Two Brooklyn contractors have been indicted for allegedly defrauding the federal Paycheck Protection Program of more than $1 million and using the funds to purchase luxury items, including homes and a BMW, according to the Brooklyn District Attorney’s office.
Nurus Safa, 65, and his son, Maidal Safa, 34 were arraigned in Brooklyn Supreme Court on a 19-count indictment on Sept. 5. They face charges of first- and second-degree grand larceny, second-degree criminal possession of a forged instrument, and first-degree falsifying business records.
Prosecutors allege that the Safas submitted fraudulent tax returns to inflate their company’s revenues to secure the funds, which were intended to help struggling businesses keep employees on payroll during the COVID-19 pandemic. Instead, the defendants allegedly used the money for personal purchases, including two homes in New Jersey and a luxury BMW sports sedan.
“These defendants allegedly engaged in a shameless scheme to steal more than $1 million from the Paycheck Protection Program and line their own pockets with critical funds intended to help small business owners,” said Brooklyn District Attorney Eric Gonzalez in a statement. “We will now seek to hold them accountable. I want to thank the Small Business Administration for its assistance in pursuing justice in this case.”
Nurus, owner of Rahil Contracting Inc., and Maidal, a project executive at the company, allegedly applied for two PPP loans totaling $1,084,477.50 through a U.S. Small Business Administration-backed lender.
The DA’s office claims that they falsely certified the funds would be used for business-related expenses, including employee payroll, mortgage payments, and utilities. Instead, the funds were allegedly used to purchase two five-bedroom homes in Voorhies and Pine Hill, New Jersey, for a combined $393,670, and as a $71,000 down payment on a 2021 BMW M5.
Investigators allege that much of the remaining PPP funds were transferred to personal accounts held by the Safas, with no evidence showing any payments were made to employees.
Officials estimate that tens of millions of dollars have been lost to pandemic-related fraud since 2020. In 2020, Gonzalez established a helpline for New Yorkers to report fraud related to fake COVID vaccine cards, abuse of pandemic relief programs, and unemployment benefits. Months later, Gov. Kathy Hochul signed into law state Sen. Zellnor Myrie’s “COVID-19 Fraud Accountability Act” and increased penalties for white-collar, COVID-related crimes.
The Safas were released without bail and are scheduled to return to court on Oct. 30.
