U.S. Attorney’s Office joins DOJ Fraud Division, SBA, and SBA-OIG in surge takedown exceeding $245m in COVID-era loan fraud

Date: Sept. 16, 2026

Contact: newsroom@ci.irs.gov

Cleveland – The U.S. Attorney’s Office for the Northern District of Ohio has announced three cases that were part of a nationwide enforcement action led by the Justice Department’s National Fraud Enforcement Division, the Small Business Administration (SBA), and the SBA Office of Inspector General targeting fraud in the SBA’s Paycheck Protection Program (PPP). 

From June 12 to Sept. 1, federal prosecutors across the country facilitated enforcement actions spanning over 160 criminal defendants and reaching approximately $245 million intended loss to American taxpayers. 

“Unfortunately, many individuals saw the economic lifelines meant to help our small businesses as their chance for a cash grab,” said U.S. Attorney David M. Toepfer for the Northern District of Ohio. “Those who lie, deceive, and con their way into obtaining stimulus funds for their personal benefit will be held accountable, and we owe it to every taxpayer to aggressively prosecute these shameless fraudsters.”

“Pandemic loan relief was meant to keep American small businesses alive during government lockdowns—not line the pockets of fraudsters,” said Attorney General Todd Blanche. “The defendants charged during our summer surge allegedly fabricated businesses, submitted false payroll and revenue claims, stole identities, and concealed foreign ties on their applications— but they will now be prosecuted to the fullest extent of the law.”

“This summer surge shows what is possible when dedicated public servants across the country work together with a single purpose,” said Assistant Attorney General Colin M. McDonald of the National Fraud Enforcement Division. “Our mission is clear: protect taxpayer funds, safeguard the integrity of federal relief programs, and deliver justice to those who exploited them. We will remain steadfast every day—standing shoulder-to-shoulder with our partners—to identify fraud, pursue those responsible, and restore confidence in the programs meant to help American small businesses thrive.”

“This announcement represents the largest-ever action against perpetrators of SBA fraud, with 870,000 suspended borrowers tied to $39 billion in suspected fraudulent PPP and COVID EIDL activity. In partnership with Vice President Vance and the White House Task Force to Eliminate Fraud, we’re putting fraudsters on notice: the federal government will no longer turn a blind eye to those who stole from taxpayers and exploited programs designed to sustain small businesses during the pandemic,” said SBA Administrator Kelly Loeffler. “With demand letters going out to suspected fraudsters, we’re also sending a clear message that they must repay their debts or face Treasury collections and possible federal law enforcement. Under this Administration, the free ride is over. We are restoring accountability, recovering taxpayer dollars, and protecting SBA programs for the legitimate small businesses they were created to serve.” 

In the Northern District of Ohio in July, Travius Holloway of Richmond Heights pleaded guilty to one count of wire fraud. He obtained a fraudulent PPP loan for his production company in the amount of $121,865, along with $370,982 worth of fraudulent pandemic-era unemployment benefits, for a total intended loss of approximately $494,847. He is scheduled to be sentenced Oct. 20 and faces up to 20 years in prison. A previously announced case in July charged a Lorain County mother and her two sons with conspiracy to defraud the IRS and pandemic-era programs of more than $5 million, including approximately $337,645 in fraudulent PPP loans. In August, Ralph Faulkner of Jersey City, New Jersey, was charged with obtaining multiple fraudulent PPP and Economic Injury Disaster loans for a purported vodka business. He has since pleaded guilty to causing a loss of approximately $485,541. He faces up to 20 years in prison. A sentencing date is yet to be set.

These cases are being investigated by:

• IRS-Criminal Investigation
• U.S. Department of Labor-Office of the Inspector General
• Small Business Administration-Office of the Inspector General
• U.S. Postal Inspection Service
• FBI Cleveland Division

Assistant United States Attorneys Brenna Fasko, Stephanie Wojtasik, and Erica Barnhill are leading the prosecutions for the Northern District of Ohio.

IRS-CI is the law enforcement arm of the IRS, responsible for conducting financial crime investigations, including tax fraud, narcotics trafficking, money laundering, public corruption, healthcare fraud, identity theft and more. It is the only federal law enforcement agency with investigative jurisdiction over violations of the Internal Revenue Code. IRS-CI has 16 field offices located across the U.S. and maintains an international presence through attaché posts abroad.