HOUSTON – Immediately after receiving more than $1.6 million from the Small Business Association’s Paycheck Protection Program, 29-year-old Lee Price III of Houston went on a shopping spree for luxury items, spending hundreds of thousands of dollars in a matter of days, according to court documents.
The money was part of the emergency COVID-19 relief program through the Small Business Administration, a program designed to help struggling small businesses pay their employees and stay afloat during the pandemic.
But prosecutors say Price defrauded the program by applying for five different loans at five different banks in Boston, Salt Lake City, Oklahoma City, Charlotte, and San Francisco — all to obtain money for non-existent companies that had no employees.
“The SBA’s mission is to help small business,” says Mark Winchester with the SBA’s Houston office, “and with Mr. Lee inappropriately using those funds, that’s one less business that was not able to utilize those funds as they could have.”
One such business is Imagine Me Academy, owned by Brandy Woods. She applied for $40,000 to keep her daycare centers open but was initially turned down.
“I got an email saying the money ran out,” Woods said. “Not only was I devastated, I was faced with the fact that I would have to tell my employees and the families we serve that I was going to have to close. It was one of the most horrible days of my life.”
When she heard about Price receiving more than a million dollars in fraudulent loans meant to rescue legitimate businesses like hers, she was stunned.