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A defense contractor in Hawaii has been charged with bank fraud and money laundering for stealing more than $12.8 million in Paycheck Protection Program (PPP) money.
Martin Kao, CEO of Martin Defense Group LLC, previously known as Navatek LLC, is being arrested on two counts of bank fraud and five counts of money laundering. He is accused of at least two fraudulent PPP loan applications.
Out of the $12.8 million he received, Kao transferred more than $2 million into his own personal accounts, a criminal complaint said.
"According to the charges, Kao falsely inflated the number of employees on the loan application and falsely certified that the applicant and its affiliates would not receive, and had not received, another PPP loan," the U.S. attorney's office in Hawaii said in a statement.
The PPP is a program established by Congress in March that provides forgivable loans to small businesses impacted by the coronavirus pandemic. Kao is one of dozens of people who have been charged with fraudulently obtaining millions of dollars from the PPP through the program.
Democrats on the House Select Subcommittee on the Coronavirus Crisis said last week that more than $3 billion in loans issued through the coronavirus emergency relief program for small businesses may have gone to firms that already received support or should have been excluded from the program.
Lawmakers are continuing to negotiate another coronavirus stimulus bill, which will likely at least partially replenish the PPP.
(THE HILL)
