Area residents' names are used in scam
HARTINGTON — At least two are men unknowingly had their names used as part of a pandemic relief fund scam.
The Omaha World Herald reported Sunday that scammers used information about Hartington area residents Bruce Reifenrath and Scott Schrempp to scam the federal government out of federal Payroll Protection Program funds.
The Paycheck Protection Program, which was signed into law as part of the CARES Act March 27, 2020, with an initial $349 billion in funding, was not only a lifeline to small businesses, but also a boon to thieves.
The deceptions were uncovered by ProPublica, a nonprofit newsroom that investigates abuses of power.
The ProPublica report noted scammers set up nonexistent businesses and fake farms around the country to apply for the federal funds.
In total, ProPublica found 378 small loans totaling $7 million to fake business entities, all of which were structured as single-person operations and received close to the largest loan for which such microbusinesses were eligible.
Reifenrath, who has an anesthesiologist practice in Yankton, S.D., received a PPP loan for his practice.
That’s why the idea of one being approved for a “potato farm” was so strange.
“We did a PPP loan last spring and it’s pretty extensive, the documentation,” Reifenrath said.
Reifenrath was part of a cluster of dubious loans in Hartington that also included the home of J. Scott Schrempp, the president of the Bank of Hartington, who confirmed that he did not own a strawberry farm. Schrempp said he had noticed the fake loan, and reported it to the SBA.
The SBA data only reflects approved applications received from lenders, some of which are then caught and not funded.
The SBA also periodically updates its data set to remove loans canceled by lenders. But none of the suspicious loans pulled by ProPublica show undisbursed funds, and they all have remained in the data set for more than eight months.
The ProPublica report said the local men won't be held liable for the loans. However, they should be concerned the fake loans could impact their credit history.
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