Feds allege defendants in SC scheme got $396,875 in illegal COVID-19 business aid

Seven defendants from South Carolina and Georgia have been charged with conspiracy to illegally launder money in connection with an alleged fraud aimed at stealing funds from the federal Paycheck Protection Program (PPP), federal law agencies announced Thursday.

Earlier this year, Congress passed a law to set up the PPP to funnel up to $659 billion in government loans to small businesses suffering financial distress due to the COVID-19 pandemic. The loans, which were mostly supposed to help retain employees, wouldn’t have to be repaid as long as businesses used the money in accordance with the program’s requirements.

The PPP charges announced Thursday grew out of an ongoing drug investigation targeting a Greenville-based group of “high-level heroin and methamphetamine” distributors who were allegedly laundering drug proceeds in a variety of ways, including through trips to Harrah’s Cherokee Casino Resort in western North Carolina, according to a press release and an indictment in the case.

But in May, after the Coronavirus Aid Relief and Economic Security (CARES) Act was passed, directing billions in federal aid to economically distressed businesses hit by the coronavirus, the alleged drug defendants applied for a fake PPP loan to an existing Georgia business called Wild Stylz, a federal indictment in the case unveiled Thursday said.

After providing an unidentified legitimate financial institution with phony papers alleging Wild Stylz needed money to pay employees, the bank gave Wild Stylz some $396,875, U.S. Attorney for South Carolina Peter M. McCoy, Jr., announced Thursday.

An indictment in the case also identifies over $2.1 million in funds which federal agents seized from 12 different bank accounts allegedly associated with both the PPP and drug schemes.

The indictment charges the following individuals with conspiracy to commit wire fraud and conspiracy to commit money laundering:

▪ Henry Duffield, 58, of Belton, South Carolina.

▪ Jeremy Brandon Latourneau, 43, of Spartanburg.

▪ Derick Keane, 43, of Spartanburg.

▪ Lauren Marcel Duhart, 34, of Stonecrest, GA.

▪ Joshua Bernard Smith, 39, of McDonough, GA.

Steve Ronald Lewis, 43, of Snellville, GA.

▪ Christopher J. Agard, 41, of Marietta, GA.

Another defendant, Roosevelt “Rosie” Hunt, of South Carolina, is also charged with money laundering in the case. Hunt is cooperating with federal authorities, court records say.

“Criminals seek to take advantage of dire situations, and it is our job to stand in their way,” McCoy said

“Taxpayer funds from the Paycheck Protection Program were supposed to keep businesses open and provide money for workers during these difficult times,” said Jody Norris, Special Agent in Charge of the Columbia Field Office of the FBI.

The South Carolina indictments a were among 50 PPP-related fraud cases around the nation announced Thursday by the Department of Justice at a press conference in Washington.

This story was originally published September 10, 2020 at 1:23 PM.