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Chad B. Thomas, 41, of Blountville, was sentenced to 40 months imprisonment on August 21 by the Honorable J. Ronnie Greer, U.S. District Judge for the Eastern District of Tennessee at Greeneville.
As part of the plea agreement filed with the court, Thomas agreed to plead guilty to information charging him with one count of wire fraud. Following his incarceration, Thomas will be on supervised release for three years. He was also ordered to repay $307,700 in restitution.
According to court records, in May and July 2020, Thomas submitted three fraudulent Payroll Protection Program (“PPP”) loan applications that included false information about payroll expenses and phony supporting documents. In the spring of 2020,Congress had authorized the issuance of forgivable PPP loans to qualified businesses for use in paying authorized expenses as a legislative response to the COVID-19 pandemic through the CARES Act. Applicants completed and submitted loan applications that described historical payroll information and attached supporting documentation.
Thomas submitted three fraudulent PPP loan applications and obtained a total of $307,700 in fraudulent loan proceeds. As part of his scheme, Thomas submitted false payroll information and included fictitious supporting forms as part of his applications, including IRS forms. For the final loan – a PPP loan in the amount of $207,500 – on May 12, 2020, Thomas incorporated a business named Kingdom of God, Inc. as a religious organization with the Tennessee Secretary of State. On July 6, 2020, Thomas electronically submitted a fraudulent PPP loan application for Kingdom of God, Inc. to a lender in San Diego, Calif. Thomas falsely represented that the company had 26 employees and an average monthly payroll of $83,000. Thomas also included a monthly payroll journal that showed Thomas’ family members, minor children, and several nationally known religious figures were paid employees of Kingdom of God, Inc. Neither the state of Tennessee nor the IRS had any record of Kingdom of God, Inc. ever paying any employees. Kingdom of God, Inc. did no business and was ultimately dissolved by the Tennessee Secretary of State for failure to file reports. The San Diego lender approved the fraudulent loan application, and on July 14, 2020, deposited the sum of $207,500 into a Kingdom of God, Inc. bank account that Thomas had formed.
As part of the investigation, law enforcement seized and administratively forfeited the sum of $161,938.01 from bank accounts Thomas controlled.
The criminal indictment was the result of an investigation by the United States Secret Service. This investigation was led by Special Agents Kay Berry and Thomas Whitehead.