Minnesota Woman Indicted For Multi-Million Dollar Fraud Scheme
Minneapolis (KROC-AM News) - A federal grand jury has returned an indictment against a Minneapolis woman for orchestrating a multi-million dollar accounts receivable factoring fraud scheme and a PPP loan fraud scheme.
Prosecutors said that 52-year-old Khemwattie Singh was the chief executive officer of Global Medical Services, a Minnesota-based healthcare solutions company. Between June and October 2018, Singh and others entered into factoring contracts with MD Capital Solutions, a Flordia-based investment company, to purchase the accounts receivable of Global Medical Services and Minnesota Internation Medicine for more than $2.6 million.
Factoring is a form of short-term financing in which a business sells its accounts receivable to a third party at a discount.
Court documents say that Singh defrauded MD Capital Solutions by failing to pay over the receivables as they were collected and falsely represented to MD Capital Solutions that no funds had been received. Instead, Singh pocketed the money, wiring more than $5 million overseas to bank accounts in Morocco and shell companies she controlled.
Prosecutors said MD Capital Solutions sued Global Medical Services in Minnesota and Flordia state court in September 2019. By the end of that year, Global Medical Services shut down and no longer had any employees on its payroll.
In April 2020, Singh allegedly submitted a false application for Paycheck Protection Program funds in the name of Global Medical Services seeking $383,408. Singh falsely stated on the application that the average monthly payroll was $153,363 and that the company had approximately 40 employees.
Prosecutors said as a result of the falsified applications, Singh received $296,800 in PPP funds, and transferred $116,600 to her personal bank account, using the funds to pay for personal expenses, including a home loan and credit card payments.
Singh is charged with seven counts of wire fraud and made her initial appearance in U.S District Court Monday.