A Kansas City, Missouri man has admitted in federal court to obtaining a Paycheck Protection Program (PPP) loan of $487,600 through fraudulent means. Lorenzo Boles, 56, pleaded guilty before U.S. District Judge Greg Kays to charges of wire fraud and money laundering.
The PPP was established under the Coronavirus Aid, Relief and Economic Security (CARES) Act to provide financial assistance to small businesses impacted by the COVID-19 pandemic. The CARES Act authorized the Small Business Administration to offer these loans to eligible businesses facing economic disruption.
According to court documents, on April 30, 2020, a co-defendant submitted a PPP loan application for Burnes Family Investments, LLC (BFI), listing Boles as an 82% owner and the co-defendant as an 18% owner. The application claimed that BFI had an average monthly payroll of $195,067 and reported a gross income of $3,910,582 for 2019 with expenses of $3,263,451 and net profit of $647,131. Forms 941 and 944 were also provided as part of the application process.
However, investigators found that the financial figures stated in the profit and loss statement did not match tax returns filed by Boles. Additionally, Forms 941 and 944 had never been filed with the IRS nor were any payments received by the agency as listed on those forms.
On May 8, 2020, BFI received the full PPP loan amount into its bank account. Bank records show that Boles paid himself $50,000 during the month following receipt of funds and ultimately used about $90,000 from the loan for personal expenses.
Boles faces up to 30 years in federal prison without parole under current statutes. However, sentencing will be determined by the court according to advisory guidelines and other legal factors.
The case is being prosecuted by Assistant U.S. Attorney Paul S. Becker following investigations led by Internal Revenue Service – Criminal Investigation and the Kansas City Police Department.
The United States Attorney’s Office for the Western District of Missouri manages federal prosecutions—including cases like this one—and civil litigation across a jurisdiction covering 66 counties from Iowa’s border in northern Missouri down to Arkansas in the south. The office works out of Kansas City as well as Jefferson City and Springfield locations while collaborating with multiple law enforcement agencies at various levels. Its responsibilities include addressing violent crime, drug trafficking issues and financial fraud within western Missouri (official website).
