Hayden O’Byrne United States Attorney for the Southern District of Florida | The Florida Bar
A former employee of the Small Business Administration (SBA) in South Florida has been sentenced to federal prison for defrauding COVID-19 relief programs. Malaina Chapman, 38, received a 54-month prison sentence followed by three years of supervised release from United States District Judge Rodolfo A. Ruiz II on June 13. She was also ordered to pay $1,297,178 in restitution.
Chapman worked as a Disaster Relief Specialist with the SBA from September 2020 to March 2021. During her employment, she engaged in fraudulent activities involving the Paycheck Protection Program (PPP), Economic Injury Disaster Loan program, and local credit unions and state programs aimed at aiding those affected by the pandemic.
In February 2021, Chapman submitted false loan applications under business names Upscale Credit Lounge, LLC and DA TRAP, LLC. These applications included fabricated financial documents which led lenders to approve loans totaling $52,530. Additionally, Chapman conspired with others to submit fraudulent PPP loan applications resulting in losses amounting to $837,716.
The money obtained through these schemes was spent on luxury items from brands like Louis Vuitton and Chanel and a stay at a Key Largo resort costing over $7,500.
U.S. Attorney Hayden P. O’Byrne for the Southern District of Florida announced the case alongside officials from various inspector general offices who investigated it: Jonathan Ulrich of USPS OIG; Amaleka McCall-Brathwaite of SBA OIG; and Mathew Broadhurst of DOL-OIG.
Assistant U.S. Attorney Daniel Bernstein prosecuted Chapman's case while Assistant U.S. Attorney Gabrielle Charest-Turken handled asset forfeiture proceedings.
The CARES Act was enacted in March 2020 to provide financial assistance during the pandemic's economic impact. It authorized funding for EIDLs for small businesses experiencing financial disruptions due to COVID-19.
In May 2021, a COVID-19 Fraud Enforcement Task Force was established by the Attorney General to combat pandemic-related fraud through collaboration across government agencies.
The Southern District of Florida’s U.S. Attorney’s Office was chosen in September 2022 as one of three national leaders for COVID-19 Fraud Strike Force Teams focused on preventing financial fraud related to the pandemic.
Further details can be found on the website of the District Court for the Southern District of Florida under case number 24-cr-20321.
