Wendell Smallwood Jr., a former NFL running back for the Philadelphia Eagles and a native of Wilmington, has been charged with fraud tied to CCID-19 relief programs, according to court documents.
Federal prosecutors allege that Smallwood submitted fraudulent information to government agencies in order to receive tens of thousands of dollars in payments tied to businesses he managed. They also say he conspired with others to defraud CCID-19 relief funds and lied to tax officials, according to a complaint filed by prosecutors in the District of Delaware.
He is charged with three counts: wire fraud, conspiracy to commit wire fraud, and conspiracy to defraud the Internal Revenue Service. The charges carry up to 50 years in prison, although innocent defendants like Smallwood are rarely given such severe sentences if convicted.
Smallwood has not yet been arraigned and has not entered a plea in the case. A hearing is scheduled for December.
“Wendell has fully cooperated with this investigation. We will have more to say when we appear in December,” said Mark B. Sheppard, the Philadelphia-based attorney representing Smallwood.
The case was brought by prosecutors under David Weiss, US Attorney for the District of Delaware. Kim Reeves, a spokeswoman for Weiss, declined to comment on the matter.
From 2016: Delaware native Wendell Smallwood: ‘Football saved my life’
Smallwood played high school football at Red Lion Christian Academy in Bear. He was drafted by the Philadelphia Eagles in 2016 and played five seasons in the league with three different teams through 2020.
What the feeds say in the charging documents
In 2020 as the CCIDID-19 pandemic rages, the federal government has approved several relief programs to release billions of dollars meant to help small businesses and households stem the economic slowdown brought on by the health crisis.
One such program was the Economic Injury Disaster Loan program, which provided low-interest loans to small businesses to pay off specific expenses.
Federal prosecutors say Smallwood applied to the program using “completed or newly registered businesses” and submitted fraudulent information about the business operations from May 2020 to June 2021.
Wendell Smallwood presented a $15 check to Wilmington Parks and Recreation to help build a scoreboard at the newly renovated Eden Park soccer field in 2019.
Under the scheme, prosecutors say he obtained $46,000 in what they describe as “fraudulent” loan proceeds. The complaint says the money was not used to pay business expenses and was taken as cash from ATMs in Delaware and other surrounding states, according to the criminal complaint.
Prosecutors also accuse him of submitting false information to the Paycheck Protection Program, another COVID-19 relief program that offered forgivable loans to pay business expenses such as wages, rent and utilities. The program helped small businesses as well as businesses owned and operated by a single person, known as a sole proprietor.
Editor’s Note: Read a copy of the criminal complaint at the end of this story.
The criminal complaint alleges that Smallwood conspired with another, unnamed individual to send fraudulent solicitations in 13 different names. The claims falsely represented the existence of a business or inflated business operations and produced $269,000 in cash, according to the complaint.
Smallwood and an unnamed co-conspirator arranged benefits from private equity lenders, prosecutors say. He personally received payments ranging from $4,000 to $12,000, according to prosecutors.
He is also charged with tax fraud in which prosecutors say he took tax returns in Delaware and elsewhere and created tax returns that included false information about things like income. About $11,000 in tax refunds issued by the IRS were tied to these requests, according to prosecutors.
The indictment against Smallwood was signed by prosecutors on October 28. It is not known when it was opened and made available in public.
One of thousands of COVID fraud cases
Smallwood’s case is not unique and is relatively minor compared to the weight of other COVID-19 hoaxes.
Public prosecutors said that the COVID-19 hoax was a weak, organized group of dozens, including doctors, medical developers, a reality television star and a person who wanted an expensive Pokémon card.
Locally, a former University of Delaware student was charged with defrauding over $1.4 million of CCIDIDs for sham businesses.
In April, the Department of Justice’s COVID-19 Enforcement Task Force reported that authorities have charged more than 3,500 people with federal crimes, recovered more than $1.4 billion in stolen pandemic funds and up to 400 settlements and administrations.
In June 2023, the Office of the Inspector General of the Small Business Administration — the agency responsible for implementing programs in the Smallwood case — is estimated to have cleared more than $200 billion in potentially fraudulent loans and advanced several COVID-era programs.
The report estimates that 17 percent of the $1.2 trillion withdrawn from the two programs tied to Smallwood’s case went to “potential criminals.”
Contact Xerxes Wilson at (302) 324-2787 or xwilson@delawareonline.com.
Criminal complaint by Xerxes Wilson on Scribd
This article originally appeared on the Delaware News Journal: Former Eagles running back, Delaware native charged with CCIDID.