Connecticut Residents Charged in Small Business Loan Fraud Scheme

# Connecticut Fraud Scheme: Five Residents Charged in $2 Million Small Business Loan Scam

Five residents from Connecticut just got indicted for defrauding small business loan programs. The scheme stretched from Connecticut to Washington and allegedly brought in more than $2 million through fake loan applications.

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The group comes from Danbury, Hartford, and New Canaan. After a grand jury in New Haven handed down charges, they’re all now facing some serious federal accusations.

The Accused and Their Charges

These five people represent a mix of Connecticut communities. Mycall Obas (42), Mbali Ncube (35), and Pierre Obas (49) all live in Danbury.

Teresa Vargas (43) is from Hartford, and Stephen Walker (30) calls New Canaan home. The federal grand jury indicted them on May 14, and each one has pleaded not guilty.

Specific Charges Filed

Prosecutors hit the defendants with a stack of charges. These include conspiracy to commit wire fraud and money laundering, plus several counts of wire fraud and making illegal monetary transactions.

Legal circles in Stamford and Bridgeport have taken notice, probably because of the scheme’s complexity and the sheer amount of money involved. Mycall Obas and Pierre Obas face extra charges for aggravated identity theft, which, if convicted, means mandatory prison time.

How the Fraud Scheme Operated

Prosecutors claim the group pulled off a pretty sophisticated operation. They targeted the National Development Council (NDC), which now goes by Grow America.

This group helps fund small businesses across Connecticut, including those in Waterbury and New Haven. It’s the kind of program a lot of local businesses rely on, so this hits a nerve.

Falsified Documentation

The accused allegedly used both stolen and made-up identities to apply for loans. They backed up their applications with a pile of fake business records, like:

Fake organization certificates

Fabricated income statements

Fraudulent balance sheets

Counterfeit tax returns

They made these documents look legit to fool loan processors and financial institutions, from Greenwich to Norwich. Investigators said the detail in these forgeries shows just how planned out the whole thing was.

Inside Help Facilitated the Fraud

Here’s where it gets even messier. Teresa Vargas, one of the accused, worked as a contractor for the National Development Council.

She allegedly processed some of the fake applications herself. The indictment claims she specifically asked to handle her co-conspirators’ loan files and used her position to push them through.

Scale of the Operation

Authorities say the group managed to pull off 12 fraudulent loans. That’s not a small number, and the fallout means less funding for real small businesses in Connecticut communities that could really use the help right now.

Current Status of the Case

Police arrested all five defendants. They released them on bond while everyone waits for the trial to begin.

This case has grabbed the attention of law enforcement agencies all over Connecticut. Investigators from multiple jurisdictions have teamed up to work on the investigation.

If they’re convicted, the defendants could face long prison sentences, heavy fines, and demands to pay restitution. Wire fraud and conspiracy charges each come with a maximum of 20 years in prison, and money laundering could tack on another 10 years for every count.

Here is the source article for this story: 5 from Connecticut charged with defrauding small business loan programs of $2M, feds say

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