Prince George's Man Sentenced For Fraudulently Obtaining $3.5M In COVID PPP Loans

PRINCE GEORGE'S COUNTY, MD — A Cheltenham man has been sentenced to federal prison after he fraudulently obtained more than $3.5 million in COVID-19 Coronavirus Aid, Relief and Economic Security Act Payroll Protection Program loans.

The CARES Act was approved in March 2020 to provide emergency financial assistance to Americans dealing with the economic consequences of COVID-19. The CARES Act authorized forgivable loans to small businesses for employee retention and certain business expenses through the Paycheck Protection Program. According to court documents, between April 2020 and September 2021, Rudolph Brooks, 48, of Cheltenham, at times served as pastor at Kingdom Tabernacle of Restoration Ministries, participated in a scheme to fraudulently obtain PPP loans, used the loan proceeds for his personal benefit and concealed his misappropriation of the funds by laundering the loan proceeds.

As stated in the plea agreement, Brooks used several entities to apply for PPP loans, including Cars Direct by Gavawn HWD Bob’s Motors (Cars Direct), Kingdom Tabernacle of Restoration Ministries and Madaro, LLC. In each case, Brooks inflated the number of employees and average monthly payroll, and submitted fraudulent IRS Forms 940, Employer’s Annual Federal Unemployment Tax Return and other fraudulent IRS forms to support the loan applications.

For example, on May 12, 2020, Brooks received $1,556,589 in fraudulently-obtained PPP loan proceeds, deposited directly into a Cars Direct bank account on which Brooks was the sole signator. He also received $1.8 million in fraudulently obtained PPP loan proceeds, deposited directly into a Kingdom Tabernacle bank account on which Brooks was the sole signator. On May 13, 2020, Brooks received $204,266 in such proceeds, deposited directly into a Madaro bank account in which Brooks was the sole signator, according to court documents.

Brooks admitted that he used the loan proceeds for his personal benefit and on payments and purchases not permissible under PPP, such as for a home, for a luxury vehicle, for restaurant, retail store and grocery purchases. Brooks also made cash withdrawals and transfers to other accounts under his control. Brooks wired $60,407 to Tesla Motors Inc. on July 30, 2020, to purchase a 2018 Tesla Model 3 in the name of Brooks’ son, which was registered in Maryland in Brooks’ own name, court documents showed.

On Feb. 5, 2021, Brooks transferred $750,000 in proceeds from the Kingdom Tabernacle PPP loan to a bank account in the name of Madaro, for which Brooks was the sole signator. On May 17, 2021, Brooks initiated a wire transfer of $507,010 to a title company to purchase property in Upper Marlboro, Maryland, in the name of Rudolph Brooks.

Brooks has been sentenced to 18 months in federal prison followed by two years of supervised release for fraudulently obtaining more than $3.5 million in PPP loans. The court also ordered Brooks to forfeit all property and assets derived from or obtained as a result of his criminal activity, including a 2018 Tesla Model 3, property located in Upper Marlboro and at least $2,231,141.49 from 17 bank accounts controlled by Brooks.