(WWJ) – An Oakland County man has pleaded guilty to stealing nearly $1 million – loan money that was meant to help small businesses stay afloat in the midst of the COVID-19 pandemic – and spending it on a variety of purchases, including a personal watercraft.
Ryan Carruthers of Commerce Township, admitted in federal court Monday to orchestrating a fraud scheme that netted about $850,000 in loans from two pandemic relief programs overseen by the Small Business Administration.
As Carruthers, 32, pleaded guilty to one count of wire fraud, U.S. Attorney Dawn Ison said every dollar he stole was “a dollar that did not go to a small business that needed help during the pandemic.”
Back in April 2020, according to Ison’s office, Carruthers began submitting electronic applications for pandemic relief loans in the names of various business entities he purported to own.
Over the next year, he submitted 12 loan applications through the “Paycheck Protection Program” (PPP), which was an SBA-administered program that provided forgivable loans to businesses to encourage them to keep workers employed during the pandemic.
Carruthers also submitted a loan application under the SBA’s ‘’Economic Injury Disaster Loan Program” (EIDL), which was a program that provided low-interest financing to businesses adversely affected by the pandemic.
Authorities say the loan applications “contained numerous material misrepresentations and false statements.” In reality, his purported business entities were shell companies that existed on paper only – they had no revenue, employees, or ongoing operations of any sort.
But he claimed in his applications that each of these entities had between 3-15 employees. The average monthly payroll amounts included in the applications were fictitious, as were representations about how the money would be spent.
Ison’s office says Carruthers received about $851,963 from the 13 loans and he used that money to, among other things, pay off his mortgage, buy a personal watercraft – aka “jetski” – and pay various personal expenses.
Carruthers received approximately $851,963 in proceeds from the 13 loans that were funded as part of his scheme. According to the plea documents, Carruthers used these fraudulently obtained monies to, among other things, pay off the mortgage on his home, purchase a personal watercraft, and pay various personal expenses.
He is set to be sentenced in December.
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