fraud, wire fraud, and bank fraud, as well as one count of fraudulent identity theft for forging the electronic signature of a payroll employee in payment documents provided to financial institutions.
In the criminal complaint that was not declared in federal court in Manhattan on Tuesday, the DOJ said that Cheng claimed that he ran five companies with a monthly salary of $ 1.5 million, and submitted paperwork for the loans for Payroll Protection Program that includes a list of more than 90 employees including “current and former athletes, artists, actors, and public figures” including “a co-anchor on Good Morning America, a former National Football League player, and a leading Penn State football coach who is now deceased, “the DOJ said. In fact, Cheng’s companies employed 14 people.
The PPP loans were established by the U.S. Small Business Administration to cover labor costs and other expenses during the pandemic.
A Taiwanese citizen who was in the United States on a student visa expired in June, Cheng also used the aliases “Justin Cheng,” a / k / a “Justin Jung,” and the identities of other people in his PPP applications. Cheng’s affiliated companies were consulting firms and microfinance named Alchemy Finance, Inc., Alchemy Guarantor LLC d / b / a “Celer Offer,” Celeri Network Inc., Celeri Treasury LLC, and Wynston York LLC, the DOJ said.
In his application, Cheng allegedly submitted “fraudulent and doctored tax records that were never actually submitted to the IRS, and payment records that contained the forged electronic signature of an employee of a payroll company,” the DOJ said.
His alleged ruse worked for a while – Cheng was approved for $ 3.7 million in PPP loans and had received $ 2.8 million before his arrest Tuesday. Of the money paid out, the DOJ said it transferred more than $ 880,000 abroad, withdrew about $ 360,000 in cash and / or cash from cash, and spent more than $ 275,000, including buying a $ 40,000 18-carat gold Rolex watch, rent a luxury $ 17,000 a month condo, and a Maybach S560 sedan, the DOJ said.
“At a time when so many small businesses and their employees are having too little financial trouble, Sheng-Wen Cheng apparently did not see an emergency lifeline, but a proper train,” Acting U.S. Attorney Audrey Strauss said in a release.
Cheng faces up to 30 years in prison if convicted on the top count.
