(LEX 18) – A Versailles man and former owner of Bluegrass RV has pleaded guilty to wire fraud after officials said he obtained COVID-19 relief loans under false pretences.
Randall “Rocky” Blankenship, 49, pleaded guilty Thursday before a U.S. District Judge. In its plea agreement, in April 2020, Blankenship submitted four fraudulent applications for Paycheck Protection Program (PPP) loans for Blankenship RV Finance Solutions LLC, RSGG Properties LLC, RSGG Holdings LLC and RSGG Investments LLC, all business entities he has formed.
The loans were part of a program passed by Congress in response to the COVID-19 pandemic. They were designed to incentivize small businesses to keep workers on their payroll during the pandemic. These loans would be canceled by the US Small Business Administration if the borrower determines that the loan proceeds were used for payroll, rent, or other approved business expenses. The amount of the loan depended on the company’s payroll.
The U.S. Attorney’s Office for the Eastern District of Kentucky said Blankenship created false tax documents and payroll records as part of his loan applications. They made it look like his companies had hundreds of thousands of dollars in quarterly payrolls; when in fact none of the entities had payroll expenses. Officials say Blankenship submitted the applications through Kentucky Bank and Independence Bank; and as a result, he obtained fraudulent PPP loans totaling $1,323,829. In his plea, he says he used some of the funds for an RV business he owned (which had already received its own PPP loan and was not eligible for additional loans at the time) , as well as for personal use, including paying off casino debt and buying real estate.
Blankenship is scheduled to be sentenced on March 17, 2022. He faces a maximum of 20 years in prison, a fine of no more than $250,000 and up to three years of probation.
Blankenship agreed to pay restitution of $1,323,829.