RICHMOND, Va. (WRIC) — A Richmond man was sentenced to seven years in prison on Thursday for schemes to defraud a COVID-19 relief program and steal funds through altered checks.
According to court documents, 26-year-old Davon Hunter used Instagram and word of mouth to get potential co-conspirators to provide their personal information, so that Hunter could submit fraudulent applications to the Paycheck Protection Program (PPP), a COVID-19 relief program that was intended to provide loans from the Small Business Administration to certain businesses, nonprofit organizations and other entities.
Hunter submitted at least 23 fraudulent PPP loan applications to at least four financial institutions for fake businesses purportedly belonging to himself and 16 other co-conspirators, according to the Department of Justice.
Hunter and his co-conspirators fraudulently obtained over $500,000 in PPP loans.
In exchange for preparing the fraudulent loan applications and supplying falsified supporting documents, Hunter demanded 25 to 50% of each loan obtained by the co-conspirators.
When the PPP loan program ended in 2021, the Department of Justice said Hunter turned to “card cracking” — a scheme to defraud financial institutions through the deposit of fraudulently altered stolen checks from small businesses.
Hunter and his co-conspirators recruited at least 16 accountholders to provide their debit cards and personal identification numbers (PINs).
The group stole legitimate checks from various small businesses, altered the checks to make them payable to accounts controlled by conspirators, and deposited at least 16 altered checks purportedly worth over $150,000, according to the department.
Immediately after these deposits, they carried out successive transactions to quickly access the credited funds before the banks determined the deposits to be worthless.
Despite knowing of the federal investigation, Hunter continued in his card cracking schemes.
At the time of his arrest, the department said Hunter was found to have had two additional altered checks purportedly worth over $27,000, along with several bank cards in the names of other people.
Even though he lacked legitimate income throughout these schemes, the Department of Justice said Hunter “flaunted his fraud proceeds and luxurious lifestyle on social media.”
“His Instagram account and bank records reflect postings with thousands of dollars in cash and money orders and expenditures for expensive jewelry, $26,000 purportedly for veneers, gambling, the purchase of luxury goods and clothing from Dior, Saks, Louis Vuitton, Chanel and more, attendance at professional sports events, trips and vacations throughout the country, and the purchase of a Range Rover,” said Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia.
On Oct. 31, 2023, Hunter pleaded guilty to one count each of conspiracy to commit wire fraud and conspiracy to commit bank fraud.
A separate hearing to determine Hunter’s restitution and forfeiture obligations will take place on May 14.
