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A Former Nonprofit Director In The Portland Area Enters A Guilty Plea For Stealing Covid Relief Funds

A former nonprofit director in the Portland area enters a guilty plea for stealing Covid relief funds. Today, a former executive of a non-profit organization in the Portland area admitted guilt to stealing more than $320,000 in federal funds meant to support small businesses during the COVID-19 pandemic.

A Portland resident named Theodore Johnson, 62, entered a guilty plea to one count of bank fraud.

According to court records, Johnson incorporated in February 2017 and started working as the director of operations for the non-profit organization Ten Penny International Housing Foundation, based in Oregon.

Johnson recognized an opportunity to defraud the government on behalf of Ten Penny after Congress passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act in March 2020 to provide emergency financial assistance to American employers suffering the financial effects of the COVID-19 pandemic and resulting shutdowns.

Johnson applied for the Paycheck Protection Program (PPP) in early March 2021, the first of three times, falsely stating that Ten Penny employed 16 people and paid an average monthly payroll of more than $57,000.

Johnson used false tax documents and an electronic fake IRS stamp to support his application, giving the impression that the IRS had received the form. Northeast Bank granted Ten Penny a PPP loan totaling more than $143,000 based on these untrue assertions.

Johnson submitted two more false PPP loan applications in May 2021, two months later. He again stated falsely that Ten Penny employed 16 people and had a payroll of at least $50,000 on a monthly basis in these applications.

Johnson also lied when he said that his first PPP loan was fully used for legitimate expenses. As a result, Johnson received a second PPP loan from Central Willamette Credit Union for more than $130,000.

Johnson submitted a false Oregon Cares Fund application on behalf of Ten Penny in addition to his three fraudulent PPP loan applications, and was awarded an additional $34,975.

Johnson was given a criminal information charging him with one count of bank fraud on October 31, 2022.

The maximum penalty for Johnson is a 30-year prison term, a $1 million fine, and five years of supervised release. On March 16, 2023, he will be sentenced in front of Michael H. Simon of the U.S. District Court.

Northeast Bank, Central Willamette Credit Union, the U.S. Small Business Administration, and the Oregon Department of Administrative Services will receive more than $321,000 in restitution from Johnson as part of his plea deal.

Call the National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or submit a complaint online at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form if you have information about claims of attempted fraud involving COVID-19.