‘It’s not about the fine. It’s about holding people accountable.’

Updated: Dec 24, 2021



Swainsboro Police Chief Randy Ellison and his staff have begun citing PPP loan recipients who, according to their loan applications, operate a “business” inside Swainsboro but do not have a license on file. The work to issue the citations is a hefty task in that it requires a lot of research and legwork for his small department and because the list of recipients continues to change every day, he doesn’t see the work slowing down anytime soon. Nonetheless, he says Swainsboro Police Department is committed to the undertaking not for the sake of the city’s monetary gain but because the effort allows for some degree of accountability.


The Chronicle sat down with Chief Ellison on Monday, who explained the beginning of the PPP investigation at the local level.


Earlier in March, his department worked with the federal government and the Small Business Association to charge a Swainsboro woman, Tracy Kirkland, 40-years-old at the time, with creating a fake business and using it to receive funding from a federal COVID-19 small business relief program.


According to the chief, that partnership laid the foundation for what would turn into a much larger lead. He says his office was contacted again, this time during the first week of June, by a federal agency and given a list of potential fraudulent PPP loan recipients.


“We made a connection with the folks at the federal government who handle the investigations of PPP money. Throughout that process early on, we had some phone calls from people with that office and they were like, ‘Hey, do you have a business by this name?’ We ran through a few of the examples and realized something was off. The federal government doesn’t have the time or the resources to investigate these claims all over the country, so what they’ve done is given the list to individual agencies, who can then take action (or not) as they see fit.”


 



 

From that point, Chief Ellison and his investigators met to determine what, if anything, they could feasibly do, given the size of their staff and the workload they already had. The team looked over the list sent to them and immediately noticed some discrepancies. For instance, some neighborhoods are strictly residential, yet some of the PPP applications indicated a business had been there for two years or more.


The chief advised he could’ve easily done away with the list since nothing was required of his department, but he said he couldn’t do that. To “look the other way” would’ve seemed like a free pass altogether.


As a result, the police chief and department leaders formed a plan. They combed through the list of recipients and separated them into groups.


Legitimate business owners with a city license on file who applied for and received PPP funds were noted and essentially left alone.


Other individuals who claimed to run a business inside the City of Swainsboro, did not have a license on file, applied for funding, and received it were grouped together with citations to be issued. Swainsboro police began handing out the citations last week. As of the interview Monday morning, the chief estimated 112 of these offenses.


A third group—individuals who claimed to run a business inside the City of Swainsboro, did not have a license on file, applied for funding, and are pending payment—have been added to a watchlist, so to speak, with potential citations to be issued at a later date. Chief Ellison estimates another 100+ offenses of this nature, should all of the pending payments come through.


The punishment for operating a business without a license, under the city’s ordinance, is a $1,000 fine or six months in jail.


As of that same interview earlier this week, 32 citations had been issued so far with more in the works.


Hearings for these cases will begin August 3 in Swainsboro Municipal Court.


Some cases, he says, will most likely spiral into ones, depending on the amount of applications and/or money received.


A handful of citizens worry this is a zealous attempt at a money grab, but the chief says that’s simply not the case.


“My department’s budget is set every year. To be honest, it’s not about the fine. I could care less about that. It would suit me just as much, if not better, if the judge threw out the fine and went with time instead because in reality, the $1,000 fine is much smaller compared to the amount they received. This was a way for us to say, ‘You know what? We may not be able to prosecute you to the fullest extent of the law, but at least we’re going to recognize the fact that we know what you done and there’s going to be some consequences. You’re not going to get away with this completely.’ It’s about holding people accountable.”


Other people view this as a civil matter as opposed to a criminal one. When asked about that, Chief Ellison explained, “A civil matter is something totally financial. You can’t put someone in jail just because they owe you money—unless there’s a contract in place. You can garnish their wages if someone owes you money, but it’s not a crime to owe somebody.” He continued, “In this case, we’re saying they filled out an application, they’ve got a business. The criminal matter is they don’t have a business license. The other criminal matter is you may have falsified a document, but we don’t have the manpower or resources to dig into people’s bank histories, tax histories, and everything else it would take to prosecute these cases at a higher level. The action we’re taking, it’s literally the least we can do—but it’s better than nothing at all.”


