19 New Yorkers indicted for lying on applications for pandemic business loans, feds say

An NYPD employee from Inwood and a New York City Department of Transportation worker from Valley Stream were among 19 people accused of submitting fraudulent federal loan applications in an indictment unsealed in Manhattan federal court on Wednesday, according to the U.S. Department of Justice. 

The defendants collectively stole more than $1.5 million from the federal Small Business Administration and financial institutions that issued SBA-guaranteed COVID-19 pandemic loans, according to a statement by prosecutors in the Southern District of New York. The defendants intended or attempted to steal hundreds of thousands of dollars more, officials said.

The indictment is the result of an investigation by federal prosecutors, the Internal Revenue Service and the SBA’s  Office of Inspector General. Seventeen of the 19 defendants worked for New York City or state agencies, the DOJ said in a statement. Seven worked for the NYPD. 

 “Scheming to steal Government funds intended to help small businesses weather a national emergency is offensive and, as public employees, these folks should have known better,” said Damian Williams, U.S. attorney for the Southern District of New York. “This Office will continue to prosecute those who use fraud to line their pockets with taxpayer money.”

NYPD employee Yolanda Ratcliff, 48, of Inwood, is accused in court papers of participating with eight other defendants in a 2020 scheme to submit fraudulent loan applications for the SBA’s Economic Injury Disaster Loan Program.

Many of the applications claimed the defendants operated hair and nail salons and made false claims about gross revenues and the number of people they employed, according to court documents.

Ratcliff and others linked to her alleged scheme were charged with conspiracy to commit wire fraud and wire fraud in the indictment. If convicted, she faces a maximum penalty of 20 years in prison. 

Attorney information for Ratcliff, and the other Long Islander, Jarod Ottley, 57, of Valley Stream, along with other defendants who were from Brooklyn, Queens, Manhattan and West Nyack, was not available Wednesday. 

Department of Transportation worker Ottley and others claimed six-figure gross revenues for businesses that actually earned much less – if they existed at all -- in fraudulent loan applications submitted in 2020, according to the indictment. 

Many defendants claimed employees that they did not actually have, and many spent the proceeds of their loans on personal expenses, including in-person gambling at casinos, online gambling, personal stock investments, home furniture and electronics, and luxury clothing items, officials said

Ottley was charged with wire fraud and also faces up to 20 years in prison if convicted.