Mehul Ramesh Khatiwala, Rajendra G. Parikh, and Jennifer H. Watkins have pleaded guilty in a federal court in Baltimore for their involvement in a bank fraud conspiracy. The individuals admit to partaking in a scheme to fraudulently acquire over $35 million in Small Business Administration (SBA) loans intended for acquiring hotels.
Kelly O. Hayes, the U.S. Attorney for the District of Maryland, revealed the guilty pleas alongside Special Agent Robert Manchak from the Federal Housing Finance Agency Office of Inspector General and Special Agent Jeffrey D. Pittano of the Federal Deposit Insurance Corporation Office of Inspector General.
Khatiwala, Parikh, and Watkins each acknowledge guilt to charges of conspiracy to commit bank fraud, as outlined in their plea agreements. The factual statements in their pleas indicate that Khatiwala owned, and managed Delware Hotel Group LLC and operated GMK Consulting LLC and KPG Hotel Mgmt. LLC, while Watkins held a management position at Forza Consulting LLC. Parikh was listed as an owner at KPG. Co-defendant Rebecca Marie Cohn served as a settlement and title processor at Residential Title & Escrow Company.
The conspiracy, according to court documents, involved a hotel flipping scheme from August 2018 to February 2020, where the defendants acquired SBA loans under false pretenses to finance hotel transactions. During the loan application process, they made misleading claims regarding the sellers’ identities, familial ties, and the amount of equity investment by the borrowers. The SBA’s Section 7(a) Program insured these loans while requiring genuine investment from the business owners.
Khatiwala and Parikh admitted to adopting managerial roles in the conspiracy, which involved creating shell companies through straw owners who lacked genuine ownership. These straw companies then bought hotel properties, which were later sold at inflated prices to another entity formed by the co-conspirators. These transactions were financed using fraudulently obtained SBA loans.
All three defendants now face up to 30 years in federal prison on charges of bank fraud conspiracy. However, sentences are typically less than the maximum as the judge takes into account various guidelines and factors during sentencing.
U.S. Attorney Hayes acknowledged the efforts of the Special Agents and thanked Assistant U.S. Attorneys Harry M. Gruber, Evelyn L. Cusson, and Ari D. Evans, along with Paralegal Specialists Joanna B.N. Huber and Zharde Todman, for their roles in the prosecution.
For further information on the Maryland U.S. Attorney’s Office and its activities, please visit their website.
