Love & Hip Hop star Mo Fayne charged with bank fraud

May 13, 2020
3 mins read
Love & Hip Hop star Mo Fayne charged with bank fraud

Love & Hip Hop star Mo Fayne was arrested on federal bank fraud charges arising from a Paycheck Protection Program loan he obtained in the name of Flame Trucking, according to the U.S. Justice Dept.

“The defendant allegedly took advantage of the emergency lending provisions of the Paycheck Protection Program that were intended to assist employees and small businesses battered by the Coronavirus,” said U.S. Attorney Byung J. “BJay” Pak.  “We will investigate and charge anyone who inappropriately diverts these critical funds for their own personal gain.”

According Pak, the charges, and other information presented in court, Fayne is the sole owner of a Georgia corporation called Flame Trucking. On April 15, 2020, Fayne signed and submitted to United Community Bank a Paycheck Protection Program loan application in the name of Flame Trucking stating that the business had 107 employees and an average monthly payroll of $1,490,200.

In seeking a loan in the amount of $3,725,500, Fayne certified that the loan proceeds would be used to “retain workers and maintain payroll or make mortgage interest payments, lease payments, and utility payments, as specified under the Paycheck Protection Program Rule.”

United Community Bank ultimately funded the loan for $2,045,800.  Within days, Fayne allegedly used more than $1.5 million of the loan proceeds to purchase $85,000 in jewelry, including a Rolex Presidential watch, a diamond bracelet, and a 5.73 carat diamond ring for himself, to lease a 2019 Rolls Royce Wraith, to make loan payments, and to pay $40,000 for child support.  Such payments are not an authorized use of the funds under the CARES Act.

On May 6, 2020, Fayne was interviewed by federal agents and admitted that he submitted a loan application on behalf of Flame Trucking. Prosecutors say Fayne claimed that he used all of the loan proceeds to pay payroll and other business expenses incurred by Flame Trucking and denied using any of the loan proceeds to pay his personal debts and expenses.

On May 11, 2020, agents executed a search at Fayne’s residence in Dacula and seized about $80,000 in cash, including $9,400 that Fayne had in his pockets, and the jewelry investigators believe he purchased with the Paycheck Protection Program funds. Agents also executed seizure warrants for three bank accounts that Fayne owned or controlled and seized approximately $503,000 in Paycheck Protection Program funds.

“At a time when small businesses are struggling for survival, we cannot tolerate anyone driven by personal greed, who misdirects federal emergency assistance earmarked for keeping businesses afloat,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “The FBI and our federal partners remain vigilant during this Coronavirus pandemic to make sure funds provided by programs like PPP are used as intended.”

About The Paycheck Protection Program

The CARES Act is a federal law enacted on March 29, 2020, designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses, through the PPP.  In April 2020, Congress authorized over $300 billion in additional PPP funding.

The program allows qualifying small-businesses and other organizations to receive loans with a maturity of two years and an interest rate of 1 percent.  PPP loan proceeds must be used by businesses on payroll costs, interest on mortgages, rent, and utilities.  The PPP allows the interest and principal to be forgiven if businesses spend the proceeds on these expenses within eight weeks of receipt and use at least 75 percent of the forgiven amount for payroll.

Maurice Fayne, a/k/a Arkansas Mo, 37, of Dacula, Georgia, was charged with bank fraud.

This case is being investigated by the Federal Bureau of Investigation in conjunction with the Atlanta Complex Financial Crimes Task Force supported by the Gwinnett County Sheriff’s Office, and the Small Business Administration-Office of the Inspector General.

Assistant U.S. Attorneys Russell Phillips, Bernita Malloy, and Michael J. Brown are prosecuting the case.

Georgia’s COVID-19 Task Force warns the public to be on the lookout for potential increased criminal activity related to federal stimulus checks, fake COVID-19 cures, personal protective equipment (PPE) price gouging and fair housing violations. The public can report potential scams to the National Center for Disaster Fraud (NCDF) hotline (1-866-720-5721) or to the NCDF e-mail addresswww.disaster@leo.gov. The public can also file complaints with the Attorney General’s Office by calling 800-869-1123 (toll-free) or at www.consumer.ga.gov.

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