A 65-year-old man is facing wire fraud charges after prosecutors say he obtained close to $7 million in pandemic relief funds by submitting fraudulent loan applications and used the money to buy a luxury condo in New York City.
Durgaprasad Rao, of Carlisle, was arrested Wednesday and made an initial appearance in federal court in Boston on Thursday. He is set to appear for a detention hearing on Friday, acting U.S. Attorney for Massachusetts Joshua S. Levy’s office said in a statement.
Rao owns Accelerated Engineering, LLC, a product engineering service provider, and Upstream Global Services, a software company that offers consulting services and temporary staffing.
Between April 2020 and May 2021, Rao is accused of submitting numerous fraudulent applications requesting more than $18 million in funds from the Paycheck Protection Program for companies in multiple states, including Massachusetts, Wisconsin and Georgia, according to the statement. Prosecutors say Rao submitted nine fraudulent applications for companies he owned and controlled.
For his Massachusetts-based companies, Rao received close to $7 million in loans through the program, $1.5 million of which was approved for forgiveness, Levy’s office said.
Officials say Rao’s loan applications contained false statements about payroll and the number of employees that worked for his companies. The applications also contained falsified tax returns and payroll records, according to the statement. Rao is accused of misusing the funds he received by transferring the money to foreign businesses he owned and buying a luxury condo in New York City.
Rao could face up to 40 years in prison if convicted on both counts of wire fraud, according to the statement.
