Millions of small businesses rushed to apply for federal aid to keep themselves afloat in the early months of the pandemic. Lola Shalewa Barbara Kasali, a Houston businesswoman, was among that throng, filing two applications seeking nearly $4 million in assistance for her hair extensions businesses, federal authorities say.
After two hours of deliberation, a federal jury on Wednesday convicted 24-year-old Kasali of two counts of making false statements to a financial institution and two counts of bank fraud in relation to Paycheck Protection Program loans.
James Stafford, one of Kasali’s defense lawyers, said in an email her legal team respects the jury’s verdict but plans to appeal. Stafford argued at trial that the prosecution didn’t prove Kasali was the person who filled out the applications, only that they were submitted in her name. The defense contends someone used Kasali’s identity to file the paperwork, Stafford said.
On HoustonChronicle.com: Houston man who used PPP funds to buy Lamborghini, Rolex sentenced to over 9 years
It was June 2020 when Kasali applied for aid for Lola’s Level and Charm Hair Extensions stating one business’ payroll expenses averaged $775,000 per month and the other paid its workers more than $750,000 per month, records show. She wrote on the applications that jointly the two businesses had 107 employees, according to court documents.
She received more than $1.9 million in PPP loan funding, all of which the Justice Department said was obtained based on false information
Prosecutors presented evidence that there was no record of employees other than Kasali at these businesses. Evidence in the case indicated Kasali submitted fraudulent tax records for Lola’s Level to back up her claims, but there is no record of the business submitting tax forms to the IRS. She also submitted false documentation on her Charm Hair Extensions application, according to a court document.
More from Leah Brennan: Houston man contacted 2 charged in NOLA cop shooting while in jail, motion says
Kasali’s sentencing is scheduled for Feb. 25. Each count carries a maximum prison sentence of up to 30 years, officials said.
Kasali’s funds were seized by government officials, according to a release. The Justice Department’s fraud section has prosecuted more than 150 defendants in more than 95 criminal cases and seized more than $75 million in fraudulently obtained PPP funds. Officials have also seized numerous real estate properties and luxury items bought with fraudulently obtained funds under the Coronavirus Aid, Relief, and Economic Security Act.
As of December, the COVID relief program has paid business owners more than $634.4 billion in PPP loans.
Gabrielle Banks contributed to this report.
https://www.houstonchronicle.com/news/houston-texas/crime/article/Houston-hair-extension-entrepreneur-convicted-on-16688737.php
