Two South Florida men have pleaded guilty to a scheme to defraud the federal government of $35 million worth of Paycheck Protection Program (PPP) loans guaranteed by the Small Business Administration (SBA) and funded by federal coronavirus relief money.
James R. Stote, 55, of Hollywood and Phillip J. Augustin, 52, of Coral Springs pleaded guilty this week in the Northern District of Ohio for leading a scheme that stretched from Florida to Ohio, the U.S. Department of Justice (DOJ) announced. The two pleaded guilty to conspiracy to commit wire fraud, and each faces up to 20 years in prison.
The scheme began after Stote and Augustin initially applied for a PPP loan with the SBA for Augustin’s company, Clear Vision Music Group LLC, using falsified documents, according to the DOJ. They began recruiting others to apply for loans and in larger amounts, taking a cut.