Phoenix man sentenced to 15 months in prison for $1M COVID-19 relief fraud scheme

A Phoenix man who fraudulently collected more than $1 million in Paycheck Protection Program (PPP) loans during the COVID-19 pandemic was sentenced to federal prison on Wednesday.

Jamar Johnson, 54, was sentenced to 15 months in prison, followed by three years of supervised release. Johnson previously pleaded guilty to wire fraud.

According to federal prosecutors, Johnson submitted fraudulent applications to obtain PPP loans on behalf of his entity, CBL Worldwide II.

In one application, Johnson falsely claimed the business employed 73 people and had an annual payroll expense exceeding $4.8 million. In reality, CBL Worldwide II had zero employees and no payroll expenses.

As a result of the false misrepresentations, Johnson received two separate PPP loans totaling $1,007,650.

Instead of using the funds for business operations, Johnson spent the money on personal expenses, including purchasing cryptocurrency, a vehicle and cosmetic dentistry.

At sentencing, Johnson was ordered to pay full restitution to the Small Business Administration (SBA).

The PPP program was part of a $2 trillion economic package Congress approved in March 2020 to provide emergency financial relief during the COVID-19 pandemic lockdowns.

The program offered hundreds of billions of dollars in forgivable loans to small businesses specifically intended for job retention and payroll support.

Homeland Security Investigations investigated the case with assistance from the SBA Office of Inspector General.

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