Texas Man Charged With $1M PPP Loan Fraud Paid to Companies With No Workers

A Texas man has been charged with fraudulently claiming more than $1 million in Paycheck Protection Program (PPP) loans for two companies which have no employees.

Joshua Thomas Argires, 29, of Houston, is accused of making false statements to a financial institution, wire fraud, bank fraud and engaging in unlawful monetary transactions after requesting the money for payrolls for non-existence workers.

After receiving the loan, Argires allegedly invested the money in a cryptocurrency account and put the rest into a bank account before slowly withdrawing it at ATMs, according to U.S. Attorney Ryan K. Patrick's office.

PPP loans are provided via the Coronavirus Aid, Relief and Economic Security (CARES) Act. The loans are forgiven if small businesses use the money to cover payroll costs and interest on mortgage, rent and utilities.

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Prosecutors said the suspect perpetrated a scheme to file two fraudulent loan applications seeking more than $1.1 million in forgivable loans on behalf of two companies: Texas Barbecue and Houston Landscaping.

During his application, Argires allegedly claimed these two companies had numerous employees and hundreds of thousands of dollars in payroll expenses.

According to a criminal complaint, neither Texas Barbecue nor Houston Landscaping has any employees or pays wages consistent within what was claimed in the loan applications.

"The complaint further asserts that both of these loans were funded, but that none of the funds were used for payroll or other expenses authorized under the PPP," Patrick added in a statement.

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Argires appeared in court before U.S. Magistrate Judge Peter Bray on July 13 to face the charges.

The Federal Housing Finance Agency Office of the Inspector General (OIG), SBA OIG and U.S. Postal Inspection Service's Houston Division conducted the investigation. Trial Attorney Timothy A. Duree of the Criminal Division's Fraud Section and Assistant U.S. Attorney James McAlister for the Southern District of Texas are prosecuting the case.

"A federal criminal complaint is merely an accusation," Patrick said. "A defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law."

In April 2020, Congress authorized over $300 billion in additional PPP funding.

According to the Small Business Administration (SBA), more than 4.8 million PPP loans have been approved for small businesses affected by the COVID-19 pandemic up to June 30. In total, $521,483,817,756 have been paid out to companies, which includes money which has since been returned.

More than 20 percent of small businesses received a PPP loan of between $350,000 to $1 million.

atm
A banking customer uses an ATM machine in Ashland, Oregon. A Texas man has been charged with fraudulently claiming more than $1 million in PPP loans. Robert Alexander/Getty
Texas Man Charged With $1M PPP Loan Fraud Paid to Companies With No Workers | U.S.