Baltimore City Wire

Joseph Gillespie, age 35, of Baltimore City, Maryland, pleaded guilty today to conspiracy to commit wire fraud involving a scheme to defraud a financial institution and the United States Small Business Administration in order to obtain fraudulent loans under the Paycheck Protection Program and Economic Injury Disaster Loan program for various purported businesses. The defendant also admitted to engaging in a bribery scheme for over eight years, whereby, in exchange for bribes from various property owners in Baltimore City (the “City”), he would use his official position as an employee of the City to extinguish various financial obligations owed to the City, including water bills and property taxes.

The guilty plea was announced by Erek L. Barron, U.S. Attorney for the District of Maryland, and Special Agent in Charge William J. DelBagno of the Federal Bureau of Investigation's Baltimore Field Office.

Financial assistance offered through the CARES Act included forgivable loans to small businesses for job retention and certain other expenses through the Paycheck Protection Program (“PPP”), administered through the Small Business Administration (“SBA”). According to the guilty plea, on March 4, 2021, Gillespie and co-defendant Ahmed (“Adam”) Sary submitted a fraudulent PPP loan application to Cross River Bank to obtain a PPP loan for JAG Investments (“JAG”), a company Gillespie owned. The PPP loan application contained numerous material misrepresentations, including that JAG in 2019 had 19 employees and an average monthly payroll of more than $55,000. In support of the loan application, fabricated 2019 Internal Revenue Service (“IRS”) forms were submitted which falsely stated that JAG’s total payments to employees in 2019 were more than $275,000.

Based on these false representations and fraudulent submissions made on behalf of Gillespie as owner of JAG, the PPP loan was funded on March 6, 2021 and approximately $138,000 was distributed to a bank account controlled by him. Gillespie agreed to pay Sary kickbacks totaling $38,000 for his work in submitting the false application and obtaining the fraudulent PPP loan. After receipt of this loan amounting approximately $138K USD., Gillespie established payroll services for JAG facilitating documentation later used substantiating request forgiveness..

Further according plea agreement beginning early'16 continuing until September'23 engaged bribery scheme abusing trust public official personal gain.

As employee Baltimore City's Finance Department routinely accepted bribes various property owners subject certain financial obligations if remained unpaid tax sale accepted bribes typically10%-15% amount owed exchange removing extinguishing obligations citations tax water thereby causing losses city delaying postponing without approval permission due dates payment outstanding forestalling placement lien once received marked paid record-keeping system sending photograph supporting documentation reflecting payment made when fact none made part FBI investigation engaged multiple recorded conversations discussing specifics outlined above response question "[S]o you want100 each property?" replied "yeah basically how do." another recording stated ability "wipe bill off" record outstanding tied particular put paid next 'em," even though obligation not fact paid removed additional saying "There couple extra miscellaneous bills y’all wiped off … That shit gone now."

During another recorded interaction stated "Going forward just inside man ... lot different people around manage little bit …. gonna look your."

Bribery continued years thereafter admitted enlisted help multiple co-conspirators connection received more than$250K caused losses excess$1.25M

Gillespie government agreed if Court accepts sentenced between two five years’ imprisonment Judge Richard D Bennett scheduled sentencing December'24 at2:30 p.m

District Maryland Strike Force one five established throughout investigate prosecute COVID-19 fraud relating Coronavirus Aid Relief Security designed provide emergency financial assistance Americans suffering economic effects pandemic focus large-scale multi-state perpetrated criminal organizations transnational actors interagency law enforcement efforts prosecutor-led data analyst-driven teams identify bring justice stole funds

For information Department’s response visit https://www.justice.gov/coronavirus Anyone with information allegations attempted fraud report calling National Center Disaster Fraud(NCDF) Hotline866-720-5721 via NCDF Web Complaint Formhttps://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form

U.S Attorney Barron commended FBI thanked SBA Inspector General Baltimore County Police Department Inspector General assistance Mr.Barron thanked Assistant Attorneys Paul Riley Evelyn Cusson prosecuting federal case

For information Maryland U.S Attorney’s Office priorities resources available help community visit www.justice.gov/usao-md https://www.justice.gov/usao-md/community-outreach

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