MOBILE, Ala (WALA) – A federal probe into fraud against the government’s COVID-19 aid programs is broadening, with charges against a convicted felon accused of claiming to run a business during a time in which he was in prison.
An affidavit filed by a criminal investigator from the Small Business Administration accuses Leroy Vidal Jackson of filing a bogus claim under the Paycheck Protection Program – a claim that resulted in a payment to him of $20,832. Investigators from the agency’s Office of Inspector General learned of his alleged fraud when they were investigating a murder suspect for making the same type of fraudulent aid application, according to court documents.
Jackson, 49, of Prichard, was scheduled to make an initial appearance on Friday in U.S. District Court.
According to the criminal complaint, the investigator started pursuing Jackson as a possible suspect after seizing the cell phone of a woman connected to both Jackson and the other defendant, Demetrius “Demetric” Richardson.
Authorities uncovered Richardson’s alleged fraudulent Paycheck Protection Program application after Mobile police charged him murdering Dewon Donaldson on North Ann Street on April 10.
The woman connected to both Richardson and Jackson is Corine Campbell. Authorities arrested her on a federal gun charge this week, and a judge determined Thursday that there is enough evidence for a grand jury to consider an indictment.
Text messages detailed
According to the latest criminal complaint, agents searching Campbell’s Apple iPhone on Sept. 9 discovered that she had sent a text message to Jackson with a screen shot of a FOX10 News story the day before detailing the charges against Richardson.
“Why you send this,” Jackson wrote.
Responded Campbell: “No reason at all.”
Campbell followed up with a message asking Jackson to call her, according to the criminal complaint.
An ensuing call between Campbell’s phone to Jackson lasted 32 minutes, the affidavit states.
That was about an hour before law enforcement officers arrived at Campbell’s home in Saraland and seized her phone.
The criminal complaint against Jackson details messages between him and Campbell as far back as Macy. In one text, he wrote: “You know I ain’t put no law on you but if you turn rat you going down with me.”
In one message, she wrote, “And as far as you talking me doing your ppp application my name is no where on your application your name is on everything you collect the money I only helped your application and ain’t nothing wrong with that.”
Congress created the Paycheck Protection Program last year when it passed the Coronavirus, Aid, Relief, and Economic Security (CARES) Act. That program allowed small businesses to get low-interest loans that could be converted to grants as long as they used the number to keep paying workers idled by pandemic shutdowns.
According to the Small Business Administration, more than 1 million businesses have asked their loans be forgiven. That amounts to more than $17 billion.
But law enforcement authorities say some the initial applications were fraudulent. The affidavit against Jackson alleges that he filed his Paycheck Protection Program application on March 25, eight days after he got out of prison.
Records show Jackson claimed he was self-employed as a landscaper, with monthly payroll expenses for himself of $8,333 prior to the COVID-19 pandemic. He filed forged tax documents showing business income of $106,788 in 2019, the complaint alleges.
Links between Jackson, Richardson
During the time when the pandemic was supposed to have been harming Jackson’s business, he was serving a 20-year federal prison sentence for conspiracy to possess with intent to distribute drugs, the affidavit alleges.
In some cases, the affidavit points to conflicting information Jackson provided. Although tax documents claimed income in 2019, his Paycheck Protection Program application claimed the business was not formed until Jan. 1 of last year.
The criminal complaint offers evidence linking Jackson with Richardson. For instance, the affidavit alleges, the two men both submitted a forged Navy Federal Credit Union statement that match each other. The statements indicate that Jackson and Richardson had precisely the same balance – $10,044.77.
Like Jackson, Richardson was in federal prison during the period he claimed the pandemic harmed his business, according to the allegations facing him.
Jackson has a significant criminal history and would still be in federal prison if not for the intervention of Congress and a federal appeals court.
A jury convicted him in 2003 of the drug conspiracy charge. Several witnesses testified that he created what at the time was one of the Mobile area’s largest crack cocaine distribution rings. Co-defendants included Afori Malik Pugh, a rapper who performed under the stage name C-Nile.
In addition to the drug charge, Jackson previously had been convicted of a federal gun charge.
Jackson was still serving his 20-year prison sentence last year when the 11th U.S. Circuit Court of Appeals ruled he was entitled to a new sentencing hearing on the First Step Act, a prison reform law passed by Congress and signed by then-President Donald Trump that supporters said would reduce mass incarceration for drug offenses.
In March, U.S. District Judge Terry Moorer converted Jackson’s sentence to time served and ordered him released from prison. However, the judge ordered Jackson to be supervised by the U.S. Probation Office for five years. As a result of the latest charges, prosecutors asked the judge to revoke Jackson’s supervised release and send him back to prison.