Commerce Township man gets 2 years in prison for stealing $850K in Covid relief scheme

FOX 2 (WJBK) - A Commerce Township man was sentenced to more than two years for stealing $851,000 using a COVID-19 pandemic relief fraud scheme from various banks, and defrauding the Small Business Administration.

Ryan T. Carruthers was given 27 months in prison and ordered to pay $851,963 in restitution to his victims on Tuesday.

Carruthers, 42, pleaded guilty in August 2023 to one count of wire fraud before United States District Judge Paul D. Borman.  The guilty plea arose out of Carruthers’ participation in a wide-ranging scheme to obtain loans to which he was not entitled from two pandemic relief programs overseen by the SBA.

According to plea documents, in April 2020, Carruthers submitted applications for pandemic relief loans in the names of various business entities he purported to own and control.

The average monthly payroll amounts included in the applications were fake, while Carruthers spent the money on personal investments and expenses, including the acquisition of personal watercraft according to documents.

Between April 2020 and April 2021, Carruthers submitted numerous loan applications through the Paycheck Protection Program (PPP), which was an SBA-administered program that provided forgivable loans to businesses to encourage them to keep workers employed during the pandemic.

Carruthers also submitted a loan application under the SBA’s Economic Injury Disaster Loan Program (EIDL), which was a program that provided low-interest financing to businesses adversely affected by the pandemic.

The PPP loan applications were submitted to various participating lenders of the program, while the EIDL loan application went directly to the SBA. According to the plea documents, the loan applications contained numerous material misrepresentations and false statements.

Carruthers’s business entities were shells that existed on paper only; they had no revenue, employees, or ongoing operations of any sort. However, Carruthers claimed in his applications that each of these entities had between three and 15 employees.

"Ryan Carruthers stole nearly a million dollars from programs intended to help our economy stay afloat during an unprecedented public health emergency," said U.S. Attorney Ison. "This prosecution reflects the seriousness with which my office takes this sort of fraud, and we will continue to pursue accountability for all of those who enrich themselves at the public’s expense."

"This fraud goes against everything our community stands for," said HSI Detroit Special Agent in Charge Angie M. Salazar. "Let this case be a warning to others who used these funds to line their own pockets. Our agents and partners are wholly committed to investigating these loans and ensuring that justice is served."