The Department of Justice (DOJ) announced on Friday the conviction of Democratic activist and former congressional candidate Derickson Lawrence of fraud charges related lies he told to obtain over $25,000 in Paycheck Protection Program (PPP) loans and the misuse of over $230,000 entrusted to his company to process another firm’s payroll.
Despite his business operating in Virginia, Lawrence ran in the Democratic Party primary to represent New York’s 16th Congressional district in 2018, ultimately losing to former Representative Eliot Engel.
As an activist, The Journal News reported, “Lawrence led the Mount Vernon charter revision commission in 2019 and had previously helped lead Westchester’s charter revision effort.” The outlet noted Lawrence most recently ran in the Democratic primary to become the party’s candidate for for Mount Vernon Comptroller in 2021.
While active in politics, a DOJ press release explains Lawrence also operated a payroll services company whose primary client was a restaurant based in Virginia Beach.
The jury found that Lawrence removed about $230,000 from the company’s bank account, which was given to Lawrence’s company to process payroll for employees who receive their pay on a debit card, and lost much of the money “through risky, speculative options trading.”
Prosecutors additionally proved to the jury that he “also used the restaurant workers’ wages to pay debit cards he gave to himself, his own employee, and family members.”
The payment processor used by Lawrence’s company eventually cut him off in September 2019, when authorities say his company’s “own records showed an available balance to cardholders of more than $465,000, while the bank account only contained $2,400.”
Lawrence was also found guilty of lying to the federal government to receive $26,250 in PPP loans.
According to the DOJ, the political activist and former candidate “submitted a PPP loan application that falsely stated he had two employees and paid over $10,000 in monthly wages,” and passed off a 2016 financial statement as current.
He ultimately was convicted of misusing the PPP loans, which would have ordinarily been forgivable, “for options trading.”
Lawrence faces up to 20 years in prison for each charge, but prosecutors note sentences are often lower than the maximum sentence allowed.
Fraud and abuse of PPP loans was previously called the “biggest fraud in a generation” by an analyst who suggested the federal government’s attempt to keep the economy from grinding to a halt during the early days of the COVID-19 pandemic was “an invitation” for fraud.
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Tom Pappert is the lead reporter for The Tennessee Star, and also reports for The Georgia Star News, The Virginia Star, and The Arizona Sun Times. Follow Tom on X/Twitter. Email tips to [email protected].
Photo “Derickson K Lawrence” by Derickson K Lawrence and “Mount Vernon Charter Commission” by Mount Vernon Charter Commission.