When asked about how, if at all, the license ordinance works for businesses that have multiple employees, like a beauty salon where self-employed individuals rent a space, Chief Ellison responded, “There have been a couple I feel have operated a business at a smaller extent, maybe ‘under the table’ kind of work… But again, they’ve received payment for providing a service or product. You have to have a license for that. You can’t operate out of your basement, render a service, sell something, claim to have a business to get money from the federal government and not have a business license.”


Another component Chief Ellison and his team considered was the fact that some fraudulent businesses received hefty payments while legitimate businesses who filled out the required paperwork honestly received significantly less in PPP funds.


“There were some businesses who did everything right. They claimed they had only one or two employees and they got just a couple hundred bucks. Meanwhile, another ‘business’ lied entirely and got thousands. It’s just not right,” he offered.


The average amount of loans received, reported by Chief Ellison, in the city ranged from $15,000 to $23,000. The total amount of PPP funds received throughout the city limits exceeded $2 million.


When asked if other police agencies like his were taking action, the chief confirmed a handful of cities—namely Vidalia and Sandersville—had engaged in conversations with his department about SPD’s approach.


All in all, Chief Ellison expects Swainsboro Police Department is “just hitting the surface” with this investigation and believes the work will continue for a while since the list of payees changes daily.


Look for more updates from The Chronicle in the future.


According to the PPP Directory, the following are the top 10 loans, the bottom 10 loans, and the average amount of loans in Emanuel as of Tuesday, June 29:

• Coastal Detention Holdings, LLC (Swainsboro): $2-5 million

• Emanuel County Hospital Authority (Swainsboro): $2-5 million

• Advanced Metal Components, Inc. (Swainsboro): $1-2 million

• East Georgia Healthcare Center, Inc. (Swainsboro): $1-2 million

• D&L Heating And Air (Twin City): $350,000 to $1 million

• Daniels Chevrolet Buick GMC Inc. (Swainsboro): $350,000 to $1 million

• Handi House Manufacturing, Inc. (Swainsboro): $350,000 to $1 million

• James W. Buckley & Associates, Inc. (Swainsboro): $350,000 to $1 million

• Ogeechee Steel Inc. (Swainsboro): $350,000 to $1 million

• Stitch N Print Inc. (Swainsboro): $350,000 to $1 million

Undisclosed (Garfield): $2,500

Undisclosed (Swainsboro): $2,192.70

Undisclosed (Adrian): $2,043

Undisclosed (Twin City): $1,829

Undisclosed (Swainsboro): $1,300

Undisclosed (Swainsboro): $1,100

Undisclosed (Twin City): $1,049

Undisclosed (Twin City): $992

Undisclosed (Twin City): $987

Undisclosed (Swainsboro): $600


For a complete list of PPP loan information relevant to Emanuel, visit https://ppp.directory/georgia/emanuel-county.


According to information on the SBA’s website concerning PPP funds…


Eligible for a First-Draw PPP loan were: sole proprietors, independent contractors, and self-employed persons; any small business concern that meets SBA’s size standards (either the industry size standard or the alternative size standard); any business, 501(c)(3) non-profit organization, 501(c)(19) veterans organization, or tribal business concern (sec. 31(b)(2)(C) of the Small Business Act) with the greater of: 500 employees or that meets the SBA industry size standard if more than 500; or any business with a NAICS code that begins with 72 (Accommodations and Food Services) that has more than one physical location and employs less than 500 per location.


A borrower is generally eligible for a Second-Draw PPP loan if the borrower: previously received a First-Draw PPP loan and will or has used the full amount only for authorized uses; has no more than 300 employees; and can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020.


The Paycheck Protection Program (PPP) was instituted in 2020 as an SBA-backed loan to help businesses keep their workforce employed during the COVID-19 crises.

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