A Clayton, North Carolina man has pleaded guilty to charges stemming from two separate fraud conspiracies, federal prosecutors announced.
Darnell William King, 42, was indicted for his role in fraudulent schemes involving the Paycheck Protection Program (PPP) and the use of stolen identities to obtain lines of credit from private lenders, according to the U.S. Attorney’s Office for the Eastern District of North Carolina.
King pleaded guilty Tuesday to conspiracy to commit bank and wire fraud, aggravated identity theft, and possession of a firearm by a convicted felon.
Federal prosecutors stated that King and other conspirators fraudulently applied for a PPP loan in King’s name. They submitted falsified bank and tax records claiming he was an Uber driver before the pandemic, resulting in the disbursement of over $15,000 in funds guaranteed by the Small Business Administration.
“The Paycheck Protection Program was an essential tool used to support the economy against an unforeseen international health crisis and provide much needed relief for small businesses,” said Acting United States Attorney Daniel P. Bubar. “Instead, King saw the PPP as an opportunity to commit serious fraud and is being held responsible for his crimes because of the good work of IRS-CI and our other federal and state partners.”
In a separate scheme, King and others recruited “mules” to obtain fraudulent personal loans. They created fake driver’s licenses and other identity documents using a photograph of the mule and stolen personally identifying information of victims. These documents were used to obtain personal loans based on online credit applications submitted by King or others.
The mules then delivered the loan proceeds to King or his co-conspirators and received kickbacks ranging from $100 to $2,000.
“This extensive investigation, known as Operation Overload, uncovered a sophisticated criminal enterprise that fraudulently utilized thousands of North Carolina driver licenses, resulting in financial crimes that impacted individuals across multiple states,” said Capt. Talaya Vaughn of the North Carolina DMV License & Theft Bureau. “Bureau commends its inspectors, intelligence analysts, and all partner agencies for their hard work and collaboration. Their efforts underscore the importance of interagency cooperation in combating complex fraud schemes and safeguarding the identities of North Carolina residents.”
During a search warrant execution, law enforcement found King in possession of a firearm, which he is prohibited from possessing due to his status as a convicted felon.
Sentencing will occur later this year before United States District Judge Richard E. Myers, II.
