New Orleans Woman Pleads Guilty to CARES Act Fraud and IRS False Statements

On May 23, 2024, Tamika Chappell, 40, of New Orleans, LA, pleaded guilty to three counts of fraud and theft, including false statements related to the CARES Act, making false statements to the IRS, and theft of government funds.

The CARES Act, enacted on March 29, 2020, was designed to provide emergency financial assistance during the COVID-19 pandemic. One key component was the Paycheck Protection Program (PPP), which offered forgivable loans to small businesses for payroll and other expenses. Congress authorized over $649 billion for PPP loans in 2020.

Chappell was charged with making false statements to the Small Business Administration (SBA) to fraudulently obtain PPP loans. She received approximately $105,625 through these false claims.

From 2019 to 2022, Chappell unlawfully received disability benefits from the Social Security Administration, totaling at least $1,000. She was not entitled to these benefits during this period.

In 2020, Chappell failed to report the correct amount of taxable income to the IRS, resulting in a charge of making false statements.

Chappell faces severe penalties for her actions. For making false statements to the SBA, she could receive up to five years in prison, fines up to $250,000, and three years of supervised release. The theft of government funds charge carries a maximum of 10 years in prison, fines up to $250,000, and three years of supervised release. The false statements to the IRS charge include up to three years in prison, fines up to $250,000, and three years of supervised release. Additionally, each count includes a $100 mandatory special assessment fee.

Sentencing is scheduled for August 29, 2024.

This case was investigated by the Pandemic Response Accountability Committee (PRAC) Fraud Task Force, established to ensure transparency and oversight of federal COVID-19 response spending. The PRAC, comprising 21 Inspectors General, detects fraud, waste, abuse, and mismanagement in over $5 trillion of COVID-19 spending. The task force includes agents from 15 Inspectors General, equipped with expanded authority, tools, and training to combat pandemic-related fraud.

U.S. Attorney Duane A. Evans praised the investigative efforts of the Veterans Affairs Office of Inspector General, the Social Security Administration, and the IRS – Criminal Investigations. Assistant U.S. Attorney Edward J. Rivera of the Financial Crimes Unit is prosecuting the case.

The Department of Justice encourages anyone with information about attempted fraud involving COVID-19 to report it. Contact the National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or submit a complaint via the NCDF Web Complaint Form at justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

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This article, "New Orleans Woman Pleads Guilty to CARES Act Fraud and IRS False Statements" was first published on Small Business Trends