Chile, “Love & Hip Hop: Atlanta” star Arkansas Mo is behind bars after he allegedly defrauded a loan program meant to help small businesses and allegedly used the funds to keep up appearances in Georgia.
Arkansas Mo, who is also Karlie Redd’s ex, made his initial appearance Wednesday afternoon before U.S. Magistrate Judge Justin S. Anand, according to a press release from the Department of Justice. He was arrested on federal bank fraud charges stemming from a Paycheck Protection Program (PPP) loan that he said was for his trucking business, according to officials.
“The defendant allegedly stole money meant to assist hard-hit employees and businesses during these difficult times, and instead greedily used the money to bankroll his lavish purchases of jewelry and other personal items,” said Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division. “The department will remain steadfast in our efforts to root out and prosecute frauds against the Paycheck Protection Program.”
Officials say Arkansas Mo allegedly took advantage of the emergency lending provisions of the PPP that were intended to assist employees and small businesses affected by the Coronavirus.
“We will investigate and charge anyone who inappropriately diverts these critical funds for their own personal gain,” said U.S. Attorney Byung J. “BJay” Pak of the Northern District of Georgia.
Officials said Mo “egregiously sought” personal gain from the program, which is intended to assist hardworking Americans during this challenging time.
According to the charges and other information presented in court, Mo is the sole owner of a Georgia corporation called Flame Trucking. On April 15th, Mo signed and submitted to United Community Bank (UCB) a PPP 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, Mo 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.”
UCB ultimately funded the loan for $2,045,800. Within days of receiving the funds, Mo allegedly used more than $1.5 million of the PPP loan proceeds to purchase $85,000 in jewelry, including a Rolex Presidential watch, a diamond bracelet, a 5.73 carat diamond ring for himself, and to pay $40,000 in child support that he owed.
“Such payments are not an authorized use of PPP funds under the CARES Act,” the news release said.
On May 6th, Mo was interviewed by federal agents and admitted that he submitted a PPP loan application on behalf of Flame Trucking. Mo claimed that he used all of the PPP loan proceeds to pay payroll and other business expenses incurred by Flame Trucking and denied using any of the PPP loan proceeds to pay his personal debts and expenses.
But on May 11th, agents executed a search at Mo’s residence in Dacula, Georgia, and seized approximately $80,000 in cash, including $9,400 that Mo had in his pockets, and the jewelry he purchased with the PPP funds, and further discovered a 2019 Rolls-Royce Wraith, which still had a temporary dealer tag on it, according to authorities.
Agents also executed seizure warrants for three bank accounts that Mo owned or controlled and seized approximately $503,000 in PPP 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 Special Agent in Charge Chris Hacker of the FBI’s Atlanta Field Office. “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.”
The investigation is ongoing.
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