A Philly business owner pleaded guilty to using nearly $1 million in PPP loans to buy a house, cars, and jewelry
Devron Brown, 50, admitted that he used fraudulent tax documents to obtain nearly $1 million in coronavirus relief money, then went on a personal spending spree.
The owner of a Philadelphia construction company admitted Tuesday that he used fraudulent tax documents to obtain nearly $1 million in coronavirus relief money, then used the proceeds to buy personal items including a house in Florida, a Lexus, and diamond rings.
Devron Brown, 50, said little while pleading guilty to 11 counts of bank fraud and money laundering before U.S. District Judge Chad F. Kenney. Brown’s lawyer, Geoffrey V. Seay, declined to comment afterward, as did Assistant U.S. Attorney Kathryn Deal.
United States Attorney Jennifer Arbittier Williams said in a statement that Brown stole funds that could have helped other small businesses.
“Thieves who attempt to take these funds are taking advantage of others’ misfortune — ripping them off while also ripping off all taxpayers who fund the program,” she said.
Brown is one of a relatively small number of people who have been charged with defrauding the Paycheck Protection Program (PPP), the federal program of forgivable business loans aimed at helping companies weather the economic challenges caused by the pandemic.
Earlier this year, the Department of Justice said more than 100 people nationwide had been charged in about 70 PPP-related cases. Still, that represents a small slice of the 11.8 million PPP loans that have given businesses nearly $800 billion during the pandemic to help fund payroll and other expenses.
Jennifer Crandall, a spokesperson for Williams’ office, said Brown was the first to be federally charged in this region in such a case.
Brown’s scheme was relatively simple, according to charging documents outlining his case. In June 2020, he submitted fraudulent payroll data and tax information to support a loan application of about $935,000 for his company, Just Us Construction. The loan was approved on June 26, 2020. Within weeks, the documents say, Brown began using the money to buy items for himself and his loved ones.
In July 2020, shortly after his loan was approved, prosecutors say he spent $250,000 on a house in Deltona, Fla., nearly $43,000 to buy his mother a 2017 Lexus GS 350, about $50,000 to purchase a 2018 Ford F350 XLT pickup truck, and $55,000 to buy an excavator.
Later that year, they said, Brown spent about $6,300 on a gold-and-diamond engagement ring and wedding band. He also bought a motorcycle.
In February 2021, when the funds from the loan had nearly run out, Brown tried to apply for another PPP loan but was denied.
He was charged by federal prosecutors in June. Several weeks later, he failed to show up for a bail hearing and did not report to his probation officer, court records show. He was arrested in Florida in August and jailed while awaiting trial.
Brown is scheduled to be sentenced in April. He faces the prospect of spending years in prison.