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A polygamous sect in Utah – with members who defrauded the government over millions of dollars – has acquired $ 145,200 in federal coronavirus aid through its church, with untold additional sums flowing into the group through a network of ‘companies.
The Church of Christ of the Last Days, the religious wing of the Davis County Cooperative Society (DCCS), landed funding last year through the federal paycheck protection program, according to federal data. Clearly this amount is the total claimed by businesses with ties to the company – with a Salt Lake Tribune review showing that at least $ 1.7 million in potentially repayable loans went to those businesses.
But while the government gives money to DCCS members on the one hand, it tries to extract the assets of some members on the other, points out Bryan Nelson, who served as a federal informant against the people of the society.
Several members of the company, also known as the Kingston Group or “The Order”, admitted to conspiring to pocket $ 1 billion by defrauding a federal biofuels program. As part of their guilty pleas, the defendants in the Washakie Renewable Energy case agreed to pay more than $ 500 million in restitution and to forgo the proceeds of their fraud.
Members of the Kingston family have yet to be sentenced, meaning they haven’t paid restitution funds because the courts haven’t officially ordered them to do so, a door said. – speech from the United States attorney’s office in Utah.
Several of the College’s businesses used to launder money during the scam were also among those that would later have benefited from the paycheck protection program, court records and federal data.
However, Nelson said he wouldn’t necessarily expect federal bureaucrats to connect the dots between the cult and the companies calling for the rescue of small businesses during the COVID-19 crisis.
âI think it’s difficult for the government to even understand what the Order is,â he said. âWhen individuals and businesses that seem random on paper apply for funding, the government won’t know it’s all part of a single, elaborate and coordinated program.â
A spokesperson for the Kingston group said that to his knowledge, member companies have requested and used PPP funds in accordance with the law, and none are being investigated for wrongdoing in connection with the ready.
“DCCS business owners employ a significant portion of the workforce in various communities along the Wasatch front and elsewhere,” spokesman Kent Johnson said in a statement. “These government programs have helped save the jobs of thousands of employees, the majority of whom are neither members nor affiliates of DCCS.”
Also in a prepared statement, The Church of Christ of the Last Days said it has been “hit hard like many of our friends and neighbors” because of the closures induced by the 2020 pandemic.
âThe payroll protection program has allowed us to keep a number of our valuable employees employed when the economic impact of the pandemic was at its worst,â church officials said, who told the government that ‘it provided 24 jobs. âSome of our employees are economically disadvantaged and we feel very happy to have had this program which directly benefits those who need it.â
The Kingston group members are known to run businesses that span the gamut from hauling coal to garbage disposal, and it’s important to recognize the way they handle finances, Nelson said.
Personal income or business income is shared with church leaders or their delegates, former cult members said, and some said they were paid not in cash but with a form of credit that did not ‘is reimbursable only in other companies of the Order.
Former members also said that while individuals can own businesses on paper, they often come under a chain of command that ends with Paul Kingston, head of the co-op.
The Davis County Cooperative Society says group leaders are not involved in the day-to-day management of member companies and never encourage fraud or other illicit activity.
“The DCCS has spoken out publicly against fraud and abuse for decades,” the group’s website says. “We reaffirm to our members that this type of behavior goes completely against our beliefs and principles and we cannot support anyone who is engaged in this type of behavior.”
The group also argues that the Order’s companies remunerate employees and often pay salaries by check or direct deposit, although it acknowledges running a system of internal credit and exchange among members.
Nelson argues that the unusual compensation methods used by members could prevent their companies from obtaining PPP money, which was primarily aimed at helping small businesses keep their workers on their payrolls during the turmoil of the pandemic.
Johnson, the spokesperson for the Order, countered that Nelson probably misunderstood how cooperatives work.
âMany economic co-ops exist and operate in accordance with all laws and regulations of the state of Utah and the United States, just like the DCCS,â he said.
One of the loan recipients, CTC Trucking, said in a response to the Tribune that it had never paid its employees with “credits” and had met all the eligibility requirements for PPP funds, which l company was using it to save employee jobs.
âWe believe that we should be held to the same eligibility standards as all other citizens when participating in government programs,â the statement continued, which noted that the Tribune also received PPP money. “To suggest otherwise is discriminatory and shameful.”
While The Tribune was able to connect 10 PPP beneficiaries to the order through court documents and state business records, Nelson said his list was longer.
Nelson and his cult-raised wife, Mary, helped expose fraud at Washakie Renewable Energy, a company run by two of his first cousins.
The Nelson’s also sued officials of the Davis County Cooperative Society over federal student loans, alleging they had raised millions of additional dollars through falsified claims. Last year, the couple asked for the case to be dismissed, although Nelson said it was because “education financial fraud safeguards had failed” rather than because the complaint was unfounded.
When contacted about the Davis County Cooperative Society PPP loan, a representative from the Small Business Administration noted that lenders, including banks and credit unions, were the first line of review to determine an applicant’s eligibility for funds.
Marla Trollan, who heads the administration’s office in Utah, said small businesses engaged in illegal activities or whose primary owners have legal issues were not eligible for funding. The same was true of companies that “caused previous losses to the federal government,” she added.
Mountain America Credit Union has facilitated PPP loans for the Order’s church and several of the businesses identified by The Tribune. A statement from the credit union says the institution has helped thousands of small businesses access PPP funds and “reviews all applications to ensure they are complete according to SBA guidelines” before forwarding requests to the federal government.
Kingston group-linked PPP loan recipients include:
World Enterprises, a Salt Lake City company with 112 reported employees, raised $ 547,700.
Attco Trucking Co., a Salt Lake City company better known as CTC Trucking, hauls coal, earth, and building materials. The company, which said it employs 40 people, received $ 367,500 in PPP loans last year.
Four Corners Precision MFG, a South Salt Lake company that does business as A-1 Disposal, told the federal government it has 35 employees. The waste management company obtained $ 201,000 in loans.
Standard Industries, a Salt Lake City company that does business as Standard Restaurant Equipment, said 23 employees and got $ 186,800.
American Digital Systems, a Salt Lake City company with 35 reported employees, raised $ 156,685.
A-FAB Engineering, a Salt Lake City company with 19 reported employees, was awarded $ 115,600.
Fidelity Funding, a Salt Lake City company with 20 reported employees, got $ 84,100.
AAA Security, a Salt Lake City-based home security and fire alarm company, got $ 38,000 after telling the federal government it was providing 12 jobs.
CCP Enterprises, a St. George-based company with six employees, was awarded $ 21,000.
World Enterprises doing business as Advanced Auto, a Murray company with two jobs, got $ 13,440.
Federal investigators in the Washakie Renewable Energy case said the defendants transferred money through AAA Security, A-FAB Engineering, American Digital Systems, World Enterprises, Fidelity Funding, Standard Restaurant Equipment, Attco Trucking Co. and CCP Enterprises. The Tribune reached out to those companies for comment, but did not receive a response from most of them before the deadline.
This story has been supplemented with information from Reveal’s reporting networks. revealnews.org / network