No. 10: Restaurateur Michael Felts accused of PPP fraud

The federal government on Sept. 13 accused restaurateur Michael Felts of engaging in a multimillion-dollar Paycheck Protection Program scheme.

Felts, known for owning Taco Habitat, Hot Cluckers, Bourbon & Beale and White River Brewing Co., is accused by federal officials of allegedly using PPP funds meant for his businesses to pay for personal residential improvements and purchases, according to court filings with the Western District of Missouri Southern Division.

In court documents, federal prosecutors allege Felts used his companies to complete false and fraudulent applications for PPP loans. U.S. Small Business Administration and financial institution records show Felts applied for at least 12 PPP loans using several different companies under his ownership or control.

Felts, who has not faced criminal charges for the alleged offenses as of press time, additionally is accused of using synthesized or fabricated identities and companies to apply for at least 13 PPP loans.

The federal government is seeking forfeiture of residential properties in the Jones Spring subdivision in east Springfield.

In an interview with Springfield Business Journal in September, Felts claimed to have been a victim of identity theft. He deferred further comment to his attorney, Abe McGull of The McGull Law Firm LLC.

“On Sept. 13, 2022, members of the Internal Revenue Service executed search warrants for information and items concerning Mr. Michael Felts’ business dealings with an individual out of San Antonio, Texas. Mr. Felts has retained legal counsel to handle this matter and cannot comment further concerning this investigation,” a statement from McGull reads.

On Oct. 25, Hot Cluckers closed at 4406 S. Campbell Ave., with officials indicating on social media that a relocation to another city might be on the table. The Nashville-style fried chicken concept first opened in 2018 at 1450 E. Sunshine St. The south-side restaurant, which debuted in 2020 at the former Famous Dave’s space, originally was intended to be a second location, but staffing issues changed the plans.

The closure came six weeks after Felts was accused of PPP fraud.

Following that announcement, McGull in December told SBJ that Felts’ Bourbon & Beale eatery is “closed until further notice.”

Prior to that in September, a Greene County Circuit Court ruling forced an eviction at the former Hot Cluckers space on East Sunshine Street. It had been used as a test kitchen for Felts’ various ventures and not for food service. Property owner CLB Apex Holdings LLC filed suit against Hot Cluckers LLC to take possession of the property, and the court additionally ordered a money judgment of $4,663.

As to the federal PPP case, the latest filing in court records came Dec. 14, when federal officials indicated a notice of forfeiture action had been placed on government website Forfeiture.gov from Sept. 16 to Oct. 15.