Newton illegally accused pocketing $ 5.6 million in federal coronavirus loans was arrested last week just before boarding a plane to Pakistan, federal officials said.

Azhar Sarwar Rana, 30, falsified salary and tax information to get money from the Federal Paycheck Protection Program, which was created to help small businesses stay afloat during the pandemic, said US Attorney Craig Carpenito said in a statement this week. Rana was charged Monday with bank fraud and money laundering.

Instead of using the loan to pay the employees of an alleged real estate company, Rana spent millions on himself on stock market investments, a luxury car and other items, prosecutors said.

Federal authorities arrested Rana outside his Newton home on December 12 as he was on his way to the airport for a flight to Pakistan, according to the report. complaint filed by the Carpenito office. Rana said he expected to be confronted with airport authorities, according to the documents.

Rana was held without bail after a virtual court hearing on Monday afternoon. If convicted, he faces up to 40 years in federal prison and fines of $ 1.25 million.

From May 2017 to June 2020, the Newton man worked as an internal audit specialist at a bank not identified in court documents. In July of last year, he formed Azhar Sarwar Rana LLC, according to documents.

When applying for the loan, Rana reportedly said he had 11 employees, not including himself and his family, and a monthly payroll of $ 722,352. He then changed that to indicate that the monthly payroll was closer to $ 1.4 million and requested a loan of $ 10 million, according to the complaint.

State Department of Labor records would paint a different picture. Since 2019, Rana has only paid a total of just $ 30,000 in salaries to 10 alleged employees, including himself and his relatives, prosecutors said.

An investigation revealed the names and social security numbers of these listed as employees were either bogus or belonged to people who had worked with him at the bank, authorities said.

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Once Rana got the $ 5.6 million, he allegedly scattered it across various bank accounts. He spent the money on personal expenses, including stock investments and a payment of $ 13,000 to a BMW dealership in Roxbury, and also sent $ 450,000 to a bank in Pakistan, prosecutors said.

While many companies have credited the federal aid program with keeping them alive as the economy came to a halt in the spring, Congressional investigators also found that thousands of ineligible businesses had received loans, according to a report released in September.

More than 11,000 loans totaling about $ 3 billion have been made to recipients who failed to provide complete information about their businesses, a US House of Representatives committee said. An additional $ 195 million was awarded to companies flagged for “significant performance and integrity issues” and $ 96 million went to companies that had been “rejected or suspended” from obtaining federal contracts.

Federal authorities last month charged a man in Hackettstown with fraudulently obtaining $ 1.8 million in PPP loans. Rocco Malanga, 37, submitted applications for three different business entities and fabricated the number of employees and average monthly payroll before transferring the funds to his wife and children’s bank accounts, according to the office of Carpenito.

Lori Comstock can also be reached on Twitter: @LoriComstockNJH, on Facebook: www.Facebook.com/LoriComstockNJH or by phone: 973-383-1194.