A St. Thomas man is facing federal charges after investigators say he fraudulently obtained more than $400,000 in COVID-19 Paycheck Protection Program loans, according to a press release from the U.S. Attorney’s Office for the District of the Virgin Islands.
U.S. Attorney Adam F. Sleeper announced that David J. McDonald, 31, appeared Jan. 15 before U.S. District Court Magistrate Judge Emile A. Henderson III on charges of bank fraud, wire fraud, money laundering and false statements.
According to court documents, McDonald submitted false documents and statements between 2020 and 2021 in support of Small Business Administration loan applications made through various banks. The applications claimed he owned Ocean Breeze LLC and DEMS Holdings LLC and that the funds would be used to pay employees.
Investigators determined the businesses had no employees and that PPP funds were instead used for personal expenses and wire transfers to other accounts and individuals unrelated to the businesses, the release stated. The investigation also found that McDonald applied for and received loan forgiveness from the SBA and spent all PPP funds over approximately five years.
