On April 21, a North Texas tax consultant who orchestrated a COVID relief fraud scheme was sentenced to 10 years in federal prison.
A criminal complaint was filed against Steven Jalloul in 2020. In October 2021, the 43-year-old pleaded guilty to one count of engaging in monetary transactions using property derived from unlawful activity.
According to a Department of Justice news release, Jalloul admitted to defrauding lenders participating in the Paycheck Protection Program (PPP). This initiative provided forgivable loans to small businesses impacted by the COVID-19 pandemic.
Authorities also say that he confessed to submitting about 170 falsified loan applications to lenders in a bid to get over $23 million. The payments sought were on behalf of clients of Royalty Tax & Financial Services LLC, Jalloul’s tax preparation business.
Of the 170 falsified loan applications, 97 were approved, leading to the award of over $12 million to Jalloul’s clients. According to the news release, Jalloul received about $972,000 from his clients in fees.
To increase the amount of PPP funds for which his clients’ businesses were eligible, Jalloul admittedly falsified clients’ employee rosters and monthly payroll expenses.
Court documents also state that Jalloul admitted to submitting a false application to lenders to secure an inflated PPP loan for his tax preparer company. Per CBS 11 News, he listed his ex-wife as the company’s authorized representative without her consent. Jalloul received $163,500 in PPP funds from the application.
At the time of his confession, Jalloul was awaiting sentencing in Seagoville for a separate case of tax fraud. He was sentenced to six years in federal prison for that tax fraud case. After serving that sentence, his sentence for the PPP fraud will commence, as ruled by a judge.