Kingdom City, Missouri business owner pleads guilty to $673,000 CARES Act fraud

Coronavirus or COVID-19 Scams and Fraud Graphic

A Kingdom City, Mo., business owner pleaded guilty in federal court to fraudulently receiving more than $673,000 in loans for several businesses under the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

Scott Allen Maples, 39, waived his right to a grand jury and pleaded guilty before U.S. Magistrate Judge Willie J. Epps, Jr., to one count of bank fraud.

By pleading guilty, Maples admitted that he fraudulently applied for and received Paycheck Protection Program (PPP) loans for several businesses. When Maples applied for PPP loans, he reported exaggerated and inaccurate payroll expenses and submitted fabricated and altered bank statements and tax forms. Under the CARES Act, both the principal and interest on those loans were eligible for forgiveness if the loan money was spent for permissible expenses (such as payroll, mortgage interest, rent, and utilities) and at least 60 percent of the loan went towards payroll expenses.

After submitting those fraudulent loan applications, Maples received a total of $673,127 in loan proceeds. Under the terms of the plea agreement, Maples must pay restitution and must forfeit to the government $673,127.

Maples admitted that he submitted a loan application to Square, Inc., a company authorized to issue PPP loans, on May 6, 2020, on behalf of Area 23, LLC, claiming 21 employees and an average monthly payroll of $69,548. Maples submitted fabricated documents to support the loan application. He received a $173,872 loan. Maples also submitted a loan application to US Bank on May 15, 2020, for the same business, Area 23, making the same claims of employees and payroll and again including fabricated documents to support the loan application. Maples again received a $173,872 loan.

Maples also received a $51,750 PPP loan for Maples Enterprises through Square. In the loan application, Maples indicated that there were six employees earning a total of $20,700 per month on average. In reality, Department of Labor records reflected that there was only one employee. Another business, Clearance Depot, received a $270,632 PPP loan. Maples submitted statements in support of this loan that were later found to be altered and incorrect.

Maples also submitted an application for an Economic Injury Disaster Loan seeking $30,000. This loan also contained suspected misrepresentations that overstated the prior year’s revenues. Maples received a $3,000 advance on this loan, but the loan that he sought was not issued.

Under federal statutes, Maples is subject to a sentence of up to 30 years in federal prison without parole.