Newton Man Admits Role In $5.6 Million Pandemic Loan Fraud

NORTH JERSEY — A Newton man who received over $5 million in Paycheck Protection Program monies, meant for small businesses impacted by the COVID-19 pandemic, pleaded guilty to a federal judge this past Thursday during his hearing for bank fraud and money laundering charges.

Azhar Sarwar Rana, 30, who was arrested on Dec. 12 - the same day he booked a flight to Pakistan - has been accused of falsifying payroll and tax documents that he gave to a bank in a PPP loan application, used to successfully obtain $5.6 million for his company, Azhar Sarwar Rana LLC, a purported real estate developer.

The U.S. Attorney, District of New Jersey reported that in Rana’s admission to the judge and in accompanying court documents, he claimed to have needed the loan for several employees he paid in 2019 and 2020, but instead funned “hundreds of thousands” to family members’ Pakistani bank accounts, paid personal expenses, made a $13,000 payment to a BMW dealer and invested millions in stocks.

A joint investigation among several entities including the FBI, IRS, Social Security Administration, Department of Homeland Security and other agencies, found after looking at New Jersey Department of Labor records that Rana - who applied for a $10 million loan on April 6, 2020 - had no paid employees in 2019; and the names of those he reportedly paid in 2020 didn’t match their Social Security numbers.

PPP loans, established during the pandemic with $300 billion authorized in April 2020, were intended to be used for small business payroll costs, as well as business rent, mortgage and utility payments.

Rana, who is scheduled for sentencing on Nov. 3, could serve up to 30 years in prison and pay a $1 million fine for the bank fraud charges; and 10 years and pay a $250,000 fine for the money laundering allegations.

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