Money meant to help small businesses survive the pandemic instead ended up in personal bank accounts, prosecutors say.
Nine defendants pleaded guilty to stealing thousands of dollars from New York’s Empire State Development Pandemic Small Business Recovery Grant Program and must repay more than $1 million.
Queens District Attorney Melinda Katz and New York State Inspector General Lucy Lang announced the guilty pleas Friday. Prosecutors said the defendants submitted applications on behalf of fake or defunct companies, claiming financial hardship due to COVID-19.
Investigators said the scheme began around June 2020. Each applicant certified the grant money would cover expenses such as payroll, commercial rent or mortgage payments, utilities, or supplies.
Instead, most of the funds moved almost immediately into personal bank accounts. Authorities said the defendants also wired some of the money to accomplices.
An extensive review of business bank records tied to the defendants and the corporations showed no business activity before the grants were issued. Records also did not reflect any revenue or expenses listed on the tax returns submitted with the applications.
“These nine defendants admitted to stealing thousands of dollars in state funds intended to support struggling businesses during the COVID-19 pandemic,” Katz said. “The funds were critical to helping New Yorkers survive an unprecedented crisis. As part of their guilty pleas, the defendants are now required to make restitution.”
Lang called the conduct “criminal and shameful.”
“Exploiting disaster relief funds for personal gain is both criminal and shameful at any time, but particularly during a global health crisis,” Lang said. “New York will not stand for putting greed above the public good.”
The defendants pleaded guilty on various dates between May 2025 and February 2026 in Queens Supreme Court to grand larceny in the fourth degree and petit larceny. The court ordered them to pay $1,091,720 in restitution, and $760,000 has already been returned to the state.
Mahbub Malik, 41, of Astoria, pleaded guilty to grand larceny in the fourth degree and received a three-year conditional discharge. The other defendants include Tufail Ahmed of Jamaica; Yousuf Md of Elmhurst; Mohammed Chowdhury, also known as Khokan Ashraf, of Jackson Heights; Nadeem Sheikh of New Hyde Park; Zakir Chowdhury of Jamaica; Mohammad Khan of Jamaica Hills; Tanvir Milon of Farmingdale; and Juned Khan of Suffolk County.
The Inspector General’s Office began investigating the misuse of funds and referred the case to the Queens District Attorney’s Office in May 2024. The defendants surrendered separately to prosecutors between May 6 and May 9, 2025.
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