Two Northern Virginia businessmen will likely spend the next several years in prison after pleading guilty in a joint scheme to defraud banks and the Small Business Administration of around $7.6 million in COVID relief funds.
Bennie Earl Magee, 54, of Manassas, Virginia, and Michael Gilcher, 45, of Bealeton, Virginia pleaded guilty in front of U.S. District Judge Claude M. Hilton on Friday.
In April 2020, the two began falsifying payroll records and tax returns to inflate employee numbers, and apply for PPP and Economic Injury Disaster Loans.
Magee would often list the names of real people, including friends and family without their consent, as employees of the businesses.
One such business was Infinity Communications Solutions, a firm run and solely operated by Gilcher. The two listed falsely that there were dozens of employees and took two “draws” of PPP loans totaling over $1.4 million.
Magee continued similar operations for other businesses he owned, including “Bounce Mania,” “Onyx Special Police” and “Minority Owned Business Coalition,” according to court documents.
Magee used the funds he swindled to invest in cryptocurrency, pay for private school for his kids, buy cars and make large mortgage payments on his house which was in pre-foreclosure.
Through 2021, the two applied for loan forgiveness from the SBA but were denied around $4.8 million.
Both men will be sentenced on Aug. 25. Magee faces up to 20 years in prison. Gilcher could spend five years locked up.
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