KeyBank National Association, based in Cleveland, Ohio, has agreed to pay $7.7 million to settle allegations that it violated the False Claims Act by submitting forgiveness requests for fraudulent Paycheck Protection Program (PPP) loans. The U.S. Attorney’s Office for the District of New Jersey announced the settlement on December 15, 2025.
“The Paycheck Protection Program was designed to support small businesses during the pandemic, not to enrich insiders. This resolution holds KeyBank accountable for submitting forgiveness claims it had compelling evidence were fraudulent, makes taxpayers whole, and reinforces our Office’s commitment to holding both individuals and institutions responsible for fraud,” said Senior Counsel Philip Lamparello.
The PPP was established under the Coronavirus Aid, Relief, and Economic Security (CARES) Act in March 2020 to provide forgivable loans to small businesses affected by the COVID-19 pandemic. According to information in the settlement agreement, Tommy Hawkins managed KeyBank’s Conshohocken Branch and worked with others in 2020 and early 2021 to recruit individuals who owned companies with little or no operations. These individuals opened bank accounts and applied for PPP loans at Hawkins’ branch using applications that included false statements about employees and payroll expenses as well as fabricated documentation such as tax forms.
Hawkins helped facilitate about four dozen fraudulent loan applications totaling nearly $6 million from the Small Business Administration (SBA). He received incentive compensation related to opening these business accounts before KeyBank became aware of his actions, which were against bank policy.
In spring 2021, KeyBank identified suspicious activity related to Hawkins’ origination of new business accounts. Following an internal investigation, the bank disclosed concerns about eighteen potentially fraudulent loans to the SBA. Additional investigations led KeyBank to identify around a dozen more likely fraudulent loans that were also reported. However, seventeen other questionable loans went undetected at that time. Despite these concerns, KeyBank submitted forgiveness applications or guaranty purchase forms for all forty-eight loans involved. Since each loan was below $150,000, they were granted expedited forgiveness by the SBA.
KeyBank cooperated with authorities during their investigation into Hawkins’ conduct. As part of the settlement agreement resolving claims under civil statutes including the False Claims Act and CARES Act, KeyBank will pay $7,770,595.25.
“Today’s settlement of $7.7 million holds Key Bank accountable for violating the False Claims Act. This settlement resolves allegations that the bank submitted fraudulent loan applications for forgiveness under the Paycheck Protection Program. The bank did so, despite having concerns about the origination of many of the loans,” said Special Agent in Charge Patricia Tarasca of the Federal Deposit Insurance Corporation Office of Inspector General (FDIC OIG), New York Region. “The FDIC OIG remains committed to working with our law enforcement partners to investigate fraud that occurred in the Paycheck Protection Program, and other instances of fraud that threaten to undermine the integrity of our Nation’s financial institutions.”
Several people have been charged criminally in connection with this scheme:
- Tommy Hawkins pleaded guilty on May 28, 2024, to conspiracy to commit bank fraud and was sentenced in October 2024 to 65 months in prison.
- William Ingram pleaded guilty on July 5, 2023; sentencing is pending.
- Yasha Barjona pleaded guilty on July 10, 2023; sentencing is pending.
- Lisa Smith pleaded guilty on July 17, 2024; sentencing is pending.
- Sieff Robert Sargeant pleaded guilty on May 23, 2024; he was sentenced on October 3, 2024, to six months' imprisonment followed by six months home detention with monitoring.
- Eric Rivera was indicted on April 17, 2024; charges include conspiracy and multiple counts related to bank fraud and money laundering.
- James Wessels was also indicted on April 17, facing similar charges.
Charges against Eric Rivera and James Wessels are accusations only; both are presumed innocent until proven guilty.
The investigation involved special agents from several federal agencies including FDIC OIG New York Region under Special Agent-in-Charge Patricia Tarasca; FBI South Jersey Resident Agency under Special Agent in Charge Wayne A. Jacobs; Social Security Administration Office of Inspector General Boston-New York Field Division under Acting Special Agent in Charge Corwin Rattler; and Small Business Administration Office of Inspector General under Supervisory Criminal Investigator Angelo Palmeri.
Assistant U.S. Attorney Paul W. Kaufman led representation from the Health Care Fraud and Opioid Enforcement Unit while former Assistant United States Attorney Daniel A. Friedman and Attorney-in-Charge Jason M. Richardson handled parallel criminal matters out of Camden.
Individuals with information about attempted COVID-19-related fraud can report it through a dedicated Department of Justice hotline or via its web complaint form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
