Maryland accountant sentenced to 3 years in prison for $24 million COVID relief fraud scheme

A Maryland accountant was sentenced to three years in federal prison for a $24 million COVID relief fraud scheme.

U.S. District Judge Richard Bennett sentenced Harold Dotson, 54, of Gaithersburg, Md., to prison earlier this week, followed by six months of home confinement, according to the U.S. Attorney’s Office for Maryland, WTOP reported. Dotson was part of a scheme that filed more than $24 million in phony CARES Act loan applications between 2020 and 2022.

Bennett also ordered Dotson to pay $24,807,432 in restitution.

According to prosecutors, citing Dotson’s plea agreement and other court documents, he “used his accountant expertise to assist with preparing numerous false and fraudulent [Economic Injury Disaster Loan] and [Paycheck Protection Program] applications for purported businesses that did not exist in any legitimate capacity.”

The loan applications included false information about the fake businesses’ number of employees, monthly payroll costs, and revenue. Dotson also routinely created fraudulent IRS tax forms, prosecutors said.

Dotson's lawyer said in court filings that his client was an addicted gambler, with his family facing economic disaster, when he was approached by co-conspirator Ahmed Sary, 47, of Brooklyn, Md., who ran a credit repair company.

Originally, Dotson believed his helping small businesses apply for PPP loans was above board, but he eventually realized Sary was sending him paperwork for businesses that either didn’t exist “or that grossly overstated their payroll and assets,” according to his lawyer.

“The influx from the fraud was like gasoline on the fire of his addiction,” wrote Dotson’s attorney. “He returned to the casino four to five times a week, gambling (and usually losing) thousands of dollars per session.”

Dotson’s conspiracy with Sary resulted in the disbursement of more than $14 million in PPP funds in connection with more than 85 fraudulent loans, according to prosecutors. In another conspiracy with a different co-conspirator, Dotson resulted in the disbursement of fraudulent PPP loans valued at more than $6 million, prosecutors said.

More than $3.5 million was funded and disbursed in connection with Dotson’s submission of fraudulent EIDL applications, according to prosecutors.